Wednesday, 28 April 2010

More than 10m people each day become a “fan” of a brand on Facebook.

When first faced with the prospect of marketing on social networks, many people ask a reasonable question: how many people want to be friends with a brand? The answer – surprisingly, perhaps – is: millions do, on a daily basis.
More than 10m people each day become a “fan” of a brand on Facebook. The world’s largest social network – with well in excess of 400m members globally – plays host to more than 1.4m branded fan pages on Facebook. BrandZ Top 100 brands such as Coca-Cola and Starbucks, along with other smaller brands outside the Top 100 such as Adidas (brand value or BV of $3.3bn in the latest MBO list), have each “befriended” millions of people.
“A lot of our best brand builders are also some of the best companies using social media,” says Joanna Seddon, chief executive of Millward Brown Optimor, which compiles the BrandZ ranking. “A lot of the leadership in social media is really centred in the top 100 brands.”
Social media has matured rapidly in recent years. Sites such as YouTube, Facebook and Twitter offer scale and reach to rival Google – still the most dominant single site for online advertising – and many television channels. The best advertisers use social media alongside these traditional channels for a combination of brand-building, direct sales, customer service and PR. The worst simply ignore them, blissful only until they realise the complaints and accusations that disgruntled customers are telling other would-be consumers.
“Social media have given consumers a voice to respond, as well as hundreds of channels through which to do so,” says Debbie Klein, joint chief executive of Engine, a UK-based agency group. “These websites have fundamentally transformed marketing from a monologue to a dialogue. Brands cannot hide.”
Eurostar, for instance, faced criticism last December for ignoring Twitter messages – which, unlike most Facebook posts, are usually made public for anyone to read – from angry customers trapped on trains between Paris and London. Eurostar had failed to grab its brand name on Twitter, and its main presence on the site – named “little_break” to tie into a wider marketing campaign – was still showing special offers rather than information on the disrupted service for some hours after the problems began.
In the fast-paced, “real-time” environment of Twitter, just a few hours is long enough for such criticism to spread widely, be chewed over by its denizens and, if it reaches a certain volume, be picked up and amplified further by the mainstream media. Kevin Smith, a film director, caused a similar Twitter storm when he complained to more than 1m followers that Southwest Airlines threw him off a flight for being overweight. Southwest later made two public apologies on its blog.
But for every Eurostar or Southwest, there is a success story that proves social media need not be just for moaning and crisis management. Dell, another Top 100 brand, claims to have generated several million dollars in sales from Twitter alone, where it regularly posts special offers on its computers.
Facebook likes to point to the example of Adidas, the sportswear maker which has more than 2.7m fans on its Adidas Originals page. Each fan is estimated to be worth around $100 a year in footwear, making its fan page a community worth more than $200m with which it can communicate directly all year around, for only the cost of maintaining the page. Becoming a fan of a brand on Facebook means agreeing to allow a company to send messages into that user’s main “news feed” – the part of the site in which Facebookers spend around two thirds of their time.
The new forms of social media are also generating new creative possibilities for brands. Ahead of the launch of its new Fiesta, Ford (BV up 19 per cent this year to $7bn, just short of the cut for making the Top 100) gave 100 “internet celebrities” the latest model and gave them freedom to document their experience online. Millions of YouTube viewings later, they had sold 10,000 cars in six days and had ready-made content for the TV ad officially launching the car.
Last year, Burger King’s “Whopper Sacrifice” offered a free hamburger to anybody who deleted 10 of their Facebook friends. Each sacrificial victim was sent a message explaining what had happened, and so the message spread (at least, until Facebook made Burger King tone down its application after more than 200,000 such sacrifices were made).
But although social media can be used to achieve high impact with much lower investment than traditional media, seasoned observers note that many ostensibly “viral” campaigns have had more than a little nudge along the way.
“The beauty of social media is that they are accessible across a large range of budgets,” says Jason Klein, co-president of LBi in New York, a digital agency. “[As for Facebook] pages with hundreds of thousands of people, some [companies or products] have brand equity to attract that but a lot, I would assume, have been driven up with some form of media buy … Facebook has been shrewd about building a platform that makes it very difficult to grow groups organically.”
Facebook’s “engagement ads” are one way for companies to buy traffic for their fan pages. Twitter has recently introduced advertising in its search results, in the form of “promoted tweets”, which have seen Starbucks’ messages appear when people search for “coffee”.
But Mr Klein warns against using follower counts or group size as a measure of success in social media. “People don’t know what they want to get back so they have to hang their hat on the number of posts, friends or comments. We have tried hard to educate our clients that even though these aren’t the exact metrics to know something is successful, to focus just on the numbers takes your eye off the ball a bit. Would I rather have thousands of people believe in my brand than hundreds of thousands signing up because they got a free key chain?”
Navigating the constantly evolving world of social media will claim more casualties yet.
Simon Clift, until recently the chief marketing officer at Unilever, has warned of a “lost generation” of marketers who do not understand the social web, either because they are too old, or too young to learn from their children.
“There is no question that social media of all the challenges in media is the hardest one,” Mr Clift says. “You have to listen rather than impose, which is difficult for all marketers.”
Meanwhile, in another sign of the times, Facebook has made its own debut in the BrandZ rankings. With a BV of $5.5bn, it is not yet in the Top 100, but slips in as 20th in the Technology Top 20.