Last Tuesday, our head of sales forwarded a conversation Mark Cuban, tech billionaire and Dallas Mavericks owner, had with Dan Lyons for ReadWrite – saying that he’d be moving his business away from Facebook.
We were a little worried because we’d just signed a deal encompassing the Facebook pages of a bunch of Cuban-owned properties, including the Mavs and HDNet, the day before. I took a quick read through the blog and had a couple of thoughts:
Facebook Needs to Prove Value Before Taking a Toll…
Cuban acknowledged that Facebook is an important venue for brands (good news for us!), but didn’t see why he should have to pay to reach them. A lot of brands feel the same way. They’re spending time and money to organically build strong fan bases on Facebook. Shouldn’t they be able to reach out to those fans without being charged for it? Most probably feel that way because Facebook hasn’t yet established a solid connection between fan growth / engagement and bottom-line return.
We face the same issue when discussing our platform with potential customers. And given how new social marketing is, we feel like it’s our job to help prove the connection. That’s exactly what we did when we were courting Cuban’s social marketing team. We highlighted a few performance benchmarks – like the fact that Offerpop campaigns deliver organic fan growth of 10-15% for brands with huge fan bases, vs. the Facebook average of 2%. And that we typically deliver 15,000 qualified email addresses per campaign. Then we gave them free access to the platform. Now they’re a customer, and it’s our job to demonstrate continued value across the key performance metrics that are important to them.
…But They Do Deserve to be Paid
Brands are beginning to treat Facebook like any other marketing channel – moving beyond Likes and looking at how the platform delivers on performance. This usually means bringing in members of the marketing team who are more focused on return, like their email and search marketers. And those team members are discovering a lot of value. One simple example – according to the DMA, the cost of acquiring an email address for a B2C company is $8.73. So the value of email addresses collected via a typical Offerpop campaign is probably $120,000 on the low end (15,000 emails x $8 per email address). But the average cost of such a campaign comes in at a fraction of that – probably around $5k, including our rate plus the customer’s time and effort.
This kind of value is possible because Facebook has created a pretty amazing platform. So they probably deserve a few bucks when brands decide to amplify campaign reach. I’m sure Cuban would agree, if someone just walked him through the numbers.