Back To The Future: True Facebook ROI In The Classic Subscription Model

Posted in Facebook Advertising, Social Media Marketing

There’s been a lot of discussion over the years regarding the viability of Facebook as a marketing channel. Everything has been challenged, from FB Ads to the value of Likes. That’s good. Most of the conversation is bunk, the same way soothsayers have been saying that SEO is dead, for years and years. #Snooze. There are no crappy channels, only crappy marketers. It’s also notable that PR firms play point/counter point trying to disparage and prop up FB.

Facebook is a subscription marketing list. Everybody quite freaking out! We say Facebook marketing is the same sh_t different day. FB is yet another in a generational cavalcade of subscription marketing models. Newsgroups were the first subscription model, back in the nineties. Email emerged as a primary subscription mechanism at the same time. Listservs, newsletters, AOL Messenger, MySpace, Digg, Del.ico.uc, StumbleUpon, Reddit, Facebook, Twitter are all somehow subscription models. Sure, each channel has quirks all have their quirks and features.

Still: User A somehow follows User B. User B can therefore broadcast to User A. User B, upon receipt of the blast either takes an action…or not. Studying Facebook marketing in the subscription model and finding the metrics in FB to truly measure ROI, yields what we consider to be one of the secrets of making money in Facebook.

This post also introduces a new social marketing metric, “Community Focus” score which does an excellent job of grading the quality of your community’s subscription list. In this case the “List” at hand is a bucket of Facebook Likes you’ve either earned and purchased effectively (or not). Finally we have a method to judge whether your FB friends are valuable. We believe community density to be one of the secrets of measuring Facebook likes. Scoring “Community Density” gives marketers insightful ammunition even the most stuffy brands seem to understand. Here’s a small amount of background by way of Power Facts:

Power Fact #1: FB Insights Analytics have recently been made realtime. The data is incredibly useful to community mangers FB PPC hybrid marketers. Having access to this type of data quickly is important to the tactical execution of subscription marketing.

Power Fact #2: Nearly blind (users can’t easily tell it’s an ad) Facebook sponsored stories in the newsfeed means marketers are finally able to understand the newsfeed click through ratio (CTR). This insight is key and, as you’ll see in a moment, a foundational metric for classic subscription marketing ROI.  The Newsfeed CTR is high, sometimes over 5%. That applies both to organic and paid.  The CTRs below are for sponsored stories in the newsfeed.

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  • Jennifer Tisdel

    Great article! This clarified some leftover questions I had from your SMX Advanced workshop. I scheduled a meeting with the team this week to start implementing. Thanks!

  • Dennis Yu

    Marty,

    Wow, deep on friend and FOf connection visibility in the newsfeed.
    Any insight on what share is via the newsfeed vs ticker?
    We haven’t been able to separate this data.

    Dennis

    • Marty Weintraub

      @Dennis Yu: I’m not positive we can get that CTR unless our good friends at FB share it :). Thanks for your thoughtful comment and stopping by.

  • Kiko Correa

    Marty,

    Thank you for sharing so much valuable information with the community around you.

    Thanks to your instruction I was able to put the Community Focus Analysis portion right to work and after finding the majority of our targeting segment as FOF am now putting together a campaign to maximize our reach.

    Thanks!

    • Marty Weintraub

      @Kiko Correa: I’m glad you were able put the Community Focus Analysis study right to work. It’s powerful indeed. Good job!. Hey, what city do you live in? Will we see you at an upcoming conference?

  • Kiko Correa

    @Marty: I’m living in San Luis Obispo currently. I really want to try to go to SMX Social in December. Just a matter of convincing the bosses at this point. :)

    • Marty Weintraub

      @Kiko: San Luis Obispo, hmmmm? We love the wine country above Santa Barbara. Let’s connect next time over a nice glad of Sideways Syrah.

  • Barry Tubwell

    Another awesome post Marty. Is it just me or does anyone else feel like aimclear should be charging a monthly fee to access this blog (say $100 a month would be fair :).

    • Marty Weintraub

      @Barry Tubwell: Thank you very much. We get a lot of ROI from posts like this, none the least of which is the opportunity to organize our own thinking. Often times these posts stem from conference presentation .ppts or vice versa. In a content house like aimClear, it’s crucial to leverage the various investments in various channels, to various purposes. It’s a pleasure to share. We’re glad the posts resonate with you.

  • Dennis Miedema

    To summarize the entire post: Facebook is the same game under a different name to which the same metrics of success apply that have always been applied to online marketing. Great idea! Some other thoughts straight out of email marketing I’m not sure you mentioned:

    – Delivery time (on which day and at what time do the most people open (see), click (like or comment), and buy?
    – Split testing: when will Facebook make it happen? It made email marketing better

    • Marty Weintraub

      @Dennis Miedema: Right on! Yes, same sh_t, different day. So far as organic day parting goes, EdgeRankChecker gives some stats regarding time sensitive considerations. Also look to classic web analytics, assuming that you tag organic posts appropriately. Thanks for stopping by and the thoughtful comment.

  • Kiko Correa

    @Marty: I would LOVE that. :)