Most businesses know they need a social media strategy, but struggle to understand the return on investment (ROI) it will provide.
Let’s take a look at this infographic from FOCUS examining the real costs and benefits of social media campaigns.
Cost of Social Media Campaigns
The infographic below, based on input from social media company Bonsai Interactive, presents the estimated cost for an average targeted social media campaign.
The average cost for a targeted social media campaign from Bonsai Interactive comes out to be just over $210 thousand. This cost includes a social media strategist, community manager, micro-site and mobile app.
For many companies (especially those new to social media), spending that amount of money can be hard to swallow.
In order to better understand the benefits of a targeted social media campaign, let’s look at the perceived value of social media campaigns from a survey of U.S. marketing executives on the financial impact that Facebook fans can have on a brand.
In a survey conducted by eMarketer, U.S. marketing executives responded positively to only five of the benefits of social media campaigns mentioned.
More than 50% responded positively to the following benefits of social media campaigns:
- Customer Engagement
- Customer Communication
- Speed of Feedback
- Learning Customer Preferences
- Low Cost
Note the perception of marketing executives in the United States. According to this survey, it appears that they see social media campaigns as a way to interact, communicate and get feedback from customers. However, they don’t see it as a great way to directly fuel growth and increase revenue, with only 21.2% respondents saying that social media campaigns are a great way to generate leads.
Value of Facebook Fans/Likes
In order to further understand if the cost of your average social media campaign is worthwhile, let’s examine a few of the leading brands on Facebook.
We can gain insights into the ROI of social media campaigns by looking into the behavior of customers who are Facebook fans of a particular brand or have liked a brand’s page in comparison to those who are not Facebook fans or have not liked a brand’s page.
According to the data from a survey conducted by Syncapse of 20 leading brands, Facebook fans and people who have liked a brand on Facebook spend more money per year on that product than those who have not become a fan or have not liked a brand’s Facebook page. The increase in spending among Facebook fans varies depending on the product.
Two of the largest increases in spending presented are from consumer electronics companies, specifically smartphone manufacturers, as well as food and beverage companies.
Here is a quick comparison of the spending by fans vs non-fans:
- Motorola – fans $160.01 vs non-fans $69.09
- Nokia – fans $171.22 vs non-fans $63.86
- Mcdonalds – fans $310.18 vs non-fans $150.39
- Starbucks – fans $235.22 vs non-fans $110.95
- Nutella – fans $113.95 vs non-fans $50.14
Social Media’s Impact on Brand Loyalty and Recommendations
As most people who follow social media marketing know, word of mouth from friends on social media sites such as Facebook is one of the most influential and effective ways to attract new customers.
According to this infographic, fans are 28% more likely to continue using a brand than non-fans. They are also 41% more likely than non-fans to recommend a product to friends.
Where’s the ROI?
When looking at the ROI of social media campaigns, it is important to consider both the immediate and long term benefits. If you believe social media is here to stay, building a strong presence on sites such as Facebook can have a big impact on brand loyalty, new customers, and overall income per customer.
Infographic courtesy of FOCUS.