8/1/2013
The average value of a Facebook fan is $174.17 in 2013, up from $136.38 in 2010, according to market research firm Syncapse. The factors that calculate a fan’s worth include how much he or she spends on the brand, loyalty, propensity to recommend, brand affinity, efficiency to entice others to participate in brand activities, and media value.
Yet, fandom is not equal. Brands with smaller retail prices or products that have a frequent repeat purchase cycle (such as Coca-Cola, $70.16; Dr Pepper, $73.58; Oreo, $75.97; and Skittles, $104) have smaller fan values than categories with higher retail prices or category purchase prices (Walmart, $834.76, and BMW, $1,613.11). However, low valuations don’t necessarily mean these brands are failing with social media. Many times nonfans appreciate brands just as much as fans, thus lowering overall fan value since they are just as likely to recommend and purchase products. Polarization also plays a factor. Fans become avid brand advocates, whereas nonfans become disenchanted consumers.
Facebook fans are valuable to brands. On average, 80% of fans currently use the brand, and most don’t fan a brand without trying it first (BMW serving as the one exception). Fans show their support for two main reasons: to receive a coupon and to receive regular updates.
Fans are 80% more likely than nonfans to be brand users and spend 43% more on products. Fans, in general, spend $116 more than nonfans. Coca-Cola fans don’t spend as much. There’s only a $29 difference between Coca-Cola purchases by fans and those by nonfans.
Fans show support in nonmonetary manners. Disney (93%) has the highest percentage of fans that recommend Disney products, while fans of Walmart, BlackBerry, and Monster are less likely to recommend their respective products.
SOURCE: Syncapse, Max Kalehoff, VP Product Marketing, 7 W. 22nd St., 7th Fl., New York, NY 10010; 212-798-1414; m.kalehoff@syncapse.com; www.syncapse.com.
© 2013 Business Valuation Resources, LLC (BVR). May not be reproduced without written consent of publisher.