The surprising reason why Coca-Cola is not the No. 1 brand on Facebook
Coke has an astronomical annual ad budget and marketing machine.
Being Liberal is just one guy posting content — zero ad budget.
But one of these pages has 800,000 active users. And the other has more than 900,000 active users. Which is which, and how come?
So the question is why does the No. 1 brand in the real world not have similar brand power on Facebook?
Even Pepsi has 14 million active users — 17 times bigger.
How can Mountain Dew at 8 million fans have only 26,000 active fans (one-fifth of a percent of Pepsi)?
They’re not advertising right now.
The primary metric for engagement that Facebook has chosen is PTAT (People Talking About This). It’s the number of people who have liked, commented, posted, checked-in, or otherwise generated a story on Facebook over the last 7 days.
We know it’s an ad-driven metric. When General Motors wanted to get back into Facebook ads, they asked us to estimate how much auto manufacturers were spending, so they could set benchmark. Since we don’t know the actual numbers, we looked at PTAT relative to total interactions to approximate ad spend.
Their reach is low.
You’ve likely heard the stat that 16 percent of fans see what you share. That average includes small business pages that have 100 fans. It’s easy to get 16 reach on 100 fans, especially if most are employees and family, but if you’re a consumer packaged goods brand, your true benchmark is closer to 5 percent (2 percent if you’re above 10 million fans). However, if you’re a liquor brand or TV show, you can sometimes get 10 percent.
Coke posted 204 times in the last month. Assuming an organic reach of 3 percent and most of these being global posts, then they’re generating 360 million organic impressions a month.
And assuming their content is reasonably shareable, they’re getting about 10 percent extra in viral impressions. Call that 1 million more impressions a day, which is worth about $5,000 (even though most of their traffic is in Brazil).
Our buddy at Being Liberal did half a billion organic impressions last month — 536,036,646, to be exact. Zero paid impressions.
We know that when you run ads on Facebook, your organic and viral reach gets a nice spike, too, and there’s nothing wrong with that — it’s how the game works.
On April 24, Coke hit a recent high of 1,561,594 active users on Facebook on their main page. Their all-time high was on October 7 of 2012, so they might look at what caused this and how to repeat it.
If you’re look at your brand here, your highs are usually generated when all media channels are working together — with TV as your biggest driver. Try trending your Nielsen ratings with your Facebook, Twitter, and website stats — or we can do it for you.
Low newsfeed coverage means your fans don’t see your messages, giving you the double-whammy of low engagement, too.
Most brands lost 50 percent of their impressions in September 2012, but lost only 23 percent in total interactions, since Facebook’s newsfeed algorithm is doing a great job surfacing the right content. Read more about it here from the Los Angeles Times and also here from Social Fresh.
Focusing on market share of fans, instead of engagement
Coke has 99 million fans when you include its entire portfolio of soda, juices, and other beverages.
It’s interesting that Fanta has 600,000 active users on 9 million fans. In other words, they’ve got nearly as many active users as on the flagship Coke page. What is Fanta doing differently and how can Coke make full use of their portfolio of brands?
Incidentally, Odwalla has the highest engagement rate in the Coke portfolio at 8.2 percent versus the 1.3 percent that Coke has. We’re calculating engagement rate as active user divided by fans. There are some folks who calculate engagement rate by total interactions divided by fans — certainly some merit to this.
Coke is so big that it doesn’t need to get more fans or awareness (in fact, 94 percent of the world’s population recognizes the Coca-Cola logo). Beverage industry folks talk about “share of throat” — that literally, Coke needs to get more liquid consumption to grow sales. Look at the waters, energy drinks, shakes, and all manner of drinks. Coca Cola produces more than 1,000 juice types alone. Altogether 1.7 billion servings of Coke products are consumed every day, and in 2008, Coke had a 42.8 percent market share. But what are things like now?
A comparison of some of the top brands of the industry is telling. Coke’s has the highest market share (percentage of total fans) on Facebook at 26.29 percent, but has only 5.8 percent of Pepsi’s share of voice (percentage of total People Talking About This). This goes to show that a high market share does not mean a high engagement, and that being big is no longer enough.
The private Datalogix data you get from Facebook (if you’re a major advertiser) will show you the correlation between Facebook activity and actual sales. The average is about 650 percent — that you spend a dollar and get back $6.50 in sales.
This is great news. However, be careful about correlation versus causation. Yes, fans are spending more than non-fans on your products. But your most loyal customers are the ones becoming fans. They’re not spending more BECAUSE they are fans.
Datalogix does show consumption before and after they become fans. This is better, but still confuses correlation versus causation. The only way to measure true lift is to split test– to run in test and control markets. It’s super easy to do this by uploading your email list to Facebook as custom audiences.
Passion pages bust through the algorithm
The Mormon Church has hundreds of pages — many with millions of fans — organized around “I Love My Family.”These are “bumper sticker” pages that people easily identify with. Just look at “I fucking love science,” Being Liberal, and others.
These folks get 6 times as many impressions as they do fans and have almost as many people talking about them as they have likes.
- They’re getting at least 10 percent of users who see their content to interact.
- They didn’t get hammered last September, when Facebook over-weighted negative feedback.
- They don’t sell, sell, sell, but have 4-5 fun posts per promotion post, or none at all.
- They post quality content 20-30 times a day – but the quality is more important than the quantity.
Even if you’re not a passion brand, you can still game the News Feed algorithm by running ads to your most influential users — fans or not. You can run an unpublished post to these targets, if you’re concerned about overloading your fans. Another way to increase your impressions and engagement is by creating an exciting campaign that hooks people’s emotions, like the Red Bull Stratos project. Take a look at Red Bull’s interactions on some of their Felix Baumgartner posts. From the beginning of October through May 18, their top four posts (all about Felix) have more engagement than their next 18 most popular posts combined.
Coke itself has created this kind of passion in Brazil by making cans in Brazil’s national colors. Translated, the following post says, “Have you found the new cans in Brazil’s colors? Pedro Costa has found them.” As you can see, the excitement Coke generated by appealing to the patriotic feeling of Brazil gave this post more than 5 times the interaction than their next popular post.
But all this requires that you truly understand and segment your customers. You need deep analytics (not reports) that help you tune your content across all channels (not just Facebook). You need to see what’s working for competitors so you can mimic these techniques or at least have a solid benchmark.
If any of you have any industries you’d like us to cover in more depth, just holler in the comments below!
Image courtesy of Coca-Cola’s Facebook page.