Fans are Valuable. Advocates are Priceless.

Recent studies have proposed to place a dollar value on your brand’s social media connections. You know – fans. The study is onto some something. Yet it may have missed the big payoff - fans are nice but advocates are where the money is. Advocates are the ones who'll stand up for you in tough times and promote you within their sphere of influence at all times. So it makes sense to mine the list of people who "like” you for those who are your advocates. And since Facebook contends that the average user has 150 friends, they potentially have considerable potential to advocate your brand.

The study: Syncapse surveyed 4,000 fans of 20 of the top brands (i.e. Nike, Starbucks, Coca-Cola) on Facebook. Then they estimated the value of each fan’s spending as well as the value of continuing to have that fan as a customer over time. The result? Each fan is worth $140. That’s a lot coffee if you’re Starbucks. It may even be a conservative estimate for highly successful social brands. Of course it seems logical that fans would buy and would continue to buy stuff. However, I propose that their value is less about their “spend” and more about their “recommend”.

The same survey found that four-out-of-ten fans would recommend a product that they fan to their friends. I'll call the "recommenders" advocates. Now, if we use Syncapse’s $140 fan-value that makes the advocate worth potentially much more. I’m not a mathematician but here’s my formula:

• Average number of friends per Facebook user: 150
• Average number of friends fans recommend to: 60
• Multiply friend recommendation by Syncapse’s valuation: $8,400

That’s before considering the value of new customers who become fans, who may subsequently become advocates that recommend your brand. Wow! Priceless (sorry, MasterCard).

Your next assignment: find and/or create advocates. It will be easy to find some. They’re the ones retweeting your posts or liking your comments. The others? Well, that requires a strategy and it’s worth more than I can charge here (smile).

Let’s talk www.twitter.com/timbigfish or www.facebook.com/timcnicholson