This post is reblogged from ActiveRain
As many of our regular readers know, we started another iPod Touch sweepstakes on Aug 14. The original rule was that we draw an iPod Touch among our RealBird Facebook Page fans, once the number of fans reach 1,000. Ambitious it was, slow it became. While we have more and more fans every day, based on the current trend it would take a long time before a lucky winner can walk away with the iPod. So we decided to change the rules.
We are going to select the winner, as soon as we reach 500 fans. Currently, we are at 232, so this goal can be reached much faster. This is good for you – our favorite fan – as you do not have to wait that long and your chances of winning just doubled. It is also good for us. Even though our "fan acquisition cost" – excuse us for this term – just doubled, the main reason for this sweepstakes is to experiment with our Facebook Page and to test social media campaigns, hence keeping the campaign dynamic and the interest level high is valuable for us. In order to have a meaningful result of this experiment, we also want to know the "true cost" of a marketing campaign based on this new media.
Those of you who already are fans of us on Facebook, you are all in, the campaign is on. For those of you who just join in now, there is only one simple step to take. Visit our Facebook Page and click the "Become a Fan" button, that's all. Two seconds of work, no purchase necessary and 1 in 500 chance of winning a brand new iPhone Touch (8GB)
As I said before, helping us share this message is really, really cool, because it shortens the time required to reach the goal and the drawing, while your chance of winning remains exactly the same, 1 in 500, even if all your readers and colleagues join. You can easily reblog this post or retweet and share it with the tools at the bottom of the post.
And that leads to the analyses of this campaign – as promised:
There are 3 main online advertising categories in general:
- CPM – Cost per Impression – you pay for every impressions. Typically banner ads (display ads) fall in this category
- CPC – Cost per Click – you pay when somebody clicks on your ad and arrive to your site or whatever you designated as a destination. Google AdWords is the most well-known implementation of this.
- CPP or CPA - Cost per Performance or Cost per Action – you pay when somebody takes some sort of actions after clicking on your ad, such as registering with your service, filling in a survey form, purchasing a product on your site etc.
All 3 types are widely used and benefit advertisers in different ways. One of the challenges with these regular advertising methods is that their effectiveness only show after some time, while you are spending money on them from day one. It's true, that with advanced ad networks (like Google AdWords), you can minimize your risk by following conversion rates closely and run trial and fail campaigns and adjust them according to the results, but nevertheless, it requires a lot of follow-up, analysis, tracking and expertise to achieve the best results.
The social media campaign we are experimenting with differs in many ways.
Technically, it falls into the CPA category because we will only have cost (purchasing the iPod) when a certain action is taken by the audience (becoming a fan of our Facebook Page). The main difference is that we do not have any cost until the overall goal is reached, i.e. 500 of you fan our Facebook Page. And that is a huge difference. It is a true, zero-risk trial and fail campaign. If we never meet our goal, cost will never occur.
There are also many benefits for us as an "advertiser" using this approach:
- The action required to participate is a high value participation: We gain Facebook Fans – a more engaged audience than the one we could reach by any other means
- The Facebook platform also syndicates the actions taken by our Fans (fanning, posting on our wall, commenting on our FaceBook page) so there is a built-in viral marketing utility
- During the campaign – since fans have to remain fans until we reach the goal – we have an ongoing communication channel to the audience, so subsequent messages can be delivered in a bi-directional, personal and engaging ways
- While some Fans will disappear after the contest is over, we hope that most of them will remain and hence we successfully build a community around our services and brand.
- It is the vested interest of our contest participants to share the sweepstakes. The sooner it reaches the goal, the sooner the winner is selected. And there is no downside bacause the chance of winning is pre-set and remains the same, i.e. 1 in 500. In other words, this type of campaign is capable of mobilizing the very participants in order to jump-start viral marketing.
Now let's see the numbers:
The 8GB iPod Touch costs us $229+tax+shipping. Let's say $250 for the sake of this calculation. So our campaign cost is $250 (excluding soft costs, like time spent on executing it, human resources etc.) Our goal is 500 fans, that makes the CPA cost – fan acquisition cost – $0.50
Prior to starting this campaign, we checked how much it would cost us to promote our Facebook Page to REALTORS(R) on Facebook. Facebook's own ad network calculated us the following campaign cost. If we choose CPM ads – paying by the impression of our ad – it would cost us $0.32 (CPM) cents per thousands impression or $0.74 per click-through if we selected CPC advertising.
While the CPM cost looks smaller, than our CPA cost, keep in mind that the click-through rate will be small and out of those who clicked-through, those who actually become our fan will be even smaller. If you add all the other benefits of our campaign – fans remain fan while the contest is running, no ongoing cost, but only at the time when the goal is reached – it becomes clear that the cost of our sweepstakes based campaign is much smaller than any of the advertising methods Facebook is suggesting. Comparing to Facebook's $0.74 CPC rate is even easier. It is more expensive for a click, than ours is for an actual action. If you consider that let's say 50% of the click-through traffic will fan us, than you are actually comparing effective CPA cost of $1.48 to our $0.50. With all the additional risks associated with CPC ads (ongoing cost, guesstimate of the 50% conversion rate) it is a no-brainer to see the cost benefit of our sweepstakes-based campaign.
So how can you apply this advertising method to gain Fans for your own Real Estate Facebook Page?
If you are serious about building a community on your real estate Facebook Page, you can start a similar sweepstakes-based campaign yourself. We can not advise on the legality of a sweepstakes in your area, so once you have the concept figured our, consult with an attorney on your own, but below are a few tips on how to make it as effective as possible.
- Pick a reasonable goal: How many fans do you want to gain? Be reasonable. We reduced our goal to 500 to keep the contest interesting and realistic. It is important to make a goal, which is high value for you, but not unrealistic for your audience.
- Select a good prize: This is exciting and important. You want to pick one which has high appeal, fits into your overall profile, business and message and ideally has incremental value for you.
- For example, if you will give away an iPod Touch you can also engrave it with your name and website, online, while checking out in the Apple Store. So besides the core goal of the campaign (gaining Fans) you also gain incremental benefit, the lucky winner will be always reminded of you and where the gift came from.
- Another good prize for real estate campaigns could be to team up with a local retailer or restaurant. You could give away a fine dinner for two sponsored by your partner restaurant. This could be a win-win for everybody. You gain followers on your real estate Facebook Page and the prize does not cost you a penny, the restaurant, retailer gains a very low cost advertising (compare the $60+- the dinner will cost them to how much it would cost them to place an ad in a local newspaper) and your winner gets a great prize. It's up to you whether you pay for the prize or you make the partner pay for it, but I believe that there are many verticals (restaurant, retailers etc.) who would find this a very cost effective social media marketing tool for themselves as well and would be glad to pick up the bill for you.
- Share, share, share: Just like with our campaign, it is very important to share the contest as much as you can. Tweet about once a week, write follow up blogs, ask your partners to write about it as well and most importantly, ask your readers and Fans to share it as well. They don't "harm" their luck, and by sharing it incrementally, everybody gains.
- Analyze, adjust and repeat: It is important to track your campaign during the process and adjust your goals as needed. Once it is concluded, do the simple math, calculate and try to quantify the results. Make sure that you announce the winner, and if the overall result is good (net positive), start a new campaign ASAP. For example, once we reached our goal of 500 fans, and upon our final analysis, we will start a new one with the goal of 100 fans. We will also try to find a partner who will provide the prize themselves in order to experiment with that approach as well.
I hope you found this post useful and if you decide to start your own social media campaign on Facebook, we would love to hear about it.
If you are not yet a Fan of our RealBird Facebook Page, please click here and become a fan. You will be instantly entered in our iPod Touch sweepstakes and will have a 1 in 500 chance of winning the prize.
Finally, please share, share, share this post. Remember, no matter how much you share the contest, it will not reduce your chance of winning.