I was invited to present at Wharton’s Future of Advertising project, empirical generalizations II and choose to focus on the brand impact from Facebook.  I partnered with Compete, Inc. leveraging their panel of 2MM for this analysis.

The first thing to note is that my assumption about people who like a brand on Facebook already being predisposed to that brand turned out to be true.  They are 8X more likely to already be interacting with the brand’s website vs. non-fans.  This creates an analytic challenge, because you need to control for this in determining if liking a brand on Facebook CAUSES any increase in value to the brand, otherwise you will way overestimate the impact.

We studied 63 brands across 4 months in beauty, food/restaurant, and retail (sectors where sessions on owned media lead directly to sales). This is the first study that precisely measures the effect of liking a brand as it looked at the same person’s clickstream behavior towards a brand for 30 days before and 30 days after they liked that brand.

So here is what we found.

There IS, in fact, an 85% lift in the number of sessions on a brand’s website within 30 days of becoming a fan of a brand on Facebook. Liking a brand on Facebook DOES matter.  However, the effect all comes from the small subset who return to the fan page.  For them, there is a four-fold increase in their visits to that brand’s website after liking the brand.  Likers who did not return exhibited virtually no increase at all in website visits.

Our study also found that those returning to the brand page tend to be a small percentage of fans so the overall impact on brand website sessions is modest under current marketing approaches.

The fact that a second visit to the brand page is needed to create impact suggests that Facebook social impressions in a fan’s newsfeed have little impact beyond their role in encouraging a return visit to the fan page. The inferences I draw from this is that every Facebook brand newsfeed update should offer a reason for a fan to go back to their brand fan page and the page itself should encourage stickiness.

“This research clearly indicates that marketers must be focused on not only increasing the number of total fans, but on driving repeated interaction with the fan page.  It is this repeated interaction that leads to measurable lifts in visitation to owned media properties”, says Mike Perlman, Vice President of Agency & Publisher Solutions at Compete.

This research also has importance measurement implications.  It supports the need for a metrics approach I have trademarked called “Tyme with brand” ™ that is intended to measure the patterns and quantity of time that people spend with a brand, going beyond the gross number of impressions that marketers get via social media.  If you do not measure tyme with brand, a marketer will certainly overestimate the importance of social media vs. owned media.