Every marketer has probably asked himself/herself a similar question.
In fact, looking at a Facebook page, what are the actual merits of judgement how successful it is? Do the “likes” necessarily convert into dollars (or any other currency)?
Imagine a product or brand page that currently has 2000 fans/likes. It seems like a lot of fans and probably means a highly popular product. However, it is better to take a closer look at this number.
The first problem is if these fans actually exists. A recent case study about Facebook advertising points out that almost half of the likes came from unidentified profiles that probably have no real consumers behind them.
I.e. it may be easy to receive a number of fans by investing into Facebook advertising, however the sad fact is the existence of numerous cases of spam and fraud on the internet (possibly even whole “click farms”), which decreases the value of advertising campaigns.
Secondly, even if the fans seem to be real people, they might not be on Facebook often (or their profiles may be outdated), so that your chances of interacting with them are very low. Another extreme is the people who are keen on “liking” everything they see, so that the number of their liked Facebook pages can be counted in hundreds. In this case, your chances to reach these consumers organically will also be close to zero, since their news feeds are very cluttered.
In addition to that, if a user “liked” the page in order to take part in a Facebook lottery or any other incentive, he/she may, in fact, have little interest in the product or brand and refuse to interact with the postings.
So the only important parameter that helps to evaluate a Facebook page is the engagement, i.e. Likes, Comments or Shares of the posts. Shares are certainly the most helpful type of engagement as the organic reach of the posts increases significantly after the post is shared on the wall of a fan or in a community.
Besides, engagement influences the Edge Rank, which, in turn, determines how often (if at all) your posts will be shown to your fans, so this is a closed circle.
However, we also need to consider the pure business aspect of social media. Does “liking” a product or commenting positively on something actually involve a purchase?
Here we face the core psychological function of social media, that is image-building and self-defining both externally and internally. When a consumer clicks “like” on a product page, he or she wants to be associated with this product and add it to his or her image.
Whether this association also includes purchasing a product will depend on the total buying costs (that is the price and availability of the product, conditions for use, etc.) As an example: it is highly unlikely that out of 15,5 million Ferrari fans on Facebook (as of July 2014) everyone or at least a half own a Ferrari.
Social Media may play a significant role in after-sale marketing or brand-building, but the actual purchase motivation has to be supported by promotion (discounts, special offers, testers, etc.).
In summary, the turnover of 2000 likes may be much lower than expected, so when budgeting for Social Media one has to consider the return on investment aspect in the first place.