Leading brands across verticals including FMCG and Retail are spending a great deal to get their brands visible on Facebook. But are they on the right path? To analyze the correlation between fans and the time that they spend on their favourite brand on Facebook, Kuliza decided to run a check on the Indian brands social media effectiveness. The results were an eye-opener.

We deduced that brands have made significant investments on Facebook page engagement but are clearly deriving very less value out of it. Brands currently measure their social media effectiveness based on their total number of fans or cost per fan. However most of these fans are dormant and are doing no activity on the page.

To begin with, we defined ‘Alive Fan’. These are fans who have had any activity (likes, shares or comments) on the brand’s Facebook page during a period of six months. Once this data was collected, an analysis was done for the percentage of alive fans as opposed to the total number of fans on the page. But this was not all. Powered by Kuliza Proprietary tools, the information was dissected further by analyzing the average cost of a ‘like’ for every industry vertical to deduce the average cost of an ‘alive fan’.

Kuliza developed a matrix to plot the total number of Facebook fans on a brand’s page verses the percentage of alive fans. This effectively evaluates the co-relation and dynamics of total fans for a brand on the page as opposed to the actively engaged audience on Facebook. The research was done on 508 leading brands with India specific Facebook pages. The research was done across 7 industry verticals: FMCG, CD, BFSI, Hospitality, Automobile, Fashion Retail and food retail.

Key metrics and calculations

  • The average cost per fan has been taken as INR 3 for fashion and apparel and normalized for all other verticals based on Salesforce’s Facebook Ad Benchmark Report 2013.
  • Cost per alive fan (CPA) has been calculated as per the formula:
    CPA = (Average cost per fan / percentage alive Facebook fans) *100
    For example: If a brand is spending INR 4 as the average cost per Facebook fan and only 2% of their fans are alive, the cost per alive fan is (4/2)*100 = INR 200
  • The complete tool can be accessed here: http://www.kulizastudio.com/ranks/

To get a detailed eye-opener of our analysis, make sure you don’t miss out on the infographic below.

Facebook Infographic 21v (1)

This article was originally written by Kaushal Sarda for Exchange 4 Media and was published on 3rd December 2014.