350,000,000 active users
30% of active users are in the United States, thats 105M users
305,000,000 is the population of the US
so 34% of the US population is on FB
77% of business’ “fan” pages have less than 1,000 fans
That means that if you are a small business in Milwaukee, you have a potential client base of about 1 million people. 34% of those people are on Facebook, bringing the number of local clients that are on Facebook to 340,000. According to checkfacebook.com, about 11% of FB users are under the age of 18, so we’ll take them out because they probably don’t have any money.
That brings the number down to 302,000 possible users in Milwaukee that could possibly become your fan. But 77% of fan pages have less than a 1,000 fans. If you’re in that 77%, you’ve only captured .3% of the possible Facebook users in your area. If you compare those 1,000 fans to the total population of Milwaukee, you’re only connecting with .1% of the potential customers.
Keep in mind, this is assuming that you have a product or service that is sell-able to literally everybody over 18…if you have a service that has a specific target market (1000 clients), 34% of them are on Facebook (340). Then, how many of the people that follow your updates are people who will actually someday be spending money with you business, as opposed to other friends in the industry, competitors, spammers, family, or employees?
So when you ad up the amount of time and money invested in your Facebook Fan Page, is it commensurate with perhaps only reaching .1% of your potential market? How many paying customers actually come from you Facebook Fan Page, especially if you’re one of the unfortunate people who are in the 77%?
Another point of consideration is that it takes roughly the same amount of time, labor, and commitment to manage a Facebook page whether you have 543 fans (George Webbs, one of my favorites) or 46,366 (Culvers, another personal fave). If you assume every hour of work that is put in to maintain the page for both restaurants costs the same amount, about $25, you’ll see…
George Webbs: $.046 per client per hour
Culvers: $.0005 per client per hour
That $25 instead could have generated probably about 20 clicks to your website using any SEM campaign. If you’re Culvers, you would need to have .o4% of your Facebook Fans click through from your page to get 20 clicks, which is about the average for any banner ad. If you’re George Webbs, you’d need to get a full 3% in order to get 20 people to your site! You can see how it becomes difficult to justify spending the time with such a small user base.
If you are a small business, or are having trouble spreading the word about your Facebook page, don’t worry! You’re not missing out on a huge opportunity, in fact you should do everything in your power to minimize the time (and money) you spend on your page until you implement a unique and appealing strategy. Unless you’re generating consistent fresh content and adding new users, your hard work should be spent on other activities…like cold calls or emails!
Sadly, Facebook seems to be cost prohibitive until you get to a point where you have enough fans to generate actual sales… the more time you spend in the initial phase, the more expensive it is per potential client. For most small and local businesses, Facebook is closer to having a listing in the Yellow Pages – you better be there when people are looking for you!