Companies Ask: What Does Facebook Mean to Business?

Ever since I began doing reach on social media, I have often heard from people asking me: “Yes, you can build a large group of fans on Facebook, so what?” “What does it mean to business?” “After spending all these money and time on building a large fan base, I want to see some green on the book. Where is it?” Unfortunately, (to my knowledge) there is no such an easy formula like “X number of Facebook fans = Y amount of revenue.”

This Mondy’s Wall Street Journal (WSJ) reported that companies are eager to dig into the “rich” demographic information of their Facebook fans and get some value out of it (report + video). Walt Disney, for example, hires an independent customer relationship marketing agency to track the profiles of their fans, their previous visits to Disney, and their plans for future visits. According to this WSJ report, Facebook does not share individual users’ information with advertisers. One way to attain Facebook users’ information is to have them sign up for an app and grant the permission of accessing their information by the app developer.

The “rich” demographic information of Facebook users is certainly very important to every marketer and business. Based on the Facebook data I have on hand, however, I believe that the value of Facebook means more than just Facebook users’ demographic information. Smart companies understand how to engage with their Facebook fans. If it is used appropriately, Facebook can be used as a free market research tool. The feedback a company can get from its loyal Facebook fans is priceless. On top of that, there are companies (e.g., Delta Airline and Design Hotels) allowing Facebook users to make reservations directly on their companies’ Facebook page. These companies should know exactly “how much” Facebook means to their bottom line.

In conclusion, It may not seem easy to measure the ROI (return on investment) of a company’s effort on Facebook, but it is not impossible. In addition to the examples I suggested, what are the alternatives that a company can use to measure the importance of Facebook?



References:
Steel, Emily (2011, October 3). Facebook’s brand of loyalty: Companies hope to learn more about fans by offering applications on site. The Wall Street Journal, B9. Also available online.
Picture was downloaded from Hotwebsinfo.Blogspot.com.

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