Study Finds Facebook Fan Pages Effective Marketing Tools
Companies that use Facebook fan pages to market themselves to consumers can significantly increase sales, word-of-mouth marketing and customer loyalty among a subset of their customers, according to new research from Rice University's Jones Graduate School of Business. The study is featured in the March issue of the Harvard Business Review.
Research for the article, "How Effective Is Facebook Marketing?" was conducted by Utpal Dholakia, associate professor of management at Rice University's Jones Graduate School of Business, and Emily Durham, a Jones School alumna and founder of Restaurant Connections, a Houston‐based restaurant consultancy.
Dholakia and Durham surveyed customers of Dessert Gallery, a popular Houston-based café chain. Prior to the study, Dessert Gallery didn't have a Facebook presence.
The study, based on the responses of more than 1,700 consumers over a three-month period, found that compared with typical Dessert Gallery customers, the company's Facebook fans:
∗ made 36 percent more visits to Dessert Gallery stores each month;
∗ spent 45 percent more of their eating-out dollars at Dessert Gallery;
∗ spent 33 percent more at Dessert Gallery stores;
∗ had 14 percent higher emotional attachment to the Dessert Gallery brand; and
∗ had 41 percent greater psychological loyalty toward Dessert Gallery.
While the results indicate that Facebook fan pages offer an effective and low-cost way of social media marketing, Dholakia said in a statement that marketers should be cautious when interpreting the study's results.
"The fact that only about 5 percent of the firm's 13,000 customers became Facebook fans within three months indicates that Facebook fan pages may work best as niche marketing programs targeted to customers who regularly use Facebook," said Dholakia. "Social media marketing must be employed judiciously with other types of marketing programs."
Facebook marketing programs may be especially effective for iconic brands, Dholakia added, "which appear to attract a higher percentage of their customer base as Facebook fans."