Facebook Fans Provide a Good Return on Investment, Study Says

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I've never been a big fan of Facebook either for personal or business use, but a new study suggests that advertising on the social networking site could be well worth your while if you run a business.


Specifically, each fan a business gains on Facebook leads to an average of 20 additional visits to that company's website in a year, according to new data from metrics firm Experian Hitwise.

"We are constantly asked, 'What's the ROI with advertising on Facebook?' and until now that has always been a difficult question to qualify precisely," wrote Robin Goad, research director for Hitwise U.K., in a blog post on Thursday.

Those additional visits, in turn, generate extra sales both online and offline, Goad added.

Up to 54 Percent More Likely

To come up with its results, Hitwise took the top 100 retailers ranked in its Hitwise Shopping and Classifieds category and benchmarked visits to their websites against the number of fans they had on their respective Facebook pages.

It also examined people's propensity to search online for those retail brands after visiting Facebook.

For the 12 weeks ending June 18, what Hitwise found was that among the retail brands most actively marketing on Facebook -- most of them were in fashion, it noted -- consumers were as much as 54 percent more likely to search for those firms online after a visit to Facebook than they normally would be on Google, Yahoo! or Bing.

Even without any Facebook fans, however, retailers still receive an average of 62,000 visits from Facebook each month, Goad pointed out.

Along with announcing those results, Hitwise on Thursday also launched a new service in partnership with social media firm Techlightenment to help brands acquire new Facebook fans and then analyze their behaviors online.

Proceed with Caution

Hitwise's study was, of course, conducted in the United Kingdom, and on consumers there. Still, it paints an interesting picture that's unlikely to be too different in many other parts of the world.

I maintain that there are still plenty of reasons to be very cautious marketing on Facebook: the constant privacy issues and the prevalence of young kids on the site, for instance, among several other concerns.

Given this new data, though, it's hard to deny that marketing on Facebook pays off for some. The devil, as always, is in the details, and making sure you don't get burned.

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