Measure Word of Mouth in Facebook

Article Courtesy of Fast Company.

Among the tools Facebook is releasing today in conjunction with New York's annual Advertising Week are a new dashboard to measure the reach of individual Page posts, an API to allow third-party agencies build their own tools on top of this new Facebook data, and a new ad unit that allows companies to create ads out of their Page posts.

Companies set up Facebook Pages to market themselves. But until now, they’ve only had fairly blunt instruments--like the number of Likes--to measure how well they’re doing. Now Facebook is releasing a new set of tools that the social network says will give marketers better insights into how well their Pages are reaching Facebook users--and ultimately make those Pages more useful to brands.

Among the tools Facebook is releasing today in conjunction with New York's annual Advertising Week are a new dashboard to measure the reach of individual Page posts, an API to allow third-party agencies build their own tools on top of this new Facebook data, and a new ad unit that allows companies to create ads out of their Page posts.

The tools reflect the company’s increasing emphasis on driving sharing among users--an area of focus CEO Mark Zuckerberg announced this summer, saying that the company now views the amount that people share on Facebook as a stronger indication of the value of the network than the previous metric, which simply measured the total number of users.

“With the new Page Insights, Facebook is emphasizing the importance of sharing on Pages, because this increases a brand’s reach,” the company said in a press release.

The new dashboard, called Insights (pictured, right), appears as a tab on the company's Page and is only available to adminstrators of the Page. The Insights tab lists the Page’s total number of fans ("Total Likes") and the total number of other people reached via those fans ("Friends of Fans"). It also offers a ticker to show whether those numbers are going up or down.

With the Insights tab, Facebook is launching a new metric: “People Talking About This,” which doesn’t just measure how much people are talking about the Page in the conventional sense (such as a user commenting on a post on the brand’s Page). It also includes all the activities that Facebook considers a “conversation”--things that indicate a user is in some way engaged with the brand.

Among the activities that fall under that the umbrella of a “conversation” are: Liking the Page; posting to the Page’s Wall; liking, sharing, or commenting on a post; RSVP’ing to an event; photo-tagging the Page; checking in at the brand’s Place; and Liking or sharing a check-in deal.

Facebook says providing this data, particularly at the individual post level, will allow companies to measure the impact of their posts and, ultimately, help them create posts that do a better job of going viral. “Research shows that word-of-mouth conversations among friends are the most influential for getting a brand’s message across,” the company said in its press release.

Indeed, Facebook cited comScore research showing that fans and friends-of-fans of a Page are more likely to “visit a store, website, and even purchase a product or service.” Fans and friends-of-fans of Starbucks spend 8% more in stores than the average Starbucks customer and transact 11% more frequently, the company said.

The data supports Facebook’s overall premise: that the social network is a valuable place to market, because it allows companies to activate user word-of-mouth at a scale previously never possible. Indeed, the company has previously said that Sponsored Stories, a category of ads that show Facebook users which of their friends already Like a certain brand, perform twice as well in engaging users than do generic ads on the network.

To that end, Facebook is also today releasing a new premium ad unit that allows brands to turn their posts into ads. If the ad is put in front of a user who has a friend who is a fan of the brand, the ad will include that information in the ad (pictured at the top of the image, right)--thus, Facebook says, “combining the brand's voice in the ad with a friend’s voice.”

According to the social network, this kind of “social context” results in a 68% increase in people recalling the ad, and people who view these kinds of ads are four times more likely to make a purchase than people who see generic ads.

Also, today, Facebook is releasing a “Page Insights API” for outside agencies and developers at brands that have access to certain kinds of (anonymized) Facebook data. The agencies, including Context Optional, Wildfire, and Webtrends, are part of a growing ecosystem of third parties that are building powerful tools for marketers using Facebook data, further accelerating the value that brands get from running campaigns on the social network.

“The updates will enable marketers to discover which publishing and ad strategies on Facebook are creating the most engagement and growth,” Context Optional said in a press release.