Fan brands guide to Facebook commerce

The Fan
Brand’s Guide
to Facebook
Commerce

ISSUE 1
JULY 2011
1

CONTRIBUTORS
Tim Putnam Marcus Whitney Matt Sullivan
Vice President of Client CTO and Co-Founder Client Services Manager
Services at Moontoast of Moontoast at Moontoast
twitter: @thetcp twitter: @marcuswhitney twitter: @matt_sullivan

Brad Posey
User Interface Designer
at Moontoast
twitter: @bradposey

TABLE OF CONTENTS
F-Commerce Is the First Frontier of Distributed Social Commerce 4
The Economic Drivers of Facebook Commerce 5
Finding Success With the Facebook Conversion Funnel 6
The Facebook Fan Engagement Spectrum 9
The Anatomy of a Fan (infographic) 14
So What’s This EdgeRank Thing All About? 17
Content Drives Facebook Commerce 19
Social Media Listening on Facebook 20

F-COMMERCE IS THE FIRST FRONTIER
OF DISTRIBUTED SOCIAL COMMERCE

S ocial Networks, Content Networks and
Smartphones are empowering consumers
to find, research and transact with your brand in
But you can’t be successful without
understanding the rules of engagement, and
believe me… there are rules. Understanding
ways never before possible. And consumers are concepts like EdgeRank, The Fan Engagement
choosing to use their new found power. Spectrum, Facebook’s Economic Drivers, and
what the conversion funnel looks like in Facebook
Distributed Social Commerce is how you will are critical to your success in F-Commerce. So is
meet your consumers where they want to be met, having the right tools.
and deliver the offers that they want from you,
before your competitors can. There are many brands who have been using
F-Commerce with great success in Music,
Facebook has enabled people to build and Publishing and Retail. To be successful with
maintain relationships with other people and F-Commerce, it is imperative that the commerce
brands in a way that no online platform before element is seamlessly integrated with a solid
it has. Facebook learns about us through our social media strategy. Brands we have seen that
interactions with other people and brands, and are owning F-Commerce have great engagement
keeps us engaged by never looking the same with their fans and are having real conversations
when we visit it. We, the Facebook members, with their communities. Commerce is now being
are rewarded for contributing to the collective used as a rewards tool.
intelligence of Facebook with likes, comments
and shares, with more relevant content in our This is a new era.
news feed and better suggestions for friends we
should request and brands we should like. It’s an Consumers are very much in control and they are
amazing system. dictating where they will engage with a brand.
Many brands are now advertising their Facebook
Imagine now harnessing that collective intelligence, Fan Pages instead of their websites. Social Media
with the goal of finding and serving your most Marketing was yesterday (if you can believe it),
valuable customers. That’s what F-Commerce is and Distributed Social Commerce on Facebook
all about. is Now. Seize the day!

4 | The Fan Brand’s Guide to Facebook Commerce Tweet This E-Book

THE ECONOMIC DRIVERS OF
FACEBOOK COMMERCE

W e are trying to make this as simple as
possible, friends.
their info) with the offer? You’ll have to try lots
of offers to find your sweet spot, so don’t get
jaded if the first one or twenty don’t work. This
No business is easy. There are always factors is a learning process, and once you nail it, it’s
beyond your control that can impact how well a great revenue stream and low-cost customer
things will go for you in your business. And then acquisition channel.
there are the drivers. We keep pointing to the
drivers, because they give you a simple way to Placement - How did you integrate the offer into
assess your opportunity, and your performance your brand’s social experience? Will fans find
against your opportunity. it? Is it surrounded with social triggers that can
inspire sharing? Did it come across as relevant
In our experience, there have only been four (4) with the surrounding content? Did it appear
key drivers that we have had to measure, both at an ideal time to drive the most traffic? All of
qualitatively and quantitatively, to determine how these things matter big time when it comes to
successful a social commerce campaign can be, seizing the opportunity of your Social Commerce
and how well we’ve actually done. Behold: campaign.

Audience - Qualitatively, you need to understand Virality (new word, gotta love the Interwebs) –
how engaged your audience is and what How easy and compelling is it for the offer to
their threshold for buying directly from you is. be shared, thus expanding the audience and
Quantitatively, you need to understand how growing the overall opportunity.
many of your total audience you are able to
actually reach. Both of these can be determined These are the only things that we focus on
(approximately) from previous social interactions when working with partners to build great Social
and marketing conversion metrics. Moontoast Commerce campaigns. Keeping it simple
helps you get concrete results by monetizing lets you measure and improve towards Social
directly, to add another dimension to the data Commerce excellence, which we all want. So let’s
points around your audience. But Moontoast keep it simple friends, focus on the drivers.
(or anyone for that matter) can’t monetize a
disengaged audience, or an audience too small Have you been measuring your drivers? If so,
to get meaningful results from. how do you think you’re doing? Let us know.

Offer - What are you offering? Is it compelling?
Does it have game dynamics tied to it to motivate
your audience to engage (buy, share, give you


FINDING SUCCESS
WITH THE FACEBOOK
CONVERSION
FUNNEL
Now that we understand the Economic
Drivers of Facebook Commerce, let’s talk
about the Facebook conversion funnel.


T he keys to leading a person from casual
user to Liking a page, and through making
a purchase, lie in having a solid social strategy
turn, your community will grow. We believe
authenticity, consistency, and great content
that encourages a reaction are big drivers in
and compelling offers that your community gets developing a community. Posts with photos and
excited about. So how can your organization use videos encourage sharing, and therefore expand
those, regardless of size, to be successful in your a brand’s reach. An authentic brand voice will
own efforts? build trust, leading the casual brand fan to have
a deeper sense of personal ownership which
Let’s take a look at the following factors and how makes them pay more attention when your
they can be applied to marketing on the world’s updates crawl down their news feed.
largest social network:
Getting Direct
Liking with Limited So you have a community. Your fans are your
Why is Black Friday so popular? Because a fans for a reason. They like your products, your
limited quantity of product is available for a great customer service, your stores, your marketing,
price. There’s only so much of it to go around, so and any number of other things. You are the
people freeze their bums off outside of Target at authority on your brand and your fans want to buy
3:00 in the morning just to get a $20 toy. Scarcity from you.
is a powerful tool.
Why deny them that? Take out the middle man
What do you have that’s scarce? Maybe you and go where your fans are gathering. That
have an awesome backlog of merchandise that’s way, you’re in control of the experience. Fans
been collecting dust in the warehouse for years. appreciate that experience much more than just
The fewer, the better. This is what drives impulse buying your wares at a big box retailer.
buys in social commerce. If your customers know
they can’t get it anywhere else and there’s only a
handful left, they are much more likely to buy. Facebook Commerce is not
Scarcity will attract new Likes (and customer about constantly posting
acquisition) as word of the offer spreads.
your products or services
Quality Over Quantity
Popularity is a tricky thing and a little relative. A
to your Fan Page. It’s about
brand with 20,000 fans on Facebook is popular building a community...
compared to one with 100 fans, but pales in
comparison to the brand with 20 million fans.
This is a big factor in the conversion funnel.
It’s really about what you do with your fans and People buy from the source because the sense
less about how many you have. Do you think of trust is very high. A great social experience
a brand like Timberland is any less effective at that ends with a sale builds affinity and is an
accomplishing a social commerce goal than opportunity for brands to build repeat business.
Coca-Cola just because they have only 425,000 Note I said “experience”. The experience flows
Facebook fans compared to Coke’s 32 million? all the way from the initial introduction to the offer
through the message a person receives after the
Engage with your fan base and continue to transaction. Be solid here and you will see that
offer a unique and awesome experience. In person again.


Friends get Benefits When it comes to Facebook Commerce, you
It’s simple; reward your fans for being loyal to your need to just keep at it. Your fan base is built over
brand. Think about what you are a fan of. What time, and the best way to build that base is by
makes you feel appreciated for being a fan? staying top-of-mind. This can be in the form of
polls, photo caption contests, giveaways, quotes,
This doesn’t have to cost you a fortune. In choosing a fan of the day, anything that gets your
fact, many of the best rewards are simple and fans involved.
affordable. Wufoo is famous for sending thank you
cards to random customers. What does that cost Facebook Commerce is not about constantly
them per card? Less than a buck? posting your products or services to your Fan
Page. It’s about building a community that, when
Get creative! The best part about social the time is right, is open to doing business with
commerce, and Facebook Commerce specifically, you. When used well, the Facebook conversion
is that it’s completely open to interpretation. There funnel is a loop. By being smart with the offer and
are no rules, but there are things that just work. providing a great experience along the way, you
Find what works for your brand and make it a part can train your audience to expect to shop through
of your overall strategy. your Facebook page.

Be Regular Now go. Be awesome.
The key to success in any endeavor is
consistency. As Woody Allen said, “Eighty percent
of success is showing up.” We think that number
is even higher.


BRAND

THE FACEBOOK FAN
ENGAGEMENT SPECTRUM


L ikes and comments. That’s the first thing we look at when someone asks
about engagement on Facebook, right? Okay, maybe community size, then
Likes and comments. The truth is that measuring community engagement on
Facebook is much deeper and more complicated than that. Let’s take a look at
what engagement looks like from a numbers perspective, then drop some ideas
on how to get better and more repeat interaction with those beautiful people who
have publicly told your brand, “Hey brand, I like you.”

Engagement by the Numbers

Our numbers match up with other analysts pointing out that community engagement on the whole
sits a little over 3%. That means that out of all of a brand’s fans, each post might have 3% of their
audience engage with it. And that’s if it’s a GOOD post. Of course there are things you can do to
bump up your EdgeRank, which helps your posts to be seen by more people, but we’ll assume
you, as a social media marketer, are doing a pretty stellar job talking to your community. 3%. Not
necessarily the same 3% with each post, but 3%. It varies by community, but 3%.
There is a fascinating series of blog posts by Michael Wu over at lithosphere.lithium.com about
looking into deeper metrics to find superfans within the engagement spectrum on Facebook. He
takes a look at things like comment thread depth, repeat interactions within the same post, timing
and velocity of those interactions, and Facebook as a community for brands verses a social
network…that is, pre-established relationships (social network) vs. opportunity for relationship
growth through engagement (community building). Several of his stats stand out:

30% of active fans reengage with Only 9.6% of fans return to the same
fan pages. That means 70% of fans conversation on a fan page. 90.4% of
post once to a brand page and never active fans post once in a thread and
return. never return to the conversation.

He points out that, while social, Facebook is not inherently designed to be a relationship building
website. Because the news feed falls down the page so quickly, it’s very difficult to create and
maintain meaningful conversations. From that view, a 9.6% return rate makes sense (and even
sounds a little high).


The Case for Facebook Commerce as a Relationship
Sustainability Tool.

We talk a lot about rewarding fans for publicly saying they like you. The process of liking a brand
is not difficult. A button falls in front of you and you click it. But the emotional high five that comes
along with it, we think, is highly underrated by brands.
We get so caught up in the number of fans we have that we forget these are PEOPLE who are very
much alive. We have the opportunity to superserve them because by Liking us, they have also
admitted they’d like to be entertained by us or learn from us or be treated like VIPs by us. It’s a
remarkable opportunity.

The Fan Engagement Spectrum

We believe communities can beat 3%. First we have to look at a brand’s audience and how fan
behavior and engagement travels through various engagement levels. We believe in a Leap 5
social commerce philosophy. What we mean is there are 5 types of fans which are at different
levels of engagement.
• Superfans
• Purchasing fan
• Advocate fan
• Engaged fan
• Potential fan

The Path to Superfan Starts with Reach

1. Reach (Potential Fan Opportunity) – A key to growing your base in any medium is reach. Quality
of channel is also critical, but the Social Graph creates an efficient, high quality, word of mouth
channel. So the key here is measuring and growing your reach constantly. Key metrics include:
• Monthly Active Users
• Total Fans
• Total Fan Network Size
• Count of Shares, Likes and Comments per post


We get so caught up in the number of fans we have that
we forget these are PEOPLE who are very much alive.

2. Interaction (Potential Fan -> Engaged Fan) – Once a fan has chose to “like” the brand, they must
be driven to engage. Key metrics include:
• Plays
• Page Loads per fan
• Count of Shares, Likes and Comments per fan
3. Conversion (Engaged Fan -> Purchasing Fan) – After engagement, ROI becomes critical.
Driving sales from impressions and cart building are key metrics to watch:
• Conversion from Impression
• Conversion in cart
4. Revenue & Referrals (Purchasing Fan -> Super Fan) - The power of Social Commerce is
empowering fans to promote the brand to their networks, as well as making it effortless to have
great buying opportunities over and over. Super Fan metrics to watch are:
• Average Cart Size by fan
• Frequency of purchase by fan
• Total sales by fan
• Referred members by fan
• Referred buyers by fan
We believe the tools are there – Facebook has built-in engagement and what they don’t have, they
let you link to. Tools + Caring + Consistency = Relationship Building. Here are the ways we engage
fans on Facebook:
• Surveys – ask your community questions – do you like this or this? Don’t be afraid to go off-
topic and speak to current events. The conversation does not have to be exclusive to your
brand.
• Photos – share photos of live events, behind the scenes at the office, photos that prompt
comments (what do you think of this?), and photos of new products. Ask questions in the
title or description of the photo and participate in the comment thread – answer questions or
comment back multiple times as your community comments.
• Videos – Use a similar strategy to photos…or take a queue from the Old Spice Guy and make
custom videos for specific users in your community based on a question they ask.


• Comments – Comments are what started social. Each piece of content created can have
comments. Use them. Jump in to your community’s posts and comment on them. Then react
and interact with comments on your own wall. We’re aiming for conversation that takes the
relationship to a deeper level.
• Free Downloads – offer communities something for free. Free is the first step toward
commerce, you know. Some of our most viral campaigns have been free offers that let people
discover new offers from their friends. Friend-to-friend marketing is the essence of social.
• Commerce – You signed up for Rue La La or Gilt Groupe, didn’t you? You want that discount.
You crave the well-fashioned sales opportunity and limited quantity. You want to receive
notices every day of what the next sale is shaping up to be. Learn from the wave of discount
retail sites and implement similar strategies to your Facebook page.
The case for Facebook commerce sneaks in there when you empower your Facebook page to
reward those fans with great offers. That could be deep discounts, items only sold to Facebook
fans, limited edition or autographed items, etc. Teach a community to show up every Tuesday at
10a.m. for a deal, and you’ll reach an entirely new level. Commerce is a great way for a Facebook
fan to get a payoff. Suddenly, it’s worth it. That emotional high-five got them in the door. That’s
when you push the pedal to the floor and build affinity.

To Sum Up

At the highest level, fan count (Liking a page) is not a good metric for engagement. Community
engagement (likes and comments) on average sits around 3%. To increase interaction with the
fan, utilize different types of content to drive conversations that deepen the relationship with the
community and drive potential fans to superfans. Introducing commerce as part of your overall
social media strategy is a fantastic way to reward fans and create buzz about your Facebook page.
This all requires an understanding that the world we live in today makes it easier than ever to have
real relationships with global customers and to increase brand affinity. Treat customers well and
word will spread.


SO WHAT’S THIS EDGERANK
THING ALL ABOUT?

M arcus was on a social media panel with the
top execs in the industry discussing social
commerce and the conversion of Likes in to
The first is affinity. Basically, if you spend more
time talking with certain friends on Facebook by
posting to their wall, your affinity with those friends
dollars. One topic he brought up was Facebook will be stronger.
EdgeRank. It’s not exactly water cooler talk, so
we’ll explain the basics here. The second factor is what Facebook calls weight.
Weight is essentially the level of interaction a piece
When you view your wall in Facebook, the of content gets…for example likes and comments.
default view shows you “Top News”. This is not The third factor is the age of the post. Over time a
necessarily a live stream of updates from your post’s relevance decays.
friends. Since the average Facebook user has 130
friends, plus any pages they’ve liked, all of those For brands, being seen on Facebook is obviously
“content creators” are competing for a spot on incredibly important. What Facebook has done
your wall (how do you like that ego boost?). with EdgeRank encourages all content creators
(Friends and Pages/Brands) to be engaging.
What “Top News” displays is the result of the Based on the criteria EdgeRank considers, some
EdgeRank algorithm which selects what Facebook suggestions to increase your edge are:
thinks you will find the most engaging, and then
delivers that edited news stream to your wall in the 1. Be engaging. Don’t oversell, but become part
Top News display. (Note: To view a live feed you of the daily conversation within the Facebook
can simply click “Most Recent” at the top of the community. Ask questions that encourage
wall next to “Top News.”) responses (comments).

So the question for anyone who wants to appear in 2. Be a media mogul. Adding photos and videos
as many Top News feeds as possible is, “How do to your posts require people to click to view. These
I get my posts placed in the top news feed?” And clicks increase your weight.
that, friends, is where EdgeRank comes in.
3. Be consistent. Since a post’s relevance
EdgeRank looks at several factors to determine declines over time, posting regular content will
what posts will show on your Top News feed. keep the conversation fresh.


ue we de

AFFINITY (ue ) WEIGHT (we ) TIME DECAY (de )

If you spend more time Weight is essentially the level Over time a post’s relevance
talking with certain friends on of interaction a piece of content decays, thus making it less
Facebook by posting to their gets. (for example likes and important and pushing it down
wall, your affinity with those comments). the feed.
friends will be stronger.


CONTENT DRIVES
FACEBOOK COMMERCE

W e hear you. “We sell merchandise. We
aren’t in the content business!”
This means you have to post consistently without
being the annoying brand fans hide from their
streams. Post enough to stay top-of-mind with
These days, though, everyone is in the content your fans, don’t let them forget you’re there, but
business. If you have a presence on the web, remember that you are only a small part of why
you are creating content. Your website copy, your fans are on Facebook.
your blog posts, and your Facebook Fan Page
updates are all forms of content. Be Authentic
Each brand has its own voice. If you’ve found
As a brand, what’s your ultimate goal in creating yours, congratulations! Use that voice to guide
this content? To drive sales, of course. But we your content strategy on Facebook and beyond.
all know that you can’t just create blog posts or Before posting, think about why your fans follow
status updates hawking only your products and you. What are you trying to accomplish with this
expect quality leads. Your content needs to be update? What update would resonate with your
interesting, engaging, and keep your audience fans? Allow the answers to these questions, your
wanting more. fans, and your brand voice to guide you.

Even then, the content you create on Facebook Be Fun
is a little different from the copy on your website Seriously, don’t over think this one. There are too
or those long blog posts. How can you use many other things to worry about when it comes
content on Facebook to your advantage when it to your brand. Just have fun with it. Updates can
comes to driving sales? be in the form of photo caption contests, polls,
behind-the-scenes videos of your operations,
Be Regular anything that gets your fans involved and lets
As you know, when it comes to your Facebook them see what you’re all about.
Fan Page, your content needs to live in the
News Feed. The Facebook News Feed moves Follow these three “rules” and your fans will be
fast and, like a new car driving off the lot, engaged with your content. When the time is right,
your update begins losing its value almost this will allow you to sprinkle in targeted offers to
immediately. We have found that posts are your loyal fan base. And since they are actively
relevant for up to 60 minutes. After that, it’s following your consistent, authentic updates, they
pretty much run its course. will be ready to jump at the opportunity.


SOCIAL MEDIA LISTENING
ON FACEBOOK


It’s easymedia strategy andinfocus on
social
to get caught up your

executing killer content, dreaming up
community and you just start dropping in stores
trying to game them for transactions, you’re
brand is kind of a jerk.
engagement plans that would make
Listening is Step One
Nine Inch Nails swoon, and debating At Moontoast, we empower brands to extend
about the perfect time to send out a their e-Commerce reach into the social stream.
Facebook post. In fact, these days it’s Transactions are very important. We understand
too easy. Let’s face it, social networks the bottom line. But we also have the obligation to
move at the speed of now. It’s no advise our clients how best to weave commerce
wonder that at 6pm on a Friday you into the social stream. We want brands to win at
feel like you’re running to stand still. social. We want brand authenticity to trickle down
from the top. And so we want brands to listen
to what their communities are saying, good and
So take a breath for a minute. Relax. Do you hear bad, and then show the community that you hear
that? That’s the sound of hundreds of millions them.
of people buzzing away about a vast array
of subjects on one of the neatest technology Listening means you have a chance to give
platforms of our time. And it presents brands with people what they want from your brand, be
an unequaled opportunity to listen. it a product or an experience. You have an
opportunity to ask questions and receive real
By this point, many brands get this…and many (free) feedback by people who have publicly told
don’t. Facebook (and other social networks) has the world they like you. Listening also means you
personalized what was, for the past 20 years have a chance to very quickly correct or make
or so, a commerce landscape dominated by right on an issue that your community might be
companies who didn’t have to be personable. complaining about.
Online commerce started out the same way.
Then through comments, and especially now Until you open this relationship as a two-way
through social networks like Facebook and street, your community probably isn’t ready for
Twitter, a bad buying experience or a customer commerce.
support issue gone bad can spread like wildfire
through social media. So can great experiences. Perfect is Boring
Perhaps no one articulates this better than our It’s tempting to want things to be perfect before
friend Gary Vaynerchuck in his book The Thank letting the world see it. The painter Paul Gardner
You Economy (highly recommended). said, “A painting is never finished, it just stops
at an interesting place.” Social campaigns are
Now that word-of-mouth can spread virally, similar. As soon as a social media campaign
brands have a fantastic opportunity to engage is live, you have already lost control. Your fans
with people on a scale that we’ve never seen will mold a campaign into the most interesting
before. Why does this matter to eCommerce? shapes you can imagine. Social media managers
Because if you don’t have a dialog with your can do their best to lead the campaign to its


destination, and when you get to that destination, When commerce is introduced to a trusting
odds are that the people in your community have community, it can be a win-win. People come to
surprised you. People are smart. They love to be expect great or exclusive offers as rewards for
a part of something big. showing their affinity to a brand. Brands deepen
their relationship with people, increase customer
A great social media campaign starts with acquisition, and add to the bottom line, to boot.
understanding a community…their wants…their
complaints…their triggers…those are things Listen to what your community likes (or doesn’t
that help shape the most effective social media like) from your commerce offerings. Use the built-in
campaigns. And that starts with listening. tools on Facebook such as comments, likes, and
surveys. Can you offer better products or greater
Listening also carries through the entire discounts? Can you improve the message in the
campaign. Once you throw a campaign out into notification a customer receives? All throughout
the world, someone might find a flaw or it might the engagement and checkout process there is
not go the way you hoped. That’s okay. Perfect is opportunity. So listen. People are smart. Learn
boring. Unexpected turns give you an opportunity what your community wants. Teach them you can
to show the community you’re listening. be trusted because you are listening.

Commerce with Ears
We learn with each campaign. We get ideas for
the next one. We respond to issues. We grow.


Fan brands guide to Facebook commerce

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