A Facebook Fan is worth $3.60. Really?
The dollar amount was concluded by determining that on average, a fan base of 1 million translates into at least $3.6 million in equivalent media over a year. The $3.6 million figure came by working off a $5 CPM (meaning, that a brand’s 1 million fans generate about $300,000 in media value each month).
Because ROI is so important for being able to justify a company diving into social media, too many organizations and studies are trying to quantify how much money an individual “Fan” or “Follower” is.
My math skills may see how the study got us here, but my deductive reasoning skills lead me to different conclusions.
I understand the need to create a monetary value for Fans. If your business is to work with large companies with social media you’ll need to show them that the money is justified. A finite dollar value makes for a much easier sales pitch for allocating marketing dollars from Television and traditional media platforms into the social media bucket.
I get Vitrue’s study and reason to put it out there. It’s easier to sell to more folks in PR, Marketing, and Advertising that are still speaking the language of “impressions”. But what I don’t get is everyone else who buys it. Come on, really? You think that every fan is really worth $3.60 in media value?
I am hoping the day comes soon that we can move the discussion involving social media away from impressions.
Am I just off on a rant today or do you agree? Is this a fair assessment for value of Facebook Fans?
What are your thoughts and if I’m wrong…where?
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Scott S. Bishop is editor for Real Time Marketer and a marketing strategist with a specialty in social media. He is an avid blogger and active across the net. He is @thescottbishop on Twitter