The dividends for a well developed Facebook presence will ultimately depend on marketers investing in adopting sophisticated long-term strategies for customer engagement.

1. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers

2. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers
Executive Summary
As recently as two or three years ago, the idea that brands would provide a social
channel for their customers to engage with them was controversial, even radical. Now
it’s convention. Facebook is a big reason for this change. As of this writing, 56 percent of
Fortune 500 companies host Facebook pages, and that number is growing daily.
Since social customer programs were controversial just two years ago, many of those
companies are new to the experience of engaging with social customers and are looking
to answer the question, “What do we do next?”
Brands that have engaged with social customers in other channels can help us answer
this question. Lithium’s clients have considerable experience with social customer
engagement through brand communities and Facebook pages. Lithium conducted a
survey of its clients to better understand how they see the role of Facebook (and other
social media outlets) in their overall engagement strategy. The results provide an
interesting glimpse into the different roles played by different social media channels,
and potentially into how they will converge in the future. Some highlights include:
ƒ On the whole, respondents rated their communities as more successful than
Facebook at activities that require trust: peer-to-peer engagement and providing
pre-and-post sales purchase support; Facebook was seen as more successful in
disseminating marketing messages.
ƒ The two channels were seen as roughly equal in their ability to create brand
awareness. Clients who have initiated brand communities see awareness benefits
as particularly salient in the first year, suggesting that “newness” of an engagement
channel is in itself a big driver of awareness.
ƒ The ability for customers to submit and discuss ideas for product or service
improvement is the biggest downstream benefit of social customer engagement
for clients who have developed brand communities. Clients who consider their
Facebook efforts less successful are particularly interested in bringing this
capability to Facebook in a more structured fashion.
After Peak Facebook
As Facebook itself approaches full penetration of its core markets and its members
start to regularize their behavior, historic growth rates for participation in corporate
Facebook pages will slow. Call it “peak Facebook.” Recent surveys have also shown that
existing consumers’ engagement with corporate Facebook pages may be tenuous and
fading. For example, 81% of those who have become fans of a brand have abandoned at
least one such relationship because of “irrelevant, voluminous, or boring” marketing
messages.
2

3. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers
This suggests that marketers who are committed to using Facebook to foster
relationships with social customers will need to invent or adopt sophisticated long-term
strategies for customer engagement. Fortunately, many of the techniques learned in
brand communities can carry over into Facebook.
What Is an Online Community?
One of the first questions we see from brands developing a social customer strategy is,
“Do I need both a brand community and Facebook, and if so, what role does each
one play?”
The answer to this question always depends on circumstances and business
requirements, but given that our audience has experience with both venues, we have a
very good sense of the role that each one plays.
improves our search results
creates awareness of our
brand, products, or services
allows us to communicate our marketing
message effectively to customers
creates beneficial
customer-to-customer engagement
empowers customers to help one
another with pre-sales purchase questions
empowers customers to help one
another with post-sales support questions
Gives us metrics we need
to assess program goals
Gives us a good sense of
how our customers are feeling
Helps us identify
particularly valuable customers
Creates goodwill for
our brand in social channels
community effectiveness
facebook effectiveness
Figure 1: Overall effectiveness of Facebook and brand community.
Figure 1 compares the brand community’s perceived effectiveness with the Facebook
page’s perceived effectiveness in 10 different areas.
3

4. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers
The first thing to note is that the one area where Facebook shines is in outbound
messaging. Because Facebook offers outstanding reach and many brands use it as a
publishing platform for periodic updates, its prowess as a vehicle for disseminating
marketing messages is not surprising. Social media marketing vendor Vitrue has
computed that a fan base of 1 million translates into $3.6 million in equivalent media
per year, and brands such as Coca-Cola already see more unique visitors to their
Facebook page than they do to their company web site. In these situations, Facebook
represents a means of message dissemination that compares favorably to advertising
on a cost-per-impression basis.Interestingly, however, Facebook was not cited as
significantly more effective than a brand community in creating brand awareness, or
creating goodwill for the brand in social channels. Given the Facebook platform’s reach
and viral features, one might have expected higher scores for Facebook’s ability to
increase brand awareness, but there are several reasons why the scores may be lower
than expected:
ƒ Brand awareness is still largely campaign driven, and a Facebook page alone does
not constitute a campaign.
ƒ Even when campaigns drive users to Facebook pages and increase the brand’s fan
base, there is no guarantee that these people were new to the brand. Most users
who associate with a brand page probably have a prior affinity for that brand.
ƒ Finally, as we have seen through social media monitoring studies, “buzz” around
brands spikes during successful campaigns, but typically returns to a steady state
after campaigns end.
One further explanation may be that our community clients report that brand awareness
benefits peak during the first year, even as other benefits increase over time. If this
holds true across other social channels, it is possible that the fact of starting a new
program in and of itself is responsible for increased awareness—probably because that
program involves an introductory campaign. When the shock of the new wears off, what
is left?
As it turns out, brand communities annuitize exceptionally well. Peer-to-peer
engagement and an environment where users answer one another’s questions emerge
as a corps of devoted users forms and mobilizes. Indeed, scores rise in these areas as
communities move into their second and third years, suggesting that communities hold
their users’ interest over the long haul.
4

5. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers
anticipated realized anticipated realized
13.5%
27%
46%
78%
pre-sales customer
consultation feedback/ideation
Figure 2: Anticipated benefits versus realized benefits. Peer-to-peer buying advice
and customer ideation were two benefits exceeding client expectations.
The survey tells us that benefits clients anticipated when embarking upon a social
customer program are not always the same benefits that emerge over time. This is
particularly true in two areas: idea development, and peer-to-peer pre-sales consulting.
Customer feedback/ideation was listed as an original purpose of a community 46% of
the time, but a realized benefit 78% of the time. Peer-to-peer pre-sales consulting was
an original purpose 13.5% of the time but a realized benefit 27% of the time.
Both of these “downstream” benefits are most likely to emerge as byproducts of trust
among members of a community. Brands tend to be more willing to harvest and discuss
ideas for service improvement when they trust that their customers are ready for a
sustained dialog rather than drive-by complaints. And people are more willing to trust
product recommendations from their peers when those peers have proven themselves
to be reliably knowledgeable over time.
To see these benefits, brands must cultivate relationships with their social customers
over the long term. While the constraints and affordances of the Facebook platform
and brand communities differ, there is no reason why the aspects that make brand
communities deliver annuitized benefits cannot exist in Facebook. Whether they will
emerge depends largely upon the choices that brands make about how to engage with
their customers on Facebook. And those choices will likely depend on whether brands
consider what they are doing on Facebook successful or not.
5

6. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers
Success/Failure and Future Needs
As we can see from Figure 3, among respondents who consider their Facebook
efforts successful or very successful, three key benefits stand out: the creation of
brand awareness, the ability to communicate marketing messages effectively, and the
fostering of goodwill in social channels. In each of the three cases, there is a wide gap in
perceived efficacy between respondents who are happy with their Facebook efforts and
those who are not. On the other hand, even those who are happy with their Facebook
program do not consider it to be very useful in helping users answer one another’s
questions (either pre- or post-sales) or in helping them identify particularly valuable
customers.
facebook page's community's
effectiveness effectiveness
improves our search results
creates awareness of our
brand, products, or services
allows us to communicate our marketing
message effectively to customers
creates beneficial
customer-to-customer engagement
empowers customers to help one
another with pre-sales purchase questions
empowers customers to help one
another with post-sales support questions
Gives us metrics we need
to assess program goals
Gives us a good sense of
how our customers are feeling
Helps us identify
particularly valuable customers
Creates goodwill for
our brand in social channels
more successful more successful
less successful less successful
Figure 3: Facebook and brand community effectiveness in 10 areas, cross-tabulated
by more successful and less successful overall perceptions of success
Strikingly, only about 12% of respondents who consider their Facebook forays
successful believe that it helps users answer one another’s questions. Fewer than
half thought it created beneficial interactions of any kind among customers. At this
point in its evolution, Facebook seems to succeed or fail for brands based on reach
and the perceived goodwill that goes along with that, rather than on elements that are
specifically social.
6

7. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers
As we can also see from Figure 3, respondents who see their community as successful
or very successful give the community exceptionally high marks for creating beneficial
peer-to-peer engagement, for helping customers with questions, and for providing
insight into customers’ attitudes. Interestingly, there is basically no difference in clients’
assessment of a community’s utility for communicating outbound marketing messages
between those who think it is a roaring success and those who think it is moderately
successful. On the other hand, there is a large perceived gap in the awareness value of
a community between those who feel it is very successful and those who feel it less so.
Perhaps one reason for this discrepancy is that members themselves are the marketing
channel in a brand community. Even though it provides opportunities for outbound
communication—though blogs and tweets—a brand community succeeds or fails on the
basis of its ability to create engagement.
51.4%
answer product questions
50%
42.9%
display status or achievements
8.3%
submit ideas for 62.9%
service/product improvements 50%
search our knowledge base 60%
66.7%
see the best/most useful content 60%
that others have submitted 58.3%
identify other customers with 42.9%
similar backgrounds or needs 50%
find products their friends or 60%
colleagues have recommended 50%
mentions by respondents who rate their Facebook pages as less successful
mentions by respondents who rate their Facebook pages as successful
Figure 4: Additional needs from Facebook by perceived success level with Facebook.
7

8. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers
We can see that when Facebook isn’t seen as successful for brands, its best benefits are
still as an outbound marketing vehicle—just not a particularly successful one. In that
case, what do brands want Facebook to do for customers that it’s not doing? We asked
respondents to rank various things that their customers might do on Facebook that they
can’t do or can’t do well. When we correlate those rankings with the level of success
those clients are currently enjoying with Facebook, several things stand out:
ƒ Overwhelmingly, brands whose Facebook efforts are flagging want some way to
recognize their customers’ status and achievements on Facebook—in other words,
to reward good behavior. Conspicuous display of status and achievement is a
deeply ingrained feature of Lithium communities and is generally seen as a prime
motivator of consumer participation.
ƒ Respondents who do not see their current Facebook efforts as successful see the
ability for customers to submit ideas as substantially more important than those
who are satisfied with Facebook. Again, this maps very closely to the ideation
benefit we saw earlier as a downstream effect of brand communities.
ƒ The ability to find products or services recommended by friends or colleagues is
also seen as a potential area of improvement by those who are not particularly
satisfied with their Facebook efforts.
47.6%
answer product questions
56%
52.4%
display status or achievements
20%
submit ideas for 57.1%
service/product improvements 64%
search our knowledge base 57.1%
64%
see the best/most useful content 57.1%
that others have submitted 60%
identify other customers with 38.1%
similar backgrounds or needs 52%
find products their friends or 47.6%
colleagues have recommended 64%
mentions by respondents who rate their communities as less successful
mentions by respondents who rate their communities as successful
Figure 5: Additional needs from Facebook by community success level.
8

9. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers
As we can see from Figure 5, brands who are less successful with communities also
want to see a more prominent display of status and achievements on Facebook. But
what is perhaps more interesting is that clients who are at higher levels of success with
brand communities are much more interested than their peers in introducing the ability
for users to find others who resemble them, and the ability for users to locate products
that their friends and colleagues like. These are characteristic “social networking”
features.
In other words, when Facebook efforts are not successful, brands want Facebook
to behave more like a community. When communities are successful, brands want
to benefit from Facebook’s networking features to a greater extent. If Facebook’s
potency as a generator of awareness begins to decline over time, that trend suggests
a convergence between the interaction modes in Facebook and those of brand
communities is extremely likely.
Organizational Ownership
If we see a coming convergence between the way people interact on Facebook and
the way they interact in a brand community, it is worth asking who will lead that
convergence and how it will take place. Enterprises vary in their determination of who
owns social customer initiatives. In some organizations, social customer initiatives are
owned by customer support or customer experience teams. Increasingly, however, they
fall under the purview of marketing or corporate communications functions.
61.5%
answer product questions
36.8%
46.2%
display status or achievements
21.1%
submit ideas for 73.1%
service/product improvements 42.1%
search our knowledge base 73.1%
47.4%
see the best/most useful content 69.2%
that others have submitted 47.4%
identify other customers with 50%
similar backgrounds or needs 36.8%
find products their friends or 61.5%
colleagues have recommended 52.6%
customer support and experience groups
marketing groups
Figure 6: Additional requirements from Facebook by social program ownership. 9

10. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers
As we can see from Figure 6, organizations where marketing owns social initiatives are
demanding less of Facebook in terms of new modes of customer engagement. In fact,
ownership by marketing is more important than the perceived success of a company’s
Facebook page in determining whether a company is interested in customers engaging
through Facebook in more involved ways. Customer support and customer experience
groups continue to be more interested in the exchange of ideas and the answering of
product questions.
customer support and experience marketing and comms
a f
f
e b b
e
d
d
c c
Figure 7: Largest challenge with social customer programs, by program ownership
a) executive buy-in
b) resources to scale our efforts
Marketing-led organizations’coordination acrosswith social customer programs is how
c) biggest concern teams and departments
to scale them. Figure 7 shows the chief concern as scaling initiatives with (relatively)
d) too many tools
less concern about coordination across teams metrics and standards for of marketing-led
e) lack of agreed upon and departments. 44% success
f) lack of customer interest
organizations cited “resources to scale our efforts” as the biggest challenge, as against
34.4% of everyone and (9/34 - 26%) of non-marketing led organizations. This suggests
that one reason marketers are less aggressively pursuing “deeper” engagement
through Facebook is that, unlike support or customer experience organizations,
they lack human resources—like contact centers—that are perceived to be required
to ensure that social customers get the satisfaction they require from engagement
through Facebook. Better, perhaps, not to hold out the promise of a sustained dialog
with customers if an organization cannot make good on that promise.
The survey shows that marketers and customer experience are equally committed
to responding to customers in brand communities and through Facebook and
Twitter. However, it would not be surprising if Facebook’s reach threatens to become
overwhelming if customer actions on Facebook called for a response. Indeed, perhaps
10

11. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers
one thing that marketers have learned with online communities that they have not (yet)
learned with Facebook is that customers themselves can be the solution—not just the
cause—of the scaling problem. Time and again, we have seen that larger communities
with a devoted core of superfans actually require less intervention from companies
than fledgling communities. The “downstream” trust benefits pay dividends. There is
no reason why this shouldn’t be so on Facebook, but many organizations are in earlier
stages of their experience with Facebook.
brand communities
facebook
twitter
youtube
linkedin
customer support and experience
marketing and corp comms
Figure 8: Requirement for ROI measurement by channel and program ownership.
A final area in which brand communities differ from other channels for marketing-led
organizations is in the need to prove themselves through ROI metrics. As we can see
from Figure 8, marketing-led organizations generally have higher demands for ROI,
but this is particularly true for brand communities. We suspect this is a function of the
perception that Facebook engagement is free because a Facebook page is itself free, but
also of the maturity level of Facebook as a technology and a marketing venue. As we see
increasing convergence of social channels, we should also expect to see demands for
more sophisticated Facebook measurement tools, and growing demands for Facebook
to prove its value.
11

12. Facebook and Beyond:
Lessons for Brand Engagement with
Social Customers
Conclusion
There are significant synergies between Facebook and brand communities. Both offer
unique marketing advantages, and we’ve helped customers extend the reach of their
brand communities on Facebook. For its sheer size and viral features, Facebook is
generally considered more successful at disseminating marketing messages, and is
roughly equal in its ability to create brand awareness. As we’ve seen in online venues
before, however, driving people to a social site without providing an outlet for their
needs invites a peak-and-trough customer engagement, rather than a sustained,
vital and profitable enthusiasm. A campaign-based wave of awareness will eventually
peak and subside, and may then create unrealistic expectations for customers.
As these channels evolve and the awareness benefits subside, marketers should
consider Facebook a useful platform for cultivating an online presence run more like a
community than a campaign.
The dividends of a well-developed Facebook presence will ultimately depend on
marketers inventing or adopting sophisticated long-term strategies for customer
engagement, such that their Facebook presence derives its value from peer-to-peer
relationships. But those relationships also have to be based in trust, both among
customers and between customers and the brand. Establishing this trust is a key, long-
term strategy. For instance, fostering productive peer-to-peer relationships among
customers and rewarding positive behavior helps to create trust, as does identifying,
motivating, and highlighting your brand’s superfans. The downstream annuities of trust
and engagement only grow when brands cultivate true, multi-directional relationships
with their social customers over the long term. The potential ROI is tremendous.
Lithium
lithium.com | 6121 Hollis Street, Suite 4, Emeryville, CA 94608 | tel 510.653.6800 | fax 510.653.6801
© 2011 Lithium Technologies, Inc. All Rights Reserved. 12