Status: In a Relationship
How Effective is Customer Relationship
Marketing on Facebook?
The Honors Program
Senior Capstone Project
Student’s Name: Courtney Weiss
Faculty Advisor: Dr. Elaine Notarantonio
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Table of Contents
Abstract ......................................................................................................................................1
Introduction ................................................................................................................................2
Literature Review.......................................................................................................................4
Users ....................................................................................................................................4
Facebook Advertisements .....................................................................................................4
Facebook Pages ....................................................................................................................5
Effectiveness of Promotion on Facebook .............................................................................6
Customer Relationship Marketing ........................................................................................8
Yasar University Study .........................................................................................................9
Narrative of Methodology........................................................................................................11
Results .....................................................................................................................................13
General Facebook Usage ....................................................................................................13
Facebook Advertisements ...................................................................................................14
Company Facebook Pages ..................................................................................................16
Facebook and the Entertainment Industry ..........................................................................18
Other Forms of Engagement ...............................................................................................20
Conclusion ...............................................................................................................................22
Limitations ...............................................................................................................................24
Future Research .......................................................................................................................24
Appendicies..............................................................................................................................26
Appendix A – The Facebook Sales Funnel.........................................................................26
Appendix B - Linkages Between Marketing, Customer Service and Quality ....................27
Appendix C - Focus Group Guide ......................................................................................28
Appendix D - Survey ..........................................................................................................30
Appendix E – Attitudes toward Company Facebook Pages ...............................................38
Appendix F – Attitudes toward Entertainment Pages on Facebook ...................................39
References ................................................................................................................................40
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ABSTRACT
Facebook provides an avenue for companies to connect with consumers in new ways. Since so
many tools for communication are available on the site, it can be difficult for a company to focus
its marketing efforts. This study examines how consumers respond to Facebook Advertisements
and company pages on Facebook in order to determine where companies should allocate their
resources on the social networking site. Specifically, it explores consumer click-through rates on
Facebook Ads, as well as consumer perception of various Facebook promotional tools. The
methodology includes traditional research in the form of a literature review, as well as focus
groups and surveys of Bryant University students. Ultimately, the findings show that Facebook is
an effective medium for conducting Customer Relationship Marketing, as consumers respond
much more positively to company Facebook Pages than to Facebook Ads. The results of this
project will assist companies in their use of Facebook as a promotional tool for Customer
Relationship Marketing by providing insights on how these tools are perceived by college
students.
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INTRODUCTION
Social Networking is fast becoming a main vehicle for communication. Online social networks
are used for everything from keeping in touch with friends and posting pictures, to organizing
and communicating with professional contacts. College students in particular are caught up in the
social media epidemic. Specifically, Facebook was ranked as “the only social network that really
matters” in 2009 (Anderson Analytics, pg 1). The site even surpassed Google as the most
popular website with this demographic. Though sites like Twitter have grown in popularity in
these three years, Facebook remains the premier social networking site (SNS). Students visit
Facebook on a daily basis for a variety of reasons, including communicating with friends,
playing games, viewing friends’ pictures and so on.
Even further than that, it has become a platform to rapidly spread word-of-mouth. For example,
a recently proposed ban of all “bully breeds” - Doberman Pinchers, Rottweilers, Chow Chows,
German Shepherds, Great Danes, Pit bulls Mastiffs, Akitas and Huskies - in North Carolina was
posted as a link shared on Bryant University Mascot Tupper’s Facebook page (Marabito, 2011).
Later that day, the same link was shared on the page of author, Jen Lancaster. Not only had 305
people liked her post and 218 users commented on it, 339 users shared the link with their friends
(Lancaster). Even if each of these users only had 100 Facebook friends, the message would be
exposed to 33,900 additional individuals. This is just one example of the incredible reach of
Facebook. The implications of this reach show great potential for the spread of promotional
messages on Facebook.
Given the rapid transfer of information from consumer to consumer on Facebook, marketers
have recognized an opportunity to communicate with these users through this platform.
Facebook offers a unique chance to relate to consumers on a personal level. First, users are
presented with ads that relate closely to their stated interests, information they post and
connections they have established. This strategy has the potential to excite consumers, as they
are shown advertisements that are likely to pique their interest. On the industry side, advertisers
can target consumers according to extremely specific criteria. As a result, they can avoid
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wasteful advertising spending. Furthermore, Facebook Pages allow consumers to join brand
communities on the site. Users then have a chance to post any questions, comments or concerns
on the company’s page. A representative of the firm is able to address these concerns, thus
building a personal relationship with the consumer. The firm may also post updates for all of its
fans to view.
Though these are exciting marketing opportunities, their effectiveness must be evaluated. Having
the capability to reach consumers in this way is not very valuable unless the consumers take
notice, either consciously or subconsciously. In fact, companies may stand to lose respect from
customers if their Facebook marketing is not executed properly. For example, consumers may be
frustrated with the ads on the side of their pages or excessive updates in their newsfeeds from
brands. If this is the case, companies would want to keep these kinds of promotions to a
minimum. Overall, companies will benefit from learning how consumers respond to different
marketing tactics on Facebook.
Ultimately, this study is worthwhile because its results will aid firms in their use of Facebook as
a promotional tool. Specifically, it will direct their efforts to Facebook’s most effective features.
Thus, companies will know not devote time and capital to fruitless methods. On the other hand,
they will see which tools on the SNS work. As Facebook is a relatively inexpensive platform for
marketing and advertising, the results of this study would be particularly useful to small
businesses that do not have large advertising budgets. Still, a presence on Facebook is becoming
standard, so all organizations must know how to capitalize on that presence.
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LITERATURE REVIEW
Facebook is a social networking site (SNS) that was initially created by college students, for
college students. Mark Zuckerberg launched the site in 2004, while he was a sophomore at
Harvard University. Since then, over 550 million people have created profiles, and membership
expands by 700,000 per day (Grossman, 2010). Time Magazine stresses just how far Facebook
reaches, stating, “One out of every dozen people on the planet has a Facebook account. They
speak 75 languages and collectively lavish more than 700 billion minutes on Facebook every
month,” (Grossman, 2010). Therefore, it is safe to say that Facebook has become part of the
global culture.
The social networking site allows users to generate a profile, “friend” other users, and interact
with these friends via wall posts, as well as Facebook Messages (which are comparable to e-
mail) and Facebook Chat (which is comparable to instant messaging). People naturally seek to
make connections and Facebook is the perfect venue for them. John Raacke and Jennifer Bonds-
Raake, professors at University of North Carolina-Pembroke, studied the “average” college-aged
social networking site user. They discovered that, in general, young adults are more likely to
engage in online communication than older generations. In addition, they found differences
between the genders and their activities via online communication. Women tended to use it to
“maintain personal connections with family, friends and coworkers,” (Bonds-Raacke & Raacke,
2008). However, men are more likely to uses this mode of communication for romance and
sexual interests.
Facebook Advertising offers a unique marketing opportunity to reach very specific markets or
consumers. Facebook takes the information users provide in their profiles and relays it to
companies. This data varies from demographics such as age, occupation, marital status and
geographic location, to psychographics like leisure activities, favorite bands, movies etc. User
data is obtained through the information individuals provide on their profiles, the pages they
“Like”, the groups they join and even their status updates. Firms can then advertise to only those
users who fit within their target market, rather than advertising to all of the over 500 million
people who have a Facebook page (Reach and Targeting).
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The college students Facebook originally targeted still make up a large percentage of users. In
fact, individuals ages 18-24 make up over a fourth of Facebook users. Sadly, it is not uncommon
to glance around a college classroom and see several students on Facebook. Therefore, there are
huge implications for Facebook Ads and Pages targeting college students. 57% of users are
female and 43% are male (Reach and Targeting). These broad statistics, as well as the extremely
detailed information Facebook provides to advertisers, allows them to target virtually any type of
consumer and, ideally, match consumers to the products and services they want and need. Still,
perhaps the most exciting statistic for marketers is the fact that in November of 2010 Facebook
“accounted for 1 out of every 4 American page views,” (Grossman, 2010). Therefore, companies
who advertise on Facebook have great potential for their Ad to be viewed.
In addition to the ability to reach very specific markets, Facebook also boasts the affordability of
its ads. Firms may choose between two pricing methods: Cost Per Click (CPC), which charges
the company only when users click on its advertisement, or Cost Per Thousand Impressions
(CPM), for which companies incur a fee for each thousand users who see its ad, regardless of
whether or not the views result in clicks. Facebook’s Glossary of Ad Terms states that CPC
advertisers’ goal is to gain traffic to their sites to manage the cost of gaining this traffic, while
CPM advertisers wish to control where their ads are seen and what the ads will look like (Help
Center ). Once the firm chooses a payment method, it then bids to determine the price of each
click or thousand impressions. First, Facebook provides a suggested bid range. Then, the
company will offer a maximum bid. The final price the company is charged is the amount
necessary to win their auction, which can be lower than the initial maximum bid. Furthermore,
Facebook permits advertisers to set and manage a daily budget representing the maximum
amount they wish to spend on advertising for that given day. Once this limit has been met the
company’s ads will automatically stop running (Cost and Budgeting ).
Furthermore, the social networking site offers several additional options to gain visibility and
maintain a relationship with consumers. First, companies can create Facebook Pages. These
Pages allow companies to interact with consumers the same way they would with their other
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friends, sharing information in a profile and through status updates. The cost of each fan of a
Facebook Page is about $0.50 (O'Neill, 2009b). Also, other users are able to “Like” the page,
which then shows up on this user’s profile, as well as on the Newsfeeds of his or her friends,
creating automatic word of mouth. Other tools available are Groups and Events. Though the
above mentioned tools are free and may obtain much user generated traffic, views may also be
increased by creating an ad to promote a Page, Group or Event (Ad Types ).
While Facebook is proving to be a valuable marketing resource, potential advertisers should have
realistic expectations regarding the results of their ad, as well as how to utilize Facebook
effectively. Nick O’Neill of Business Insider warns of the “10 Rules for Advertising on
Facebook.” The first and most important expectation marketers must have relates to Facebook
and direct sales; that is, advertising on Facebook is a weak link to direct sales. O’Neill explains
that Facebook ultimately serves as a tool for relationship marketing. Marketers can maintain a
relationship with consumers through Facebook much the same way that individuals use the site
for personal relationships. In this way, Facebook should not be seen as an instrument to generate
a burst of sales, but to build a brand loyal following.
Another pertinent point that O’Neill makes is that one should not over-target. Facebook allows
marketers to specifically target individuals based on 11 factors, including demographic
information, keywords that appear on their profiles, languages and connections. Therefore, it
would be wasteful for advertisers to launch a standard ad to all of Facebook, or to target based on
only one of the 11 available criteria .Ultimately, O’Neill states that, “relevance will get people to
respond to your ad,” (O'Neill, 2009a). In order to create “relevant” ads, marketers must first
segment the market and clearly define who their customers actually are. Though this seems like
an obvious point, painstakingly deriving a target market and defining each aspect that qualifies a
consumer as part of that market will pay off when creating a Facebook Advertisement.
O’Neill discusses the role Facebook plays in relationship marketing more thoroughly in his
article, “The 5 Phases of the Facebook Sales Funnel,” (O'Neill, 2009b). Much like a traditional
sales funnel, the Facebook Sales Funnel depicts awareness as the first goal of Facebook
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Advertising. Next, marketers must educate their fans by providing the answers to the following
questions: “Who are you?” “What do you sell?” “Who’s in your community?” and “Why do I
want to join?” (O'Neill, 2009b). Once fans have been educated, they must then become engaged.
Engagement on Facebook has several metrics, such as the number of “Likes” posts are receiving
or comments on page material. Following engagement, consumers must choose to take some sort
of action, whether that be clicking on an ad or actually purchasing the product. Finally, to
maintain a relationship with consumers, marketers must ensure that they repeat engagement. To
view the Facebook Sales Funnel, please see Appendix A.
Additional effort on the company’s side can ensure that consumers continue through the funnel
and become brand loyal. For instance, if users do not see a reason to fan a company’s Page, then
they may never move past education, or even awareness. Marketers must inform users of the
benefit of becoming a fan of their Pages. By posting certain information exclusively on
Facebook or offering discounts through Facebook, companies give consumers incentives to fan
their Pages. Once users become fans of the page, it is crucial to keep them engaged. Justin
Palmer of Palmer Web Marketing states that companies must “respond to every single comment”
made by their fans, particularly negative feedback. By doing so, companies demonstrate
excellent customer service and cultivate consumer relationships (Palmer, 2010).
Website consultant Rich Page praises Facebook Ads above even the search tool Google
AdWords. With Google AdWords, the advertisements that appear on the right side of the screen
will relate to what the individual is searching at the time, or topics that are stored in his or her
search history. Page argues that while what one searches for on Google may give some insight
about him or her as a consumer, it is difficult to thoroughly target consumers using Google
AdWords. However, again, Facebook Ads gives marketers the opportunity to display their ad to
only those users who fit their precise market. Additionally, Page states that Facebook
Advertising offers fewer restrictions than Google AdWords. For instance, one may use up to 135
characters in a Facebook Ad, as opposed to the 75 characters Google AdWords allows.
Furthermore, Facebook Advertising permits the use of images in the advertising which appears
on the right hand side of the screen, while Google AdWords can only display images in banners.
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Page also declares that Facebook Ads are often much more cost effective, especially for small
businesses. Finally, perhaps the most interesting point Page makes is that Facebook Ads are an
especially good choice for dating and community sites, as you can assume that users are already
interested in virtual communities and connections (Page, 2009).
This study will juxtapose students’ recall of Facebook Ads with their activity involving
companies’ Facebook pages. This will uncover whether Facebook is simply a tool to be used for
awareness or reminder ads or if it is truly a vehicle for Customer Relationship Marketing. In
order to make this judgment, one must first study traditional Customer Relationship Marketing.
Customer Relationship Marketing (CRM) is described as “the practice of using marketing
activities to establish, develop and maintain successful long-term customer relationships,”
(Customer Relationship Marketing , 2011). This process allows companies to develop their
brands while receiving sometimes instantaneous customer feedback. More specifically, it is a
tool for “delivering the right products to the right customer at the right time,” (Customer
Relationship Marketing , 2011). Timely feedback allows companies to close the “‘quality gap’
between what customers expect and what they get,” (Ballantyne, Christopher, & Payne, 1991).
The current Relationship Era in Marketing has a unique focus as compared to the previous eras:
Production, Sales and Marketing. During the Production Era, dominant in the market prior to
1925, companies based their success on their production volume. Therefore, companies stressed
production first and seeking customers was secondary. The classic example of a production
orientation is Henry Ford and his famous statement, “they can have any color they want, as long
as it’s black,” (Boone & Kurtz, 2012). The Sales Era then followed, lasting from the 1920s into
the early 1950s. During this time, companies attempted to align their production to the amount of
potential customers who would want their product. Companies finally began to focus on the
marketing concept, which is that the firm’s success is tied to identifying and solving customer
needs, during the Marketing Era. The Relationship Era, beginning in the 1990s, built on this
notion even further (Boone & Kurtz, 2012).
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Traditionally, CRM is conducted through two arenas: quality management and customer service.
In order to adhere to the marketing concept, companies have had to abandon the ‘conformance to
specifications’ view of “quality” (Ballantyne, Christopher, & Payne, 1991). Instead, companies
must determine how their customers perceive quality. CRM is a powerful tool in discovering this
perceived quality. Impeccable customer service maintains these relationships. Thus, marketing,
quality management and customer service becomes a cycle, in which each element impacts the
others. A clear diagram depicting the links between Marketing, Quality and Customer Service
can been seen in Appendix B.
Aside from building long-term relationships with customers, CRM has several important,
tangible benefits. First, it allows companies to prevent wasteful marketing activities by
identifying the only customers who are likely to respond to marketing action. Therefore, funds
are not wasted by presenting marketing messages to those who are unlikely to respond. In
addition to decreasing expenses, this practice increases profits because more individuals who
need the product, and are willing and able to purchase it, are receiving marking information.
Furthermore, by tracking when customers are using specific products companies can schedule
their marketing efforts appropriately. As a result, customers are only receiving messages at the
time when they are most receptive to them. Not only does this increase the likelihood of
purchase, it decreases the chance that customers will become annoyed with the messages.
Finally, there are the benefits of having a loyal customer base. Not only will this dedicated group
provide sustainable profits, they will be a vehicle for expand customer bases through referrals
and word of mouth (Customer Relationship Marketing , 2011).
Customer Relationship Marketing on Facebook is maintained through brand communities
established on company fan Pages. A customer joins these communities by “Liking” company
Pages. A current study performed by Dr. Yesim of Yasar University aimed to determine brand
and advertising engagement on Facebook. Dr. Yesim also sought to discover the usage factors of
Facebook. While this information is useful, it is beyond the scope of this project. Therefore, this
paper will focus on his exploration of brand advertising and engagement. He broke this
engagement down into three categories: “Brand Community Engagement,” “Brand Community
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Approach,” and “Ad attitude.” In order to measure consumer involvement in each category, Dr.
Yesim administered a pen and paper questionnaire to voluntary Facebook users aged 18 to 58,
including 199 females and 207 males (Yesim, 2010).
In order to measure brand community engagement, questions such as, “I become a fan of ads
I’ve seen on my profile,” “I become a fan of a brand community if my friends are also fans of the
same community,” and “I bought a product/service from the ads that I saw on my profile,” were
included. Questions like, “I am interested in brand announcements on my profile or wall,” “I feel
a part of the brand communities that I joined,” and “my friend’s opinions about ads and groups
are very important to me,” marked the brand community approach category. Finally, “the ads on
my profile are annoying” and “I don’t remain friends/fan of a brand if it continuously sends me
info and ads,” addressed concerns in the ad attitude section (Yesim, 2010).
The results showed that consumers are generally interested in the brand announcements on their
wall or newsfeeds. In addition, users showed that their friend’s opinions are highly important to
them and they influence the brand communities that they join. As expected, individuals tend to
ignore the ads on the side of their page and they will discontinue “friendships” with brands that
frequently send them notifications. The most intriguing statistics showed that, “users who are
more adapted to the brand community approach spend more time on Facebook,” and that, “males
are more brand community oriented than females,” (Yesim, 2010).
While the results of the Yasar University study support the hypothesis of this study, more in
depth research is necessary. Since half of the focus was on the entertainment and socialization
aspects of Facebook, there was less space on the survey for questions pertaining to brand
engagement. Also, Dr. Yesim’s study included only a pencil and paper survey. Computer
administered surveys would allow for more detailed and accurate responses, especially in regards
to recall of Facebook advertisements. In addition, focus groups will provide rich qualitative data.
Furthermore, brand engagement should be broken down into more than three categories or
classes in order for more precise measurement. Overall, this piece of research is helpful in
building a platform for a more comprehensive study.
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NARRATIVE OF METHODOLOGY
Much established research has been obtained from Facebook itself, mainly by necessity. In order
to understand and present how consumers feel about Facebook Advertisements, it is essential to
learn how one goes about advertising on the site. Facebook has an exemplary guide to aid
marketers or small business owners in establishing a Facebook Ad or Page. Additionally, the
website provides resources to help individuals manage their budget for these ads. By gaining this
background knowledge, one has a foundation to build upon. In addition to Facebook itself, many
online resources, such as tech blogs, have been helpful in the initial literature review. Also, the
studies in the current body of must be examined to support or refute the hypothesis of this
project. Finally, the HELIN catalog contains a few books that go into further detail on how to
utilize Facebook in marketing, and they are included them in the references.
In order to drill down into how college-aged consumers respond to Facebook Ads and
promotions, both a survey and focus groups were conducted. First, the focus groups were carried
out to gain qualitative insights from Bryant University students on their experiences with
companies on Facebook. Participants for these focus groups were obtained from Professor Jean
Murray’s Marketing Principles class. These students self-selected after being offered the
opportunity for extra credit. In order to structure these focus groups properly, first a focus group
guide was developed. This guide served to keep the discussion on track and to ensure meaningful
responses. However, conversation was allowed to flow naturally, as long as it was relevant.
Ultimately, the focus group guide ensured that all of the questions of the investigator were
answered. A copy of this guide can be found in Appendix C.
Significant differences in males and females were expected; thus, the focus groups were
separated by gender. As anticipated, the responses varied greatly from the males and the females.
First, men tended to notice sports related ads on the sides of their Facebook Pages, while the
women noticed many fashion ads. In addition, the men needed to be offered some sort of
incentive, no matter how small, in order for them to “Like” a company on Facebook. For
example, one young man claimed that he would be willing to “Like” a company Page if he
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received a 5% discount. While the females looked for these kinds of incentives, they were more
willing to “Like” their favorite brands without any sort of prompt.
The largest difference between the male and the female groups was their attitudes towards ads on
Facebook. Though the women did not frequently click on the ads that appeared on the side of
their pages, they would occasionally click on clothing or shoe ads. Responses showed that they
generally did so when they were bored or in the mood to shop online. However, the men would
not click on the ads that appeared on their pages whatsoever. Even if the ad caught their eyes,
they would not click-through because they feared that it would be a virus. Rather, if they were
interested in the brand or item, they would perform a Google search on the product or brand in
question to gain more information. The overall response from the men was that Facebook Ads
were not seen as credible.
Still, the men and women had several important similarities. First, they tended to go on Facebook
for the same reasons: to talk to friends (especially friends from high school), to investigate the
pages of other users, and to see friends’ pictures. In general, students would log on four to five
times per day and they would actively stay on the site for about five to ten minutes at a time.
However, they often would keep a tab open to Facebook during their entire internet use, even if
they were not looking at it the whole time. Additionally, members of both groups could recall
specific companies that they had “Liked” on the site. For instance, one female followed
Victoria’s Secret and one male “Liked” Nike. Finally, all participants recalled seeing ads for
specific product categories on Facebook, such as engagement rings, sporting gear, clothing and
shoes.
Using the feedback from these focus groups, a survey was constructed. This survey was
administered to a different group of Bryant students. Quantitative data was drawn from the
survey regarding the number of Ads users regularly click on, the number of pages which they
have “Liked”, whether or not they view these tools as helpful, if they have received any benefits,
such as a discount, by becoming a fan of a company’s page, and so on. In response to the focus
group feedback, questions regarding the trustworthiness of Facebook Ads were included.
Furthermore, the survey posed questions about incentives provided for “Liking” companies.
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Finally, questions specific to the entertainment industry were added due to the interests found in
the focus groups. A copy of the survey can be found in Appendix D. Ideally, a random sample of
Facebook users would have been best to represent the true population; however, such a sample
was not possible due to limitations of communication and availability. Thus, students self-
selected into the sample via their participation in the Bryant University behavioral lab.
Attendance of two, one hour long sessions is mandatory for all Marketing 201 students, most
whom are sophomores.
RESULTS
General Facebook Usage
The survey was administered during the week of April 2, 2012 in a proctored computer lab.
Ultimately, 275 students started the survey, with a 93.09% completion rate. Only the 256
completed responses are configured in the results. First, 90.68% of participants indicated that
they had Facebook accounts. This statistic holds great implications for the ability of Facebook
marketing tools to reach college students. Furthermore, the majority of individuals (53.85%) log
onto the SNS multiple times per day. Combined, 87.85% of individuals go on Facebook at least
once per day. Still, most students claimed that they only actively stayed on the site for five to
fifteen minutes per log-in. While on Facebook, participants looked at other people’s profiles and
pictures, communicated with friends, posted statuses and pictures and posted links. Results for
general Facebook usage questions can be found below in Tables 1, 2 and 3.
Table 1: How often do you log on to Facebook?
Answer Count Percent
Once a week 10 4.05%
2-6 times per week 20 8.10%
Daily 36 14.57%
Multiple times per day 133 53.85%
Leave a Facebook tab open while
online
48 19.43%
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Table 2: How long do you actively stay on Facebook during a typical visit?
Answer Count Percent
Less than five minutes 50 20.41%
5-15 minutes 125 51.02%
16-30 minutes 54 22.04%
31-60 minutes 10 4.08%
More than an hour 6 2.45%
Table 3: What types of things do you do while on Facebook? Check all that apply
Answer Count Percent
Post Pictures 113 13.85%
Post Statuses 119 14.58%
Communicate with friends 202 24.75%
Post Links 113 13.85%
Look at other people’s
profiles/pictures
213 26.1%
Play games 36 4.41%
Other 20 2.45%
Facebook Advertisements
The next section of the survey focused on Facebook Ads. First, students were asked whether or
not they noticed ads on the site: 80.57% replied that they did notice ads. Of these individuals, the
majority – 73.99% - claimed to see ads on the side of the Facebook page. Furthermore, most –
62.35% - admitted that the ads they see align with their interests. Therefore, one can determine
that these ads are reaching their intended audience.
Still, students generally do not click on these ads. In the past month, 83.74% of students
surveyed did not click on any Facebook Ads. In fact, of those who had clicked on an ad, only
11.9% claimed to do so once per week. Combined with those who click once per month, the
percentage only increases to 21.42%. Surprisingly, 35.71% stated that they have only clicked on
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Facebook Ads once or twice, in total. In addition, in keeping with the male focus group
responses, 51.71% of respondents either disagreed or strongly disagreed to the statement, “I trust
the ads I see on Facebook enough to click on them.” Even worse, a combined 41.64% of
individuals believed that Facebook Ads would give their computers viruses. Finally, only
14.17% of respondents stated that they actively read any ads on the site. Thus, from these results,
these ads have little use in driving traffic to a company’s site. Still, it seems that if any company
were to benefit from Facebook Ads, it would be one with a well established brand. The majority
– 32.10% - of students who had clicked on ads did so because they recognized the brand or logo.
Table 4: Attitudes towards Facebook Advertisements
Question Strongly
Agree
Agree Neither Agree
Nor Disagree
Disagree Strongly
Disagree
I trust the Ads
I see on
Facebook
enough to click
on them
5.13%
17.52%
25.64%
25.64%
26.07%
I believe the
ads on
Facebook will
give my
computer
viruses
12.88%
28.76%
30.47%
19.74%
8.15%
Companies that
advertise on
Facebook are
reputable
3.86%
25.32%
57.08%
10.30%
3.43%
Clicking on a
Facebook ad
will lead me to
the company’s
website
6.87%
34.33%
39.48%
16.74%
2.58%
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Company Facebook Pages
While responses regarding Facebook Ads were highly negative, feedback on company pages on
Facebook was much more positive. The majority of students – 64.85% - claimed to have “Liked”
a company on Facebook in the past month. Of these individuals, 57.33% “Liked” one or two
companies and 34.67% “Liked” three or four. Furthermore, 86.34% of individuals have seen
print or television ads prompting them to find the company on Facebook. Of these students,
37.55% have then searched for the company on the SNS.
In terms of reasons for “Liking” company Pages, students displayed a great discrepancy between
those companies they have “Liked” in the past, and companies that will implore them to “Like”
them in the future. When asked what prompted them to “Like” companies in the past month, the
majority of respondents – 54.85% - stated that they loved these brands. Another 16.02% claimed
that they wanted to find out more information on these companies’ products or services. Only
12.14% “Liked” these companies because they were offered a discount. Comparatively, when
asked what a company would have to do to get them to “Like” its Facebook page, 47.58% of
participants stated that the company would have to offer a discount. Only 30.4% claimed that
offering products and services that they used frequently would suffice. Thus, there is a large
disparity between what students say they will do in the future and what they have actually done
in the past.
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Further attitudes toward company pages were measured with Likert scales. Students were asked
to state how they feel about a variety of statements regarding Facebook Pages: Strongly
Disagree, Disagree, Neither Agree nor Disagree, Agree, or Strongly Agree. When presented with
the statement, “I think companies must be on Facebook to keep up with their competition,”
52.84% agreed and another 18.78% strongly agreed. In fact, only 11.35% disagreed or strongly
disagreed – the remainder being neutral. Moreover, a total of 64.35% respondents agreed or
strongly agreed to the statement the, “even if I do not “Like” a company, I think they should be
on Facebook.” Over three quarters of the students surveyed believed that being on Facebook
allows companies to inform their followers faster. While the majority of respondents indicated
neutrality, more agreed than disagreed to the statement, “I feel more connected to companies that
I’ve “Liked” on Facebook.” Neutrality was also favored for the questions, “I find updates from
companies I’ve “Liked” in my Newsfeed to be annoying,” and, “I’ve learned useful information
from updates from companies in my newsfeed.” Still, in both cases, more respondents agreed or
strongly agreed than disagreed or strongly disagreed. Figure 1 below summarizes the results
from this section of the survey.
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Figure 1: Attitudes towards Company Facebook Pages (See Appendix E for Details)
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
Strongly
Disagree
Disagree Neither
Agree
Nor
Disagree
Agree Strongly
Agree
Ithinkcompaniesmust
beonFacebookto
keepupwiththeir
competition
EvenifIdonot
"Like"acompany,Ithink
theyshouldbeonFacebook
BeingonFacebook
allowscompaniestoinform
followersfaster
Ifeelmoreconnectedto
companies
thatI've"Liked"onFacebook
Facebook and the Entertainment Industry
Responses from the focus groups indicated that students are more eager to “Like” pages for
musical artists, movies and television shows. Thus, a section of the survey was devoted to the
entertainment industry. Students were asked, in three separate questions, whether they had
“Liked” a movie, television show or a musical artist/band. While for all three questions, the
majority of students responded “No,” the results were very close. Still, these statistics were
surprising when compared to the percentage of students who had “Liked” a company in the past
month. It was expected that more individuals would like movies, television shows and musical
artists than would “Like” company pages. However, the results showed just the opposite. When
averaged together, 101 students indicated “Liking” a page from the entertainment industry.
Comparatively, 156 respondents claimed to have liked a company. Furthermore, the majority –
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63.31% - of participants either agreed or strongly agreed to the statement, “I am more likely to
“Like” a movie, TV show, or musical artist on Facebook than I am to “Like” a business.
Therefore, there is a disconnect between students’ actual behavior and their theoretical behavior.
Still, the entertainment industry has a strong presence on the SNS, and students react positively
to this relationship. During the focus groups, students stated that following musical artists was
especially beneficial as a fan. Thus, this notion was translated into questions on the survey. First,
participants were asked to rate their level of agreeableness to the statement, “Following a
musical artist on Facebook makes me feel more connected to him/her.” More students chose
“agree” than any other category. Furthermore, a total of 63.27% of participants indicated that
they had learned information about a musical artist by following him/her on Facebook that they
would not have discovered otherwise.
Table 5: General Entertainment Industry Responses
Question Yes No
In the past month, have you ever
“Liked” a movie on Facebook?
35.71%
64.29%
In the past month, have you
“Liked” a TV show on
Facebook?
43.28%
56.72%
In the past month, have you
“:Liked” a band or musical artist
on Facebook?
48.95%
51.05%
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Figure 2: Attitudes towards the Entertainment Industry on Facebook (See Table in
Appendix F for details)
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
40.00%
45.00%
50.00%
Strongly
Agree
Agree Neither
AgreeNor
Disagree
Disagree Strongly
Disagree
Followingamusicalartiston
Facebookmakesmefeelmore
connectedtohim/her
Followingamusicalartiston
Facebookhasallowedmetolearn
informationImaynothaveheard
withoutfollowinghim/her
Iammorelikelyto“Like”amovie,
TVshowormusicalartiston
FacebookthanIamto“Like”a
business
Other Forms of Engagement
Facebook offers several other forms of engagement for consumers to show support for
businesses. First, the site allows users to “check-in” at different locations, including places of
business, similar to Foursquare. This feature alerts the user’s friends that he is at the selected
location via a notification on their newsfeeds. While most participants had not checked in at a
place of business in the past month, a respectable 42 individuals, or 20.09% of the sample, had.
Of these participants who had used the “check-in” option, over half did so in order to show their
support for the business. This trend suggests that this is a useful tool for engaging consumers. In
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addition, to some extent, it can be used to drive traffic to a business, as 14.89% of respondents
claimed that they “checked in” in order to receive a discount or special offer.
Finally, Facebook has great potential for the spread of word-of-mouth. Users can post links on
their own walls or those of their friend to products they want or commercials they enjoyed. As
this activity was discovered to be common in the focus groups, especially with the female group,
questions on the topic were included in the survey. Again, the majority of respondents did not
share information about products or services with their friends on Facebook in the past month.
However, the results were still significant: 31.62% had shared such information. Of these
individuals, posting links was the most popular method of sharing, as 43.04% posted links on
their friends’ walls and another 36.71% posted links as their statuses.
Table 6: In the past month, have you shared information
about products or services with your friends on Facebook?
Yes No
31.62% 68.38%
Table 7: If yes, how did you do so?
Posted a link
to a webpage
in your status
Posted a link
to a webpage
on a friend’s
wall
Sent a link to
a webpage to
a friend in
Facebook
Chat
Posted a video
or commercial
in your status
Posted a video
or commercial
on a friend’s
wall
Sent a video
or commercial
to a friend in
Facebook
Chat
36.71% 43.04% 6.33% 7.59% 2.53% 3.80%
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CONCLUSION
Several key conclusions can be drawn from the results of this study regarding the effectiveness
of CRM on Facebook. First, it is clear that students have much more positive attitudes about
company Facebook Pages than they do about Facebook Ads. Responses from both the survey
and the focus group indicated that students do not trust Facebook Advertisements, as they
believe they will give their computers viruses. That is not to say that they do not notice these ads,
the majority of respondents could recall seeing these ads. They also indicated that these ads were
aligned to their personal interest. From this information, one can infer that Facebook Ads may be
used to generate awareness, but they are poor for directing traffic to the source of the
advertisement.
Furthermore, college students are looking for companies to be on Facebook. This demographic
believes that it is important for firms to be on the SNS to keep up with their competition. They
also indicated that they believed companies should be on the site regardless of if they “Like”
them or not. From these insights, one can conclude that companies that target college students
should create a Facebook Page, if they have not already done so. Most respondents also stated
that being on Facebook allows companies to inform their followers faster. As students are
spending five to ten minutes on the site at least four to five times per day, this feedback makes
sense. Individuals will be much more likely to see updates in their newsfeed than they would be
to check the company’s website. Thus, connecting with students through a medium with which
they are very familiar contributes to CRM.
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Additional support for this conclusion is evidenced by the percentage of individuals who had
“Liked” a company in the past month. The majority of students claimed to have done so, and of
these respondents, most “Liked” said company because they loved its brands. Therefore, one can
infer that students wish to show their support for companies by joining their brand communities
on Facebook. The fact that people tend to “Like” companies for this reason, and not because they
were offered an incentive is encouraging. Facebook can also be seen as an avenue for consumers
to conduct an external information search, as of the 86.34% of individuals who had seen an ad
asking them to find the company on Facebook, 37.55% did just that. Overall, Facebook is a
legitimate channel to connect and communicate with consumers.
Still, students are generally apathetic about posts from companies in their newsfeeds.
Information from both the focus groups and the surveys indicates that, while they are usually not
annoyed by these updates, they do not tend to actively read them either. Yet, about 40% of
individuals surveyed indicated that they have learned useful information from updates from
companies in their newsfeeds. From these results, one can determine that though students do not
actively read these updates, they may capture their attention and convey important information.
Ultimately, this study has determined that companies should use Facebook as a CRM tool. While
Facebook Ads are not successful beyond generating some awareness, Facebook Pages are
frequently used by consumers to connect with companies, and vice versa. The results yielded
will guide firms in their use of Facebook as a promotional channel and their expectations of its
effectiveness.
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LIMITATIONS
Several limitations impacted the results of this study. First, mostly sophomores participated in
both the focus groups and the surveys. Therefore, if there are differences between the classes of
college students, they were not captured in the results. In addition, only Bryant University
students were included in the study. As Bryant requires all students to have a core business
education, these students may have more business oriented opinions. Thus, they may have
reacted more positively to questions such as “I think companies must be on Facebook to keep up
with their competition” and “even if I do not “Like” a company, I think they should be on
Facebook,” than the average college student. Furthermore, this study relied heavily on self
reports to collect data. However, there could be a significant difference between students’
reported behavior and their actual behavior. Finally, time constraints limited the length of the
survey administered. As multiple surveys are given during each behavioral lab session, it was
necessary that this questionnaire be kept somewhat concise.
FUTURE RESEARCH
Though this analysis provided meaningful results, much can be built upon this research. First, the
study can be repeated in a larger population with a larger sample size to test for consistency. In
addition, Facebook, like all SNSs, is extremely dynamic. Therefore, repeating this study in six
months could yield drastically different responses. Additionally, researchers could add to the
richness of this study by testing recall of Facebook Ads. In order to accomplish this task,
researchers would include mock Facebook profiles with Ads in the survey. Then students would
be asked to recall what Ads they were shown. Currently, researchers can examine students’
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actual behavior while on the site, rather than asking them to recall what they have done in the
past. For this approach, researchers could record participants’ behavior on the site or examine
their computer history, with their consent. Assessing users’ behavior on the site will more
accurately detail their interactions with companies regarding Facebook Ads and Pages.
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APPENDIX A – THE FACEBOOK SALES FUNNEL
Source: O'Neill, N. (2009, June 29). The 5 Phases of the Facebook Sales Funnel. Retrieved
January 25 , 2011, from All Facebook: http://www.allfacebook.com/facebook-sales-
funnel-2009-06
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Appendix B – Linkages Between Marketing, Customer Service and Quality
Marketing
Quality
Customer
Service
Customer Service levels should
be determined by research-
based measurement of customer
needs and competitors’
performance and must
recognize needs of different
market segments
Quality must be determined
from the perspective of the
customer based on regular
research and monitoring
The Total Quality concept should
influence both the process elements
(eg designing out failure points) and
people elements (eg managing
‘moments of truth’ in the customer
encounter)
Source: Yesim, D. (2010). Determinant Factors of Time Spent on Facebook: Brand Community
Engagement and Usage Types . Journal of Yasar University , 2949-2957.
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Appendix C – Focus Group Guide
Briefing: My name is Courtney Weiss and I am a Senior Honors Student. I am currently
completing my Honors Capstone pertaining to social networking, Facebook in particular This
afternoon I will be facilitating your discussion on this topic. Please answer as honestly as
possible, as there are no right or wrong answers.
Your identities will be kept completely confidential in my report. While this discussion is being
filmed, I assure you that only I will see the recording. Once my project is completed I will
dispose of the tape. Does anyone have any questions before we begin?
Introductions: Each participant will be asked to introduce him or herself along with their year
and major.
General Facebook Usage Questions
• How often would you say that you log onto Facebook?
o Depending on responses, probe for more information
If daily, how many times per day?
• When you log onto Facebook, how long do you spend on the site?
• When you’re on Facebook, what kinds of things do you do?
Ad Questions
• Have you ever noticed any ads on your Facebook page?
• How do you feel about these ads?
o See where this discussion goes. If it is slow or getting off track, ask the questions
below
How closely do you feel that these ads relate to your interests?
How often do you read the ads on the side of your Facebook page?
How often to you click the ads on the side of your Facebook page?
When you have clicked on these ads, has it ever led to further engagement
with the company on your part?
Ex) visiting the website, visiting the Facebook page, searching for
promotional information, printing coupons, visiting the retail location,
making a purchase
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Questions about Company Pages
• What about company Facebook pages? Do you ever visit them? Do you “like” them?
o Questions to Guide Discussion
So how many companies/Brands have you “Liked” on Facebook?
What types of brands are they?
When you “Like” a company/brand, do you visit their page after the
initial visit?
• After you’ve “liked” a company or brand, how do you feel about seeing updates
from companies in your newsfeed?
o Do you follow up with updates by companies in your newsfeed? If so, how?
• What types of activities do you engage in on the page of brands that you have
“liked”?
o Clarification – Do you ever “Like” comments written by company
representatives or other fans, browsing pictures, posting comments, looking for
promotional information, etc.
• What types of information do companies need to post in order for you to visit their
pages more frequently and/or grab your attention in your newsfeed?
o Information on new products/services
o Information on promotions
o Coupons/E-deals
o Events
Debriefing
You may have noticed that I asked many questions pertaining to ads on Facebook or
company posts in your newsfeed. Your responses will help me explore how effective companies
are in communicating with college students on Facebook. In particular, I am interested to learn if
Customer Relationship Marketing through company fan pages is more effective than straight
marketing through Facebook Ads. Please see me or email me if you have an further questions.
Thank you.
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Appendix D - Survey
Hello: You are invited to participate in our survey pertaining to students Facebook usage. In this
survey, people will be asked to complete a survey that asks questions about the types of behavior
they engage in on Facebook. It will take approximately 10 minutes to complete the
questionnaire. Your participation in this study is completely voluntary. There are no foreseeable
risks associated with this project. However, if you feel uncomfortable answering any questions,
you can withdraw from the survey at any point. It is very important for us to learn your opinions.
Your survey responses will be strictly confidential and data from this research will be reported
only in the aggregate. Your information will be coded and will remain confidential. If you have
questions at any time about the survey or the procedures, you may contact Courtney Weiss at
860-271-6528 or by email at [email protected]Thank you very much for your time and
support. Please start with the survey now by clicking on the Continue button below.
Do you have a Facebook account?
1. Yes
2. No
How often do you log on to Facebook?
1. Once a week
2. 2-6 times per week
3. Daily
4. Multiple times per day
5. Leave a Facebook tab open daily while online
How long do you actively stay on Facebook during a typical visit?
1. Less than five minutes
2. 5-15 minutes
3. 16-30 minutes
4. 31-60 minutes
5. More than an hour
What types of things do you do while on Facebook? Check all that apply
1. Post pictures
2. Post Statues
3. Communicate with friends
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4. Post links
5. Look at other people's profiles/pictures
6. Play games
7. Other
9.Do you ever notice Ads on Facebook?
1. Yes
2. No
Where do you notice ads? Check all that apply
1. On the side of the page
2. While playing games
3. While using apps
4. Other
Do any of the ads you see on Facebook align with your interests?
1. Yes
2. No
Do you actively read any ads on Facebook?
1. Yes
2. No
In the past month, have you ever clicked on the ads on Facebook?
1. Yes
2. No
How frequently do you click on ads on Facebook?
1. Once or twice
2. Occasionally
3. Once per Month
4. Once per Week
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5. Daily
What prompts you to click on Facebook Ads? Select all that apply
1. Striking Graphics
2. Text
3. Boredom
4. Recognize company or logo
5. It was suggested by Facebook
6. Other
In the past month, what types of Facebook ads have you clicked on? Select all that apply
1. Sports
2. Movies
3. TV Shows
4. Books
5. Musical Artists
6. Clothing
7. Other
In the past month, have you “Liked” any companies on Facebook?
1. Yes
2. No
In the past month, bout how many companies have you “Liked” on Facebook?
1. 1-2
2. 3-4
3. 5-7
4. 8-10
5. 11+
What types of companies have you "Liked"? Check all that apply
1. Restaurants
2. Clothing Brands
3. Accessory Brands
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4. Non-Profit Organizations
5. Personal Care Product Brands
6. Home Product Brands
7. Athletic Equipment Brands
8. Other
Complete the following statement: the companies I “Like” on Facebook tend to be
1. Local small businesses
2. Regional small businesses
3. National companies
4. International Companies
5. A mix of local and corporate companies
What prompted you to “Like” this/these companies?
1. I love their brands
2. I was entering a contest
3. I was offered a discount
4. I wanted to find out more information about their products or services
5. I wanted to find out about events
6. I wanted to find out about sales
Have you ever seen a television or print ad asking you to find the company on Facebook?
1. Yes
2. No
Have you then searched for the company on Facebook?
1. Yes
2. No
What would a company have to do to get you to “Like” its Facebook Page?
1. Offer products and/or services that I use frequently
2. Offer me a discount
3. Hold special events for Facebook followers
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4. Hold a contest for Facebook followers
5. Post exclusive product previews on Facebook
6. Other
__________________________________________________________________________
__________________________________________________________________________
____________
In the past month, have you ever “Liked” a movie on Facebook?
1. Yes
2. No
In the past month, have you “Liked” a TV show on Facebook?
1. Yes
2. No
In the past month, have you “Liked” a band or musical artist on Facebook?
1. Yes
2. No
How have you found movies, TV shows or musical artists to follow? Check all that apply
1. I searched for my favorite TV shows, movies and musical artists
2. Facebook suggested that I follow them
3. I saw that a friend had liked them
4. Other
In the past month, have you used Facebook to check in at a place of business?
1. Yes
2. No
Why have you checked in a place of business?
1. I was offered a discount or special offer if I checked in
2. I wanted to show my support for the business
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3. I wanted to see who else was there
4. Other
__________________________________________________________________________
__________________________________________________________________________
____________
In the past month, have you shared information about products or services with your friends on
Facebook?
1. Yes
2. No
If yes, how did you do so?
1. Posted a link to a webpage in your status
2. Posted a link to a webpage on a Friend’s wall
3. sent a link to a webpage to a friend in Facebook Chat
4. Posted a video or commercial in your status
5. Posted a video or commercial on a friend’s wall
6. Sent a video or commercial to a friend in Facebook Chat
How do you feel about the following statements
Strongly
Agree
Agree Neither
Agree Nor
Disagree
Disagree Strongly
Disagree
I trust the ads I see on Facebook enough to
click on them
❏ ❏ ❏ ❏ ❏
I believe the ads on Facebook will give my
computer viruses
❏ ❏ ❏ ❏ ❏
Companies that advertise on Facebook are
reputable
❏ ❏ ❏ ❏ ❏
Clicking on a Facebook ad will lead me to
the companys website
❏ ❏ ❏ ❏ ❏
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How do you feel about the following statements
Strongly
Disagree
Disagree Neither
Agree Nor
Disagree
Agree Strongly
Agree
I think companies must be on Facebook to
keep up with their competition
❏ ❏ ❏ ❏ ❏
Even if I do not Like a company, I think
they should be on Facebook
❏ ❏ ❏ ❏ ❏
Being on Facebook allows companies to
inform followers faster
❏ ❏ ❏ ❏ ❏
I will only Like a company on Facebook if
offered an incentive (such as a coupon or
discount)
❏ ❏ ❏ ❏ ❏
I feel more connected to companies that Ive
Liked on Facebook
❏ ❏ ❏ ❏ ❏
I find updates from companies Ive Liked in
my newsfeed to be annoying
❏ ❏ ❏ ❏ ❏
Ive learned useful information from updates
from companies in my newsfeed
❏ ❏ ❏ ❏ ❏
How do you feel about the following statements
Strongly
Agree
Agree Neither
Agree Nor
Disagree
Disagree Strongly
Disagree
Following a musical artist on Facebook
makes me feel more connected to him/her
❏ ❏ ❏ ❏ ❏
Following a musical artist on Facebook has
allowed me to learn information I may have
not heard without following him/her (such
as concert dates, contests, personal
information ect.)
❏ ❏ ❏ ❏ ❏
I am more likely to Like a movie, TV show,
or musical artist on Facebook than I am to
❏ ❏ ❏ ❏ ❏
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Like a business
How old are you?
What is your gender?
1. Male
2. Female
What is your year in college?
1. Freshman
2. Sophomore
3. Junior
4. Senior
What is your zipcode?
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Appendix E - Attitudes Towards Company Facebook Pages
Question Strong
Disagree
Disagree Neither
Agree Nor
Disagree
Agree Strongly
Agree
I think companies
must be on
Facebook to keep
up with their
competition
3.49%
7.86%
17.03%
52.84%
18.78%
Even if I do not
“Like” a company,
I think they should
be on Facebook
6.09%
6.09%
23.48%
48.70%
15.65%
Being on Facebook
allows companies
to inform followers
faster
5.22%
4.35%
13.04%
52.17%
25.22%
I will only “Like” a
company on
Facebook if
offered an
incentive (such as
a coupon or
discount)
9.17%
26.20%
27.95%
27.51%
9.17%
I feel more
connected to
companies that
I’ve “Liked” on
Facebook
9.61%
18.78%
38.43%
27.95%
5.24%
I find updates from
companies I’ve
“Liked” in my
Newsfeed to be
annoying
3.51%
18.86%
45.61%
25.00%
7.02%
I’ve learned useful
information from
updates from
companies in my
newsfeed
3.49%
14.85%
39.74%
37.55%
4.37%
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Appendix F: Attitudes Towards Entertainment Pages on Facebook
Question Strongly
Agree
Agree Neither Agree
Nor Disagree
Disagree Strongly
Disagree
Following a
musical artist on
Facebook makes
me feel more
connected to
him/her
9.21%
32.69%
28.95%
21.05%
7.89%
Following a
musical artist on
Facebook has
allowed me to
learn information
I may not have
heard without
following him/her
16.81%
46.46%
20.35%
11.95%
4.42%
I am more likely
to “Like” a
movie, TV show
or musical artist
on Facebook than
I am to “Like” a
business
25.76%
37.55%
20.96%
8.73%
6.99%
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Holzner, S. (2009). Facebook Marketing: Leverage Social Media to Grow Your Business .
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O'Neill, N. (2009, July 16). 10 Rules for Advertising on Facebook. Retrieved January 25 , 2011,
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