Thinking about Brands and Leads… Again

The term brands is in and of itself a tricky word, as the definition of a brand is fairly ambiguous and broad. Companies large and small are brands, from Apple (can you believe Steve Jobs is stepping down as CEO?) to BeeBeverly Hills who became known for building a company off of 100,000 Facebook likes. In the performance marketers case, a brand is a company that has every reason to spend money to acquire hand raisers instead of just buying impressions. That includes both service based companies and product based companies. Amazon is a product based company and a brand. They only spend on a performance basis. Others are somewhere in between, such as Home Depot, who has an affiliate program for their ecommerce business but a much larger brand budget for television.

Why some of these brands spend so little, or not at all, in a more performance oriented world took center stage today at LeadsCon. The key focus of the conversation revolved around the role of lead generation in a world of likes. As we’ve said before, in the past six months, a new form of CPL has taken center stage – that of Cost Per Like. Not only do some “likes” cost more than leads, upwards of ten dollars, but this CPL budget has bypassed typical CPL providers. The question on many performance guys’ minds (given that they are often contracted to get the actual likes) is “why?”. Having listened to some experts who sell to brands, here is what we learned. It explains the disconnect between brands and performance marketers and why they like social.

• Large brands think about metrics that performance marketers don’t. Performance marketers don’t think in terms of reach and awareness. Ask them their awareness score, and you won’t get deer in the headlights looks, you will get what the hell are you talking about looks.

• Brands are happy starting with a promotional relationship as long as there is a chance to turn it into a referral one. Brands don’t mind a discount or incentive so long as a story exists as to how that person will become a longer term customer. They won’t take incentive leads and will rarely take incentivized sales, but if it is a soft incentive that sounds like it could turn into a long-term customer, they will spend money on it, e.g., a like.

• Like is an interesting metric. What does it really mean? It’s social, and it’s hot, but it’s still ambiguous. A users may see a story in their news feed from a company they like, and even better for Facebook that company can spend money to run ads to those that like them, but no one really knows just what a “like” is.

• Like is not a relationship. People may not know what a like is, but it’s clear what it isn’t. I can get you to give me a high five on the street about as easily as I can get you to click a like button. Brands know it isn’t a relationship but they continue to spend as though it is.

• Like is an ego trip for brands. They may not be leads, and they are not relationships, but likes are trackable and public. Brands know where they stand with respect to other brands. No lead buyer ever worries if they buy more leads, but make it a public stat, and game dynamics take over. Now people spend not because they want to but because they want to beat their competitor.

• Like is an expensive cookie. If you like something, you can target against it. The issue, though, is that Facebook controls all the likes and all the cookies. They don’t want to make it easy for a brand to buy the likes of its competitors. They want the brand to spend money to reach its own fans. It’s a brilliant move. They buy ads to buy the likes, and then they buy ads to remarket to the people because the news feed doesn’t work quite well enough.

• Large CPGs don’t sell directly to consumers, so like is a great proxy to influence sales. If you are a soap maker, you sell through big stores. You don’t sell online directly. As a result, you have no reason to buy leads. You won’t be sending them to the local retailer. Instead, you buy TV hoping people go to their local retailer. Likes give them a way to feel in control but also feel as though they don’t interrupt their current channels. You might like the product but still buy through a channel partner.

• Likes are all about the referral. Brands spend so much on likes not to get into the news feed but in hopes of the all elusive referral. They want others to promote the brands. They feel that if they buy a like, there is always a chance – a built in chance – that one like could yield more than one relationship.

• Quality vs Quantity. Today, quantity wins. Ego wins. Quality will win, but no one really knows what quality with Facebook likes actually means. This, more than anything, encourages us but scares us. Now more than ever a like sounds like a click from 1999. People bought clicks to build up value because of this new measurement. Later they realized that the quantity of these units was not enough and that they had to yield more. Will that be the future of likes?