Facebook fan marketing proves sweet - study

12 Mar 2010

Rice University's Jones Graduate School of Business has researched and documented the power of Facebook fans by what is styled as the first-of-its-kind. According to Dave Duarte, director of the Nomadic Marketing course run by the UCT Graduate School of Business (GSB), this survey is the first to offer evidence that Facebook fan pages are an effective and low-cost way to market.

The study surveyed customers of Dessert Gallery (DG), a popular US-based café chain. Prior to the study, DG did not have a Facebook presence. It covered 1700 respondents over a three-month period and found that compared with typical DG customers, the company's Facebook fans:

Made 36% more visits to its stores each month;
Spent 45% more of their eating-out dollars at the stores;
Spent 33% more at the stores;
Had 14% higher emotional attachment to the brand; and
Had 41% greater psychological loyalty toward the brand.

This research published in Harvard Business Review this month, states that Facebook fan pages are an effective marketing tool. Companies that use the fan page module to market themselves to customers can increase sales, word-of-mouth marketing and customer loyalty.

Duarte adds that the finding comes at an opportune time as more and more South African companies are wising up to the power of Facebook and other social media as a marketing tool.

South Africans now moving to digital

“Despite some early movers, the vast majority of SA businesses have to date been under-prepared to capitalise on these new marketing possibilities. There is now, however, a growing eagerness to find out more and integrate online and mobile into their existing marketing activities,” said Duarte.

To use the terminology of Forrester - a leading global market research company - many South African companies are fast moving away from being Sceptics and Experimenters, and moving into the Practitioner and Conductor stage. The Forrester's model has four levels of online marketing maturity - sceptics being least mature and conductors the most.

“We are now starting to become more capable to take advantage of this new wave in marketing. On the GSB Nomadic Marketing course, which offers the latest expertise in online and mobile marketing, we have seen an increase in the numbers of businesses ready to step up to become effective practitioners.”