1. How FMCG companies should run their facebook brandpages effectively Florian Michahelles ETH Zürich Dallas, March 18, 2013

2. © ETH / HSG Florian Michahelles March 2013 Slide 2 / 17 2 Facebook is the largest SN and provides several opportunities for engagement with the customers...

3. © ETH / HSG Florian Michahelles March 2013 Slide 3 / 17 Despite the popularity, social media marketing has not yet reached the high expectations set... Problem: Lack of understanding of the communication medium Lack of established strategies Lack of methods for effectiveness evaluation Stelzner MA (2012) 2012 Social Media Markebng lndustry Report

4. © ETH / HSG Florian Michahelles March 2013 Slide 4 / 17 How to increase the level of customer engagement? Post Type: Photo Posting Time WHEN?WHAT? Topic* Moderator Like Comment Share

5. © ETH / HSG Florian Michahelles March 2013 Slide 5 / 17 Method: Data Collection  Java application based on Facebook Graph API  Daily data collection  January 2012 – March 2012  100 Facebook brand pages:  Food/Beverages Category  English language  posts from moderator Request: https://graph.facebook.com/ID Response:

6. © ETH / HSG Florian Michahelles March 2013 Slide 6 / 17 Method: Operationalization of the Variables  Brand Engagement:  Loyalty: number of returning fans (posted more that once)  Word-of-mouth: “People Talking About This Rate”  Community Growth:  Vividness & Interactivity: post media type (status, photo, video, link)  Page Interactivity: communication policy (posting or commenting only)  Frequency: rounded value of average number of posts per day  Weekday: weekend vs. workday  Community size: average value of fans  Content categorization: coding development strategy ( Glaser and Strauss 1967 ) Dependent Independent

7. © ETH / HSG Florian Michahelles March 2013 Slide 7 / 17 Model Estimation Results for Engagement (H1 – H5) 7

8. © ETH / HSG Florian Michahelles March 2013 Slide 8 / 17 Summary of the estimation results: supported and non-supported hypotheses...

9. © ETH / HSG Florian Michahelles March 2013 Slide 9 / 17 Managerial Implications (1/2) Content Increase reach and engagement of users by entertaining content. Non-interactive content (i.e. photos and status updates) increases the total level of engagement. Vivid content (i.e. videos, photos and links ) increases the volume of WOM communication by stimulating the sharing activity of the fans. Post shorter content in order to increase the total level of engagement. Timing Post on workdays in order to increase the number of comments. Post up to once per day in order to receive the highest level of engagement. more than once per day would decrease the total level of engagement. more than twice per day will significantly decrease the number of comments.

10. © ETH / HSG Florian Michahelles March 2013 Slide 10 / 17 Managerial Implications (2/2) Communication Policy: Create highly interactive Facebook brand pages to increase the WOM volume through fan posts. Highly interactive Facebook brand pages receive more comments. Focus: Rather focus on brand as a whole than on a single product, in order to increase the level of engagement. Engagement as Factor: Higher level of engagement increases the number of loyal users, the volume of WOM communication and ultimately, the number of fans. Increased level of engagement yields higher percentage of positive user posts. Community Size as Factor: Encourage interactions between the fans as the community grows.

11. © ETH / HSG Florian Michahelles March 2013 Slide 11 / 17 Limitations and Future Work Limitations: Selection of Facebook as a platform Selection of Food/Beverages brand page category Future Work: Explore external factors: including elements of offline marketing campaigns Expand to other brand page categories Expand to other social media platforms, e.g. Twitter Experiment: apply the model and measure effects

12. © ETH / HSG Florian Michahelles March 2013 Slide 12 / 17 How FMCG companies should run their facebook brandpages effectively Credits to: Dr. Irena Pletikosa Dissertation: Evaluation Framework for Social Media Brand Presence December 2012 http://florian-michahelles.blogspot.com http//www.im.ethz.ch/people/fmichahelles fmichahelles@ethz.ch +41 (44) 632 7477 Florian Michahelles ETH Zurich Thank you very much!

13. © ETH / HSG Florian Michahelles March 2013 Slide 13 / 17 Spearman Correlation Coefficients Matrix (H7 – H10) Growth Rate Communi ty Size Engagem ent Rate (per moderato r post) Engagem ent Rate (per fan post) Fan Posts (per user) Returning Fans (%) Talking About Rate Positive Fan Posts (%) Negative Fan Posts (%) Neutral Fan Posts (%) Growth Rate1.000 Community Size0.0031.000 Engagement Rate (per moderator post)-0.078-0.291 ** 1.000 Engagement Rate (per fan post)-0.036-0.769 ** 0.297 ** 1.000 Fan Posts (per user)-0.461 ** -0.402 ** 0.313 ** 0.573 ** 1.000 Returning Fans (%)0.117-0.446 ** 0.250 * 0.577 ** 0.754 ** 1.000 Talking About Rate0.896 ** -0.1040.0740.084-0.294 ** 0.267 ** 1.000 Positive Fan Posts (%)-0.217 * -0.202 * 0.0470.336 ** 0.210 * 0.018-0.279 ** 1.000 Negative Fan Posts (%)0.030-0.0570.1510.262 ** 0.372 ** 0.396 ** 0.065-0.1081.000 Neutral Fan Posts (%)0.218 * 0.113-0.210 * -0.0030.0570.208 * 0.230 * -0.421 ** 0.0071.000 * p < 0.05, ** p < 0.01

14. © ETH / HSG Florian Michahelles March 2013 Slide 14 / 17 Content Categorization - Coding and Examples