These days it seems like everyone on Facebook is obsessed with getting more likes. Heck, it’s even a better obsession today than in the past, because there’s a more widespread understanding that it’s the quality of the like that’s important, not just the quantity of likes. It begs the question, though; just how valuable is a like?
I can’t give you that answer. The trouble is, it varies from business to business and even from like to like. There are a lot of factors going into this value calculation, and there are different ways to consider value. Let’s take a look at them, shall we?
Factors Affected the Value of a Like
The first important factor is, as mentioned above, the quality of the like. You could have a million likes from robots run by a few dudes in India, and they might as well not exist. Their effective value is zero. On the other hand, quality likes – people with the interest and potential intent to buy your product – are worth a hell of a lot more.
The cost of your product or service is another factor. When a user converts, how much profit does it bring in? If you’re a business selling $10 balloon animals, first of all, congratulations on monetizing the concept online, that’s pretty cool of you.
Secondly, the value of an individual high quality like is probably only $10, maybe $30 or $40 if they’re going to buy more than one balloon animal. On the other hand, if you’re a business selling $150,000 mecha-cars, you’re going to have much more valuable fans. One quality like would be worth $150,000, assuming they convert. That makes one quality like on your mecha-car business worth 15,000 quality likes on the balloon animal business.
A third factor, if you look at it the right way, might be the size of the friends list of the person liking your page. This comes from an engagement and EdgeRank standpoint. When a user shares a post you’ve made, people on their friends list see it. If a user has 10 friends, that’s 10 more people who might see your post. On the other hand, a user with 1,000 friends might show your post to a few hundred people when they share it. In that sense, a follower with more friends is more valuable than a follower without.
This is sort of an indirect measure of value, though. None of the people seeing your post are worth anything to you unless they then like your page, click through to your website, and convert. At that point, they’re first-degree connections rather than second-degree connections, so the point becomes moot.
Value of Purchasing Fans
Here’s one way to look at the value of a fan; how much does it cost to acquire one? This is where some of those value factors come into play. For example, fan quality. Of course it’s cheap to spend $5 on 10,000 followers, but those followers come from click farms and are worth essentially $0 for your business. In fact, since you spend money to acquire them, they’re worth a negative amount of money.
The closest thing there is to an expert on the subject would have to be Jon Loomer, who has spent years and thousands of dollars on managing Facebook advertising for a variety of brands, and has extensive experience. His opinion is that you should expect to pay anywhere between $0.20 and $1.00 on a single relevant fan.
Fortunately for small businesses, your cost to acquire a valuable fan is more likely to be in the $0.20 range to start. This is because Facebook is very wide and has a lot of people who fit the description. As you build your audience, you exhaust your list of ideal prospects and have to start reaching for the second best, and so forth. These fans grow more expensive to acquire, because you need to expose yourself to more of them to find the valuable fans.
This cost is slightly deceptive. This is the cost specifically to acquire the fan. You then have the additional cost of having to advertise to them until they convert, which can rack up. Depending on the advertising methods you use and the success rate, the cost of a conversion can vary dramatically.
In this sense, the value of a fan – in terms of cost to acquire – is low, under $1 each typically. But that’s just one way of looking at it.
Value of Fans Based on Conversion Rates
Here’s another way of looking at value; how much do you get out of a fan when they convert? Take our mecha-car example above. One fan converting earns you $150,000. That’s a heck of a lot of money, but it’s also a very hard sell. Not very many of your fans, even the highest quality fans, are really in the market for mecha-cars.
While the value of a conversion in this case is $150,000, that’s not the value of the fan. To find the value of the fan, you need to consider your conversion rate.
Imagine you have, say, 100,000 fans. Out of this stack of fans, only 100 of them convert in a given month. That’s a conversion rate of one in a thousand, or .1%. You had to acquire 1,000 fans in order to get one conversion, so you might be able to consider the value of the conversion as split amongst those 1,000 fans. In this case, the $150,000 mecha-car, split amongst 1,000 people, is only $150 per fan. The value of an individual fan, then, is $150.
Of course, this calculation varies dramatically as your conversion rate changes, and it’s a different calculation for different scenarios. For the balloon animal business, for example, one fan might convert many times throughout a year or their lifetime. One user probably isn’t going to buy more than one mecha-car, but they might buy a dozen or a hundred balloon animals. Value stacks up with repeat conversions.
The value of a fan is all in how you look at it. Try making a few calculations for your business and see what you come up with.