What is a Facebook friend worth to your dealership?

I have read a couple of articles about what a Facebook fan is worth to a
business and there is zero consensus. This is rightfully so in my
opinion considering every business is different so won't the value be
different? Will restaurants have the same value as dealerships? I don't
think so. I want to try to figure out a dollar amount with your help for
car dealers.

First off, I said friend not fan because I thinks friends will have a higher value. Profile pages are better for engaging
people than fan pages which is a heck of a lot more important than the
sheer number of friends.

To do this, we need two numbers. This is what i need your help with and I think each number will create its
own discussion since there are plenty of factors that apply:

1. What monetary value can you assign a single customer of your dealership?
Factors include service only customers, multiple purchase customers,
varying gross on deals, etc.

2. What percentage of FB friends will become new customers? Factors include a dealerships message on FB,
frequency of posts, engagement from community, etc.

With these two numbers, simple math will give a dollar figure. Let me here you guys
opinions of what these two numbers should be. Research is appreciated
as I have been able to find limited information.

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Comment by Rob Hagen on July 28, 2010 at 5:00pm: We have an album of FB winners on Midlands page. We give away DVD's daily. Also for the record, no one can truly claim to be an "expert". Social media is too new and we are all learning by trial an error. One of my favorite social media quotes: "Social media is not revolutionary, it just takes execution."

Comment by Rob Hagen on July 28, 2010 at 2:41pm: "I think that if they post call to action promotions, sales incentives, Free trade appraisals, enter to win T.V. - CAR etc and other like incentives to get customers to participate, while creating live leads- and an atmosphere of sales, service, parts opportunities would create a scenario of tracked results."

I respectfully disagree. The last thing in social media you want to do is sound like a car dealership. Our golden rule of social media: Pitch less, sell more. They know who they are communicating with and we have been asked by several people in the community for more information.

"As far as not having customers with in a certain mile radius, I've seen dealers ship cars across the country."

We have a client in Colorado that ships 30 to 40 cars a month out of state but they are the minority instead of the majority. I was a baseball player and believe in playing by the numbers.

"The next step would be to gather and post customers testimony who found these special promotions on facebook and then to have them post their testimony on their own facebook page, telling all their friends and family!'

We already do this. We have over 300 Dealerrater reviews and we post one a day. Very soft sell but Midlands reputation is being ingrained into the community. We also have pictures of customers with their new cars and video testimonials that we post on their blog.

Comment by Rob Hagen on July 28, 2010 at 1:29pm: The first thing we do is grow the community and get them to engage with us. This is an unnatural act for people since the idea of being friends with a car dealership is foreign. Important note on growing the community, dealerships are local businesses so it does not do them much good to have a lot of friends that live 1000 miles away and will never be customers. We focus on the local community through traditional social media platforms and research the market to find local forums and points of interest. Once we have people engaging us and talking about us, we implement other parts of the strategy. A great example is check out Midlands Honda on FB and you will see "Columbia Pet Idol". This has had tremendous success. Daily we are doing a pet of the day and we are getting tremendous reception from the community.

Comment by Rob Hagen on July 28, 2010 at 12:52pm: Yes we are Bobby. It didn't start this way this year but my partner David Johnson and I realized that dealers were walking out of our seminars excited with the information but not knowing how to implement it with their current staffing. If you consider a solid social media strategy requires someone who can write and edit blogs, create websites and blogs, grow their community, manage their reputation and so on, it is easy to see that it is tough for a dealership even in a good economy. A few months back, we created a package for dealers to do all of this for about the cost of an entry level employee and it has really taken off. Some critics say social media should only be done in house and admittedly I will say that is the ideal scenario but we compensate for that by making sure our dealers are extremely involved in the topics and then they allow us to create the content and syndicate it.

Comment by Rob Hagen on July 28, 2010 at 10:10am: "People of all walks of life use facebook and other social mediums, the dealerships need to participate in them all"

I agree with this as long as it is done correctly. many dealers are using these platforms as an extension of their offline advertising and that will actually do more harm than good.

"I don't have a number or a dollar figure to throw out there, but I don't think for the price facebook costs, any business can do without it."

Totally agree but we are all car people. I spent 17 years working in a dealership, a dealer wants some sort of ROI for it to make sense. Social media is more about good business ethics but this is still an attempt to create a ROI. That is why I need to figure out these variables.