Businesses are pouring resources into social media content – but is it worth it?
Social media is a peculiar beast. Marketers have somehow been divided into those “who get it” and those who are sceptical. Among the wine people “who got it” a long time ago was Gary Vaynerchuk, who has been an advocate for the use of social media to communicate wine to consumers for many years now, and has grown beyond the wine category to become an adviser to large businesses on their digital strategies. Sceptics used to be cautious about airing their views, but the recent scandals over social media advertising exposure measurement have emboldened experts and leading practitioners to break cover and openly question the effectiveness of social media advertising.
I’m not going to touch on the social media advertising question here (you can find plenty of passionate debate on the subject elsewhere). Instead I’m going to consider the more simple question: how effective is social media content (Facebook postings, likes, etc, ie not advertising per se) at building brand equity?
Let’s start with the theory of wine’s alignment with the smartphone generation. At first one can see the appeal. Wine is complicated, fragmented, and often you find yourself needing good info at a moment when you are not at a computer. Quick and easy access to good advice about wine could certainly make everyone’s life much easier and interesting. It is now available via numerous bits of info you can access via a convenient computer in your pocket – the smartphone. So far so good.
No doubt this accessibility of info about wine has some effect on consumer behaviour. In an industry where TV, radio or print advertising is the exception, it is always welcoming to see nice pictures of vineyards or to indulge in a dramatic landscape. Wine brands are generally an indulgent pleasure to follow as a consumer, unlike, say, insurance companies, or cleaning products manufacturers.
The fundamental question for me is often the one I don’t see asked very often: how much of an effect does social media have on the health of a brand? Having analysed a number of leading brands, it seems that the missing link is an honest discussion about reach and impact. In other words, how influential can a social media post, or “follow”, actually be?
Some readily available metrics can give us one answer. We can quickly check how many consumers follow Barefoot, Villa Maria or Vega Sicilia on Facebook. What is less often analysed is how these numbers compare to the totality of consumers aware of a brand, and therefore how important the followers number actually is.
To answer this question, we calculated the size of consumer audiences aware of some of the top brands in the USA and the UK (prompted awareness), we then cross-referenced against the number of Facebook followers each brand has in each country. In doing so we can derive a rough measure of Facebook reach: the proportion of followers out of a total awareness base. So, how many consumers aware of a wine brand follow it on Facebook? The answer is: not many at all.
Not surprisingly, Barefoot, the largest brand by sales and awareness in the US market, also has the biggest following on Facebook. Barefoot has a million US Facebook followers, which on its own looks an impressive number. Except when you correlate it with its total awareness base, and realise that 1 million followers is only 1.7% of the total number of consumers aware of the brand. In crude terms, a Facebook post would fail to reach 98% of the brand’s aware base.
Arguably, this still overstates the post’s effectiveness. Consider the following:
a) Being a follower of a brand does not mean you are an “active” follower – you could have liked the page years ago and since forgotten about it.
b) Facebook posts are actually seen by a very small % of a page followers. Organic Facebook post reach is estimated at anything between 2% and 10% with around 11% of them interacting with the post. So a brand with say 2% of its awares on Facebook reaches just 0.1% of consumers aware of it with each post. And interacts with 0.01% of them.
Low reach seems to be the norm; per our calculations, 1.4% of consumers aware of Apothic follow it on Facebook in the USA and 1% of its awares follow La Crema, for example. In the UK we analysed the Facebook reach of two of the most successful brands in the recent years. 0.7% of those aware of Campo Viejo follow it on Facebook and 0.1% of awares of Casillero del Diablo follow it on Facebook. And their sales success has been phenomenal.
So before engaging in discussions about how effective or not social media might be when we interact with consumers, we should start with the question of how many consumers we may reach. How many otherwise valuable consumers bother to follow brands on Facebook? How many consumers would take the effort to interact? How many other ways are there to truly reach consumers in a meaningful way, closer to the point of purchase?
Most importantly, how do we reach those who are not currently aware of us so we can grow our consumer base? (those who like you on Facebook are likely those who already buy you anyway, so you are preaching to the converted). If we learn from the success of Campo Viejo and Casillero del Diablo, they grew, among other things, with campaigns that reached well beyond their consumer base (street food events, outdoor advertising, advertising in cinema and TV). Considering their impressive growth in the market, it looks like they “get” it.
Author: Juan Park