The Like Effect: The Power of Positive Marketing

Nov 14, 2013

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This chapter explains where and how Facebook fits in with marketers - and how those marketers can benefit from understanding how to use it to interact with customers.

This chapter is from the book 

Like Economy, The: How Businesses Make Money with Facebook, 2nd Edition

Learn More Buy

Facebook is a marketing tool unlike any the world has seen. Facebook marketing is different because positivity is part of its DNA. The act of liking has far-reaching impact and a quantifiable effect on commerce.

Facebook likes

Decrease marketing costs.
Increase sales.
Give you control of the customer conversation.
Prove people are paying attention.
Solidify customer loyalty.
Create evangelistic customers who sell for you and defend you against critics.

Let’s look at each of those in detail.

Likes Decrease Costs and Increase Profits

When more people like your Facebook ads, your click cost decreases and so does the cost to acquire each fan. When more of your page fans like your page posts:

You get more visibility and loyalty from each Facebook fan.
Cost per impression decreases.
Cost per customer decreases.
The lifetime value of your customer increases.

ChompOn, a company that provides a white-label platform for Groupon-like deal websites, gathered data from numerous e-commerce stores to try to figure out how much revenue a company can expect on average from each person who likes a page. They found the value of each like to be $8.00 (see Figure 1.1).¹ Other studies have found the value of a like to be $3.60,² $136.38³ and $214.81.⁴ The actual value to your company depends on how effectively you monetize them, and how accurately you can measure the revenue and other value they bring you.

Figure 1.1. ChompOn’s study of the e-commerce value of social actions.

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