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Wednesday, November 23, 2011

Value of Facebook fan to a business? $10/each

A new study looked at more than 5 million Facebook ads placed by 50+ clients from May-September of this year, the study looked at the cost of acquiring new fans, and what it took to get them to perform a desired action.

In calculating the value of a Facebook fan, the study found it to be $10 per fan, assuming a constant cost-per-click of $1.

The article states that fans, unsurprisingly, perform desirable actions such as installing an app, voting in a contest and making a purchase at a much higher rate, and it's significantly cheaper to prompt them to do so through advertising than it is to prompt non-fans.  Specifically, fans are 291% more likely to engage with a brand than a non-fan.

Facebook fans are more likely to engage in deeper actions. Source: SocialCode   

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