Social network value per user – how much is your audience worth?
Gone are the days when social media was a ’nice to have’ for a business. Like most internet based tools, it is now a necessity which your customers will not only expect, but also possibly take for granted. Proving its ‘worth’ to the C-suite and investors is (thankfully) now not a challenge as long as you can justify your activities and demonstrate how it is benefiting your business.
In this blog, we don’t look at ROI as such, but specifically at what the social network value per user is worth to a business, based on the stats which are out there.
- 1 bn people are active on Facebook
- 100 m use Instagram every day
- 500 m tweets are sent each day
- 260 million LinkedIn users log in each month
- 1 bn hours are watched daily on YouTube
- Google+ is going in April
How much is your social media fan base worth?
The social network value per user can change hour by hour. Similar to the stock market, one day your fan base can be worth a mint. Then, a scandal breaks and it drops. That said, the information behind that that value is getting harder to find. So, this is what we could report on:
When we first wrote this blog back in 2015, Facebook was calculating a user to be worth $3.73 per quarter. By the end of 2017, this was up to $6.18 per user. That’s a 165% increase in two years. Obviously, last year saw the Cambridge Analytica scandal, GDPR and people genuinely losing their trust in the platform. But, this didn’t stop advertising spend. When the 2018 stats are released, it will be interesting to see if the trend is still growth or whether it stagnated whilst that trust was restored.
This is an interesting one to look at. It has been reported that Instagram has an estimated value of $100 bn making one of their 900 bn users worth $90. But, that is a crude way of looking at things. Influencers on Instagram can commard anything from £100 – £10000 per post based on an approx 10000 – 1000000 follower count. This puts the average social network value per user at just 1p! Admittedly, this is a tricky one to work out. This is especially true if you consider how Instagram is plagued with fake accounts and robots. So, we would assume that the social network value per user would be less than its big brother, Facebook. But, it is quickly catching up as brands are starting to favour this platform over most of its competitors.
Social network value per user stats for Twitter are impossible to find since they ‘floated’ the company. In 2015, it was worth $4 per user. We would expect that, with their increase in advertising revenue and as it is the top social site for news, that this number has since grown.
Since Microsoft took over LinkedIn, its value as a networking and lead generation tool has gone through the roof. This is also supported by its USP as the only ‘professional’ social networking platform out there. So, we can expect that the value per user here is considerably higher. Whilst it was once dubbed as a B2B tool, this mindset towards LinkedIn has changed more towards human to human. Why? Well, someone like me may be on there to recruit for business or to connect with people who I want to learn from or work with. But, I am also a consumer. So, if you are a B2C business, do not discount the value of having a robust LinkedIn network.
If you choose to monetise your YouTube channel, you get paid per view. This can make it easy to gauge how much your ‘video’ or ‘channel’ is worth based on those viewing figures. A video view on YouTube is worth approx $0.006 – $0.015. But, does someone viewing your video ultimately make money for your business (other than this viewing money)? Not necessarily.
What does this mean?
Every click to your website counts but not every fan or follower is created equal.
Ultimately, each social network has a different function. They are all at varying stages of maturity with regards to advertising, they utilise adverts in a number of ways and they also attract a variety of different audiences. So, to truly find out the worth of your audience, it is best to measure it through the ROI of each platform against your specific business goals.
So, if your Facebook page has 1,0000 fans and you are only getting five likes per update and zero referrals to your website each month, it is pretty obvious that not all of your fans are worth $6.18 per quarter.
Engagement and website referrals rule over fan or follower numbers. A business should be happy if it has 300 fans yet 50% of them take action on each post or a high number of that percentage converts into a sale, over higher numbers for vanity’s sake.
However, that doesn’t mean that a user from Facebook is four times more important than a fan from Twitter. Surely, a click is worth the same if the audience and tactics are right?
If you are noticing a decline in engagement, it may be time for a social media audit. This will check to see who you are posting to as well as what is or is not working with your audience. Ask yourself whether they are your target audience? How were they originally acquired? Do you need to rethink your community growth strategy?
In a nutshell …
As a business, unless you are looking to sell that business, working out how much your audience is worth is … not worth it.
Ensuring that you are producing content that encourages the right audience to engage and convert is a more fruitful task. Like all marketing activities, you need to look at your social media in line with your business, marketing and channel goals and track conversions from your website.
This will provide you with a clearer indication of whether your efforts are paying off as they should be.
July sees another Independent retailers month come around which was born to give voice to, well, independent retailers. Click to find out more.
Before we look at how to target affluent consumers on social media, we must define who they are. Click to read further on our blog.
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