Social Media ROI – Value of a Fan

Today (April 13, 2010), Adweek came out with article describing how Vitrue determined the value of a Facebook fan.  That got me thinking.

First of all, the measurement “$$/fan” is misleading.  The measurement should state “$$/fan/year” or month or some time period.  Otherwise, it simply doesn’t make sense.

Now, how do we determine the value of a fan?  The following is a short list of fan-added values.  For a longer description, see Social Media ROI – Part 3:

  1. Brand Awareness – a fan reads your messages.  That is value.
  2. Click-throughs – a fan clicks on a link. That is value.
  3. Fans create buzz such that trade media writes about it.  That is value.
  4. Fans generate consumer insight.  That is value.
  5. Fans help each other thus preventing support call costs.  That is value.
  6. Fans without actions.  A fan that doesn’t do anything is a dud.  Having 10,000 fans that don’t contribute give you bragging rights but no value.

By adding these and other value (return) channels together, we get the total value per fan per year.  But, again, that is only part of the story.  Look at our post from yesterday, Social Media ROI – three types of Social Media Return, and suddenly “fan value” got more complex.  Nevertheless, simple is good so lets stay with that.

Also, take a peek at our Social Media ROI video for more info how to calculate fan value.

Comments are a fundamental part of social media, so do your social duty and add a comment with your thoughts.

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4 Responses to Social Media ROI – Value of a Fan

  1. [...] Jungs von Klurig Analytics haben sich zwar mehr auf Social Media ROI spezialisiert aber auch ein Nicht-Social-Media-Guru kann [...]

  2. adam wexler says:

    ” A fan that doesn’t do anything is a dud. Having 10,000 fans that don’t contribute give you bragging rights but no value.”
    agree with everything stated above, but i’d just add that increased numbers tend to imply greater credibility so that’s worth mentioning. other than that though, it’s absolutely more important to seek out the engaged fanbase.

    • dagholmboe says:

      Yes, you are 100% correct. In general, it is a numbers game, eg the more fans you have, the more credibility (as you suggest) and normally also a higher conversation rate.

      Thanks for the comment. Let me know if you have any other comments or if you have suggestions or questions. All is good.

    • dagholmboe says:

      Adam, I like your gorankem.com site. Very cool idea and execution.

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