Social Media Measurement, Social Media ROI

Did This National Restaurant Chain Put Too Much Love Into the Like?

I’m glad that more and more companies are putting significant effort into their social media programs. Really, I am.

But, we can’t let enthusiasm obfuscate reality, and that seems to be occurring with alarming regularity these days in all corners of the social Web.

The most recent example to cross my inbox is from restaurant chain Buca di Beppo. I’m a fan of these eateries, and have spent many lovely evenings at various locations, gorging myself on meatballs with friends and family. But when it comes to their Facebook promotion, I’m feeling a little sick to my stomach.

We’re Crazy About Likes

I received two emailed press releases with no cover note and no personalization or explanation of any kind from Braintrust Marketing & Communications in Las Vegas (presumably the agency for Buca di Beppo).

They breathlessly tout the results of the restaurant’s Social Media Day promotion (did you miss social media day? It was on June 30. Send carnations next year). Evidently, this national restaurant chain (a division of Planet Hollywood) went from 66,000 Facebook “likes” to more than 100,000 in just one day.

To achieve this milestone, Buca used its email database of more than one million eClub subscribers, promising that if 100,000 total likes were tallied by June 30, all eClub members would receive a $10 gift certificate.

Body.jpg e1309719226197 Did This National Restaurant Chain Put Too Much Love Into the Like?Not surprisingly, the company cracked the 100,000 barrier the same day the email was sent.

Ummm, okay.

A national restaurant chain sends one MILLION emails offering $10 worth of free food, and is overjoyed when 34,000 of those recipients clicks one button called “like” on the same day the email was received? Let’s look at the metrics of this program:

  • Let’s assume that 73% of Buca di Beppo’s email club visits Facebook (matching the U.S. average, based on Comscore’s findings to that effect in May, 2011). Buca says their eClub is more than one million strong, but let’s use an even one million. Thus, we’ll stipulate that 730,000 eClub recipients are on Facebook.
  • Let’s assume that 23.3% of Buca di Beppo’s subscribers open emails from the company. I have no idea what their open rate is, but 23.3% was reported by major email provider Epsilon in the first quarter of 2011 as the industry average. That would mean that 170,090 Facebook-using eClubbers opened and read the offer.
  • At least 34,000 of that group acquiesced and agreed to “like” Buca di Beppo, which is a conversion rate of 3.4% of the total list, and 19.9% of the Facebook-using email openers.

A 3.4% overall conversion rate, and a 19.9% conversion rate among a very targeted group. Not bad, but this is not the stuff of which marketing legends are made. (In the interest of mathematical equanimity, both of these % are actually slightly higher because some portion of the email recipients were already fans of the brand on Facebook)

There’s No Such Thing as a Free Like

Now, let’s consider the cost side of the equation.

    • Because the promotion was successful, one million eClub members will receive a $10 coupon. Not all of them will be redeemed, and certainly $10 is not enough to eat at Buca, so these reward certificates will no doubt drive incremental store visits (and I like that those rewards are theoretically trackable at the store level, so they can determine ultimate redemption rates). But, the potential cost of this promotion in top-line revenue is $10 million. (Further, the restaurant provides a free appetizer when signing up for eClub, a free brownie on your birthday, and a free dessert on your anniversary. They are definitely aggressive about their CRM program)
    • Sending one million emails isn’t free, either. I don’t know who Buca uses for email, but I’m going to assume for our purposes here that they are paying an email provider .003 per sent email, a competitive rate for mid-volume senders. That would put the email sending cost at $6,000 for at least two emails (announcing the promotion, and then sending out the reward certificates).

Buca di Beppo 11 1 270x300 Did This National Restaurant Chain Put Too Much Love Into the Like?

  • You also have costs for Facebook page creation (they have one of the best landing pages I’ve seen) and management, email design and management, and PR firm costs to create and distribute the release (although I’m assuming blast emails to bloggers are pretty cheap these days. In fairness, the PR firm was very good about getting back to me with answers to some follow up questions I had).

 

Buca di Beppo was able to drive consumer behavior quickly. But they had to outlay a lot of cash and effort to do so. And what now? You’ve bought some likes from people that ALREADY were fans of the brand because they were on the eClub list.

A worthy goal would be that EVERY member of the eClub on Facebook should be a fan of Buca. That would be something like 730,000 likes, not 100,000. And since they’ve already taken the effort to sign up for email, shouldn’t you be able to make that happen without giving them each $10 to click a button?

This quote from the Director of Interactive Marketing at Planet Hollywood encapsulates the danger of this type of “yea, we got likes!” thinking:

All Mailboxes Found 11 matches for search Did This National Restaurant Chain Put Too Much Love Into the Like?
I’d argue that you at Buca di Beppo saw firsthand the power of “giving $10 each to people who already have said they like you” possesses, and continuing to embrace that is to snuggle up to the false prophet of fuzzy social media math.

I give Buca credit for putting so much weight behind their liking campaign. But I’m not sure the math matches the method. I would love to see a press release in 30 days from Buca that shows redemption rate and average check stemming from the $10 reward certificate program, so true ROI could be calculated.

  • AndyWhyteUK

    Interesting points Jay. Although when you compare the cost that has gone into this process to that of running a Groupon I’m sure the ROI isn’t too dissimilar and they have the bonus of having built a great Facebook base of customers.

    • http://www.convinceandconvert.com JayBaer

      @AndyWhyteUK Yes. Versus Groupon, I think I prefer this program because you’re tapping into a base of already-primed customers. Groupon can end up with a lot of one time Johnnies that never buy from you again.

      • foodiegrl

        @JayBaer @AndyWhyteUK Don’t forget that these “One-time Johnnies” are actually a bonus in this case. I tried to read through the responses here, and I can’t seem to see anyone who acknowledged the viral opportunity of the campaign. Sure, your loyal email recipients may already be engaged when they get the offer, but this is a highly shareable offer. What better way to introduce your business to INCREMENTAL “Johnnies”, without bending over and paying Groupon at 2x what the discount would cost your business. I would imagine that somewhere in their success metrics is the number of NEW guests, not loyalty members, who redeemed the offer?

  • TrafficColeman

    Very smart of them to offer discounts to just get people to take actions. Sometimes you have to give a little to get something back in return.

    “Black Seo Guy “Signing Off”

    • http://www.convinceandconvert.com JayBaer

      @TrafficColeman I’m okay in theory with giving a little to get a little. The question here is are the giving too much, and are they giving it to the right people?

      • Tim_Weaver

        @JayBaer @TrafficColeman Was the goal to reward long-time customers, get new customers or both? If the former, the email campaign would appear to have been sufficient. If the latter, how is someone NOT on your email list going to receive the message? Same question for those NOT already a fan on FB? If the answer was “both”, then I am unsure their strategy was optimal, since it would have relied on pass-through notification from current customers to potential customers.

        I’ll admit to being a little out of my lane here, but this strikes me as a ploy to be able to say “We increased our FB base by 52% in one day.”

        My “so what?” is followed by “…and then what?”

      • Cranium368

        @JayBaer @TrafficColeman When the average check at Buca is probably around $30-$50, I don’t think a $10 with purchase offer was “giving to much”.

  • CharityHisle

    RT @chadrichards Did This National Restaurant Chain Put Too Much Love Into the Like? http://t.co/PRhV6r4

  • TomMartin

    Jay

    I’d ask an even bigger question… why bother doing this at all? They already had a relationship via email, so while yes, they now can talk more frequently (theoretically) to these new “likes” without worrying so much about unsub #’s and cost of transmissions… but seriously — why not just offer everyone a $10 Certificate for being a fan (via email) — if all you really wanted was incremental traffic. Odd. While I agree, would love to see redemption rate, better I’d like to see their “Day After” marketing plan. Now that they have all of these new likes, what are they going to do with them. What does the next 30-60 or 90 days of FB content plan look like? Seems to me that if they get all of these new Likes but those folks never bother to interact with the FB page (distinct possibility) then all they’re going to do in the long-run is damage their EdgeRank (more fans with less interaction) and thus in the long run do themselves more damage than good where their FB efforts are concerned. Lastly, had to laugh at the quote — what they saw wasn’t the power of social media, what they saw was the power of email.

    Good stuff man… thanks for sharing.

    tommartin

    • http://www.convinceandconvert.com JayBaer

      @TomMartin tommartin Yeah, sometimes we overlook email because it’s not cool anymore, but as far as I know, it still creates the most persistent and highest ROI of any channel.

  • CanyonComm

    Great points all. You highlight a key question I have — “What Now Buca” aka their “Day After” marketing plan. Seems as if they may be illustrating the dark side of social business tactics and headed for a mini-Groupon-esque social hangover. Time will tell and I’ll certainly be watching. Welcome back from vacation Jay!

    • http://www.convinceandconvert.com JayBaer

      @CanyonComm Good example with Groupon. That’s indeed a bit how this feels to me.

  • LenShneyder

    According to Facebook execs, those who like are 4x more likely to buy. They now have 100k people that are 4x more likely to convert when they create the next round of targeted FB campaigns. I think it’s a lot of money to get to that swollen river of likes, but there’s potential in them there hills and I think we have yet to see what that potential is. Agree that it’s more expensive to conduct this kind of lead gen than email or other channels, but it’s the new shiny toy so it makes sense.

    • http://www.convinceandconvert.com JayBaer

      @LenShneyder I’m not certain Facebook execs are the most objective source for the long-term value of likes, but indeed the premise that Likes will yield future purchase seems to hold water. The issue I have (as Tom Martin mentions in his comment below) is that they pulled those “likes” from people that they already HAVE. I’m not sure that double-dip makes the most sense.

      • Cranium368

        @JayBaer @LenShneyder Facebook and email both have their advantages. Though I think some of the restrictions put on the coupon hurt them in the long run, it seems like they accomplished their goal. After viewing their page, it seems they interact often and have built relationships, recognizing both positive and negative situations. I think they are slowly figuring it out. Having the larger audience will create more pressure for their next act and also allow them to share up to date news and information without flooding and annoying a users inbox. I am curious to see “whats next” for Buca.

  • ScottSchablow

    Jay, Just curious to know, since you like to eat there, if you are an eClub subscriber? If not, why not? If yes, did you see or respond to the ‘like me’ email? I’m always curious about behavior & motivation. Back to the story – While it would be easy for me question the budgeting wisdom of this promotion I do applaud them for experimenting. They may have anticipated many more likes than they received which would have made the experiment (more) successful. But as with all experiments, we cannot control the end result. I would be interested to see 1. The after plan as some have mentioned and 2. How they apply what they learned here into the NEXT experiment or promotion. I would say that we shouldn’t criticize social media experimental efforts but they invited the scrutiny (in THIS case something I would NOT have done). Thank you for sharing because one of the questions worth considering is “Have you done your homework on acquisition costs?” And, “What are you going to do afterward?” I still get calls from businesses that say, “We have 100.000 or 500,000 Facebook fans and we don’t know what to do with them. My question back is what were the goals and objectives outlined in your strategy? A long period of silence ensues.

    • http://www.convinceandconvert.com JayBaer

      @ScottSchablow Hi Scott. I am not an eClub subscriber because I haven’t lived in a market that has a Bucca. I’ve always gone with family when visiting them in different parts of the country. Thanks for the excellent comment. I think many of us here share the same thoughts around “what happens next?”

  • http://www.marketingsense.wordpress.com/ Colin_N_Clarke

    The big question is, what will they do with the additional LIKES? Flashback to Fall 2009 and TGI Friday’s WOODY campaign to reach 1 million LIKES. It was an excellent integrated campaign, they reached their million, had a nightmare with reward fulfillment (free burger), then did almost nothing to follow-up, activate and engage their following. Now 2 years later their LIKES have dropped to 617,000 (although Buca would be jealous of that number!).

    On the other hand, Buffalo Wild Wings does a pretty decent job. They engage their followers and throw out some coupons once in a while to those watching. I would venture that they likely can spike redemption (and sales) on any given week. And if LIKES are any proof… they are at nearly 5 million (Buca would REALLY be jealous!).

    Like a famous marketer once said, “It’s not about collecting friends (or likes), it’s about engaging them.” (Jay Baer, 4-28-11, Fargo, ND). Curious if Buca will do anything meaningful to validate their recent spend on collecting more LIKES?

    • http://www.convinceandconvert.com JayBaer

      @Colin_N_Clarke Thanks Colin. Great example with BWW. They do a super job on an ongoing basis.

  • http://rmctech.net/ Ryan Critchett

    I agree with what Colin said in the intro of his comment. What you’re doing with the likes is really what matters! It’s crazy to watch this numbers game, where everyone wants a billion likes, just to say they have them. I think social media has hit a critical point, where if you’re going to really do it big, you’ll have to break through the noise.

    Thanks for breaking down the metrics Jay. Sawwweeeet post.

  • FelipeOwen

    Fantastic read and use of metrics. Reads like a good baseball article, but it’s for work! Gushing aside, I’d be interested to know what that “some portion of email recipients who were already fans” on Facebook actually is. It seems like that % could possibly be a redeeming factor, or (most likely) the most damning factor.

  • http://thewebshoppe.net/ TheWebShoppe

    It’s hard to say if this campaign was successful without knowing the goals of the campaign. It appears that the goal was just to get fans. In that case, going after the email list and offering spiffs would be the best method. If they are looking for new customers, not so much. Having fans and an active Facebook page gets you more fans, so maybe this is just phase one of a larger campaign to target a younger audience.

  • jaybaer

    @DonnaTocci Thanks Donna. Agreed!

  • stevegrantz

    @jaybaer Great look at the Bucca FB like campaign http://t.co/GBNmnTO – the kind of analysis marketers should conduct to evaluate results

  • jaybaer

    @CarolSchiller hey thanks Carol!

  • BrettPWms

    RT @jaybaer e we falling too much in love with the “like”? http://t.co/3GTZRCo <“like”>

  • BrettPWms

    RT @jaybaer Are we falling too much in love with the “like”? http://t.co/3GTZRCo <“Like”>

  • CBLangev

    @jaybaer It’s likely…RT Are we falling too much in love with the “like”? http://t.co/hcVfROD

  • GreenA_V

    Hmmm, seems like the goal is to get people into their restaurants to spend money. So, give them what is basically a $10 coupon to get that incremental spend you mentioned…I get $10 “gift certificates” to Buca in the local money mailer, Buy1Get1, etc. all the time. But I don’t publicly put my name on their FB page to get it, nor do I potentially encourage others in my network to do the same. And, I don’t feel “rewarded” for being a loyal liker/club member. Something to be said for rewarding an action…

    Seeing as those ads require design and distribution fees also, maybe this was a comparable spend for them but they were able to take advantage of a publicity campaign at the same time.

    Of course, this might be a super, overly simplistic view…but just a few thoughts that came to mind :)

    • http://www.convinceandconvert.com JayBaer

      @GreenA_V Since I’m not in a Buca market, I don’t see those coupons in money mailers, etc., and indeed if they are that aggressive with that promotion, it must be a good tactic for them. That does make me feel better about the coupon piece of this pie.

      • GreenA_V

        @JayBaer @GreenA_V Aw Jay, you’re so darn nice!! The thread about @unmarketing and vacation is making me smile too. @SociallyGenius You should just mention unicorns. a particular (weird?) soft (odd?) spot for our friend Scott. pretty much irresistible for him, you’ll get a reply like almost instantly.

  • DirectResponse.net

    Love Buca di Beppo. I couldn’t stop repeating the name over and over again the first time I went there. Only problem was it was a luxury restaurant for my budget and didn’t plan on returning anytime soon for that reason.

    I don’t really remember doing this, but I guess I signed up for their eClub list. I received countless emails after that trip to the point where I unsubscribed. Seems I missed out on my $10 coupon. Which at Buca di Beppo could pay for…my water. Love the food though!

  • AlexBernstein

    Jay,

    Don’t you think they would have tried to give away these coupons anyway?

    They likely already know that the $10 off coupons help drive door traffic (transaction volume up) and that they make enough margin off each ticket that renders the $10 coupon a rounding error. (yes, slightly less margin…but on a larger number of total transactions)

    If a million diners all descend upon Buca this summer waving their $10 off coupons, they’d probably set records for BOTH top line revenue AND earnings. 100% redemption rate wouldn’t be a “10 million cost” it would likely be a $80-$100M windfall. Especially given the fixed costs of running a restaurant, this seems like a no-brainer.

    Yep, the conversion rates aren’t amazing, but hardly seems like it could add up to an “oops” when I do the math.

    Alex

    • http://www.convinceandconvert.com JayBaer

      @AlexBernstein Agreed. I don’t think it’s necessarily an oops as I said in my reply to Jay above. Not sure giving away a coupon to your existing fans merits a press release, however.

  • jaykeith

    Jay,

    I understand the point of this post, but I’m bothered that it was written with an awful lot of speculation and “assumptions.” I understand you’re asking the question and tossing it out there hypothetically, but in reality you have no idea what this campaign generated, how much revenue it might have brought through the doors and what the real costs were.

    But my real argument is with two of your points First, you said that that the campaign had the potential to cost 10 million in top line revenue. That means you assume that people come in, redeem their $10 coupon and leave. Even if people did that, it still wouldn’t actually cost the chain $10 million, you know that. But you don’t equate for (you mentioned it, but didn’t use an “assumed number” like with the costs) the incremental value of that coupon driving people through the door, purchasing a full meal and drinks, etc. Why didn’t you assume that Buca’s average order is $50 (reasonable) and that 2% of the one million that got the coupon redeemed it. That means 20,000 people came in and had a meal, used the coupon and paid $40. That’s $800,000 in additional revenue, tracked back to the coupon campaign. Think that was enough to pay for the campaign?

    Secondly, for everyone (including you) wondering why a company would do this and try to drive existing customers to “like” their facebook page, the answer is extremely simple: email is a dying medium. Yes it might be a slow death, but companies that are driving customers to facebook and other SM properties are essentially building their direct marketing machines of the future. it’s as simple as “you go where the people are.” facebook allows you to market directly to fans, advertise to them and communicate with them. If you’re effective as a marketer, you don’t want all your eggs in an email basket. i would ask, where’s the downside?

    From my view this was an incredibly effective email marketing campaign that had a clear call to action, gave customers a reason to purchase and had the additional benefit of driving them to a platform that they will no doubt grow and use as a direct marketing platform for the next five years (at least).

    • http://www.convinceandconvert.com JayBaer

      @jaykeith Hi Jay. Thanks for taking the time to comment. I very much acknowledged the revenue potential: “…certainly $10 is not enough to eat at Buca, so these reward certificates will no doubt drive incremental store visits”. Indeed, I didn’t use an assumption for the bounce-back ratio, and perhaps I should have.

      But your calculation is flawed because it assumes that your hypothetical 2% would not have returned without a $10 coupon. It’s not $800,000, it’s some portion of that you wouldn’t have otherwise.

      Further, and more to the point, this post wasn’t about the profitability of the campaign. I didn’t say it was a bad campaign. What it isn’t (in my estimation) is a campaign worthy of sending press releases and proclaiming the power of social media. I agree with you that this is an email campaign, but Bucca certainly didn’t position it as such in their outreach, and that’s where the real issue lies in my estimation.

      And in terms of email being a dying medium, you may or may not be correct. Certainly young people seem to be using email less. But if you think Facebook is a reliable substitute for businesses, I fear you’re going to be disappointed. Lots of research shows (most recently PageLever data) that 3.5%-7.5% of your Facebook fans ever see your status updates, and % of your audience visiting tabs is even lower. Email deliverability rates are 99% for most ESPs. That’s a huge gap. Even if you use open rates, I’ll take 23.5% vs. 3.5% – 7.5%.

      I’m not anti-Facebook. Hell, I make a nice living (in part) by helping people do it better. But email is a reliable channel whereby if I send you something, YOU decide whether to act upon it. In Facebook’s case, their algorithm decides – partly based on your historical propensities – whether you see it and even have a CHANCE to act upon it. That’s not a scheme I want to embrace at the expense of email.

      As with all things, the answer is integration. I very much support and recommend trying to get Facebook “likes” from your email subscribers, to have multiple touch-points with them. I’m just not sure I would have put a coupon behind it (but as we’ve both acknowledged, that’s hard to determine without ROI data).

      • jaykeith

        @JayBaer Jay, no problem, it’s definitely an interesting discussion.

        And you’re right, it wouldn’t be all of the 2%, but even if it’s 1/2, that’s significant ROI for a single campaign. As for email, deliverability rates are at 99%, but conversion rates (the most important stat in my opinion) with emails are typically in the single digits. I hear you on Facebook’s algorithms and numbers, but I can tell you first hand those can also have big swings. Vistaprint’s community has very high engagement rates and extremely high impressions, so it’s all how you optimize and give your audience what they want. Having said that, I see your point and agree that integration is key, that’s why I personally loved this campaign.

        i just read this post more as “this campaign wasn’t effective based on costs” more than, “it’s not worthy of press releases and outreach.” But since it sparked a good discussion, it was well worth the read.

  • dsoyka

    Thanks for the excellent column! I would question the overall strategy – to my thinking, the FB like is the gateway to try to migrate a fan to become an opt-in member and eventually a customer. (someone earlier said “it’s what you do with the Like”) Paying good money to get your existing opt-ins to move back up the funnel seems counter-intuitive. While social is the new viral and everyone is looking for their cool points, I would think 1MM registered opt-ins is way more valuable than 100K Likes, or even 1MM likes for that matter.

  • jaybaer

    @unmarketing thanks for the RT my man.

    • unmarketing

      @jaybaer as always, it’s my pleasure to spread the awesome. How was the vacation?

      • jaybaer

        @unmarketing Best. Vacation. Evah.

        • joey_strawn

          @jaybaer Ooh, vacation? Where did you go?

        • unmarketing

          @jaybaer awesome. I just got home from my final trip. Phew

        • jaybaer

          @joey_strawn Spent some time on a tiny island in French Polynesia. Devine!

        • jaybaer

          @unmarketing Yeah I’m home now for 6 weeks. Longest I’ll have been home consecutively since 2003.

        • joey_strawn

          @jaybaer That sounds heavenly. The wife and I are invading Vegas next week.

        • WhiteWitRhythm

          @jaybaer wow welcome home and I hope you enjoy it!

        • unmarketing

          @jaybaer we should meet in Vegas and celebrate. No, wait…

        • omazingK

          @unmarketing did i hear Vegas?

        • sherowcqjyah4

          @joey_strawn http://bit.ly/oqniH2

      • SociallyGenius

        @unmarketing Can I ask you for some candid feedback… Why have you never replied to us or acknowledged any mentions?

        • unmarketing

          @SociallyGenius I don’t recall any direct questions at me. If I’ve missed them, I apologize. I try my best, but get overwhelmed sometimes

        • SociallyGenius

          @unmarketing Totally cool, its been awhile, just wanted to make sure we werent an elephant in the room… I Really admire your work

      • moussaewjgy3

        @unmarketing http://krz.ch/z5MR

  • eversadam

    Jay – I was the social media intern for Buca for a while. They use FishBowl as their email provider. I now work for Famous Dave’s as the social media marketer. We did a similar campaign before I started in July (2010). We gathered a ton of coupon hungry fans. We did a different offer – if you join the page between a certain time the first 100,000 fans got a $15 coupon. It worked we reached 100k fans but my personal opinion is quality over quantity. I would much rather have people naturally like our page than ‘buying’ fans. They are more actively engaged with the content and not just looking for coupons 24/7.

    My 2 cents.

  • brandizment

    That’s a great piece, and I’d argue a bit of a fail (only 3% when offered $10 at their favorite restaurant?). But I keep saying leave the poor defenseless ROI alone. Return on investment can not be accurately applied to social media efforts until we can all (or almost all) agree on what part of “social” is appropriate for the business sector and in what ways.

  • marsoezdk5

    @adamcooke12 http://bit.ly/n1KwgK

  • pmi_theSwimBack

    and #FF @ruxtermobi @foodieworld too

  • nickknaack

    @ChelseyJo Need a Google+ invite?

    • ChelseyJo

      @nickknaack I’ve been on Google+ since the beginning. But thanks!

      • nickknaack

        @ChelseyJo Ha, lucky you! :)

  • hvaldes

    That gives an idea for some of my clients. You show up during certain period of time with your mobile, and probe that you are following my page, and I will give you $10 usd discount (per table). Sounds cheaper and a lot less complicated. Greetings from Dominican Republic.

  • mark chmiel

    Very interesting comments. If this helps—I will guarantee they at least broke even—-and they gained X trial of their current or lapsed users. Also, they gained X number of “likes” now on their Facebook rolls. So from a marketing objective perspective—well done.

    Break even, why—-while I was at Denny’s we gave Free Grand Slams to anyone for a one day period, and advertised on the Super Bowl. We gave away 2 million, all free—-and made money on that day because people added items feeling so good about getting a “deal”. Further, one of my clients now ran a promo on Groupon–with a big discount. Same result—made money because consumers bought incrementally more.

    So if the goal was to gain Facebook users, and drive store traffic/trial—they succeeded and probably made money. Now other elements of the marketing mix should take over to continue frequency and up-sell etc—-so the promo really pays off with many purchases.

  • mikegalante

    @natanyap that’s $294 per fan. unless you’re talking about Ruth’s Chris addicts, prob not the best investment

  • http://vrazon.com/ ryanopaz

    You forgot to mention that they also got this great article…I wonder if it will be discussed around a table at one of their restaurants in the near future? :)

  • lynnstalone

    @livetodineout Lisa, thanks for the RT!

  • http://SHGWW.com/ jeffreysummers

    Couldn’t agree more @JayBaer . I think this also exemplifies the huge gap between understanding how to build and support a community by actually being a social business and the desire for instant social gratification through the use of “likes” and the like to calculate real impact with your community or substantiate marketing efforts. Lipstick on a pig.

    I won’t dignify the alchemy used to substantiate how Denny’s made money with their anti-social giveaways or the wishful thinking of Groupon use.

    Good post.

    • mark chmiel

      Hey Jeffrey—u totally missed the point. Re-read it. Think about strategy, his objection was it was too costly—simply not true. @jeffreysummers @JayBaer

      • http://SHGWW.com/ jeffreysummers

        Hey Mark – no I didn’t but you seem to misunderstand restaurant marketing completely. BDB could have used that money to create real fans in their dining room where it matters but chose to take the same mediocre route most business do with Facebook.

        Secondly, the lost opportunity cost of having wasted time and effort in the wrong direction is never accounted for.

        It’s also too costly when it’s a complete disconnect from what occurs inside your own four walls.

        You also don’t use social media as just another coupon delivery system – total waste of money there too.

        Discounting an experience that was previously marketed as a premium experience is value destroying – something Denny’s would never understand also.

        This is also not strategic is any sense of the word – it’s tactical. But when you’re desperate for people to “like” you this is what passes for serious marketing.

  • mark chmiel

    Thanks Jeffrey. Sorry that we disagree. My only response can possibly be is that you are quite presumptuous with little or no facts—typical of consultants. You do not know the objectives in this situation, at Denny’s or the example of a brand that used Groupon successfully (according to their benchmarks, not yours). Yet you have all the answers.

    And again you are dealing at the tactical level without any knowledge of the objectives or strategy. I was not commenting on the success or even intent of the “like” acquisition promotion itself. I was simply demonstrating that there is a financial pay-out–and that was a major question in the original article.

    Good luck.

  • jaybaer

    @shashib Thanks for the RT Shashi. Enjoy the weekend.

    • shashib

      @jaybaer You are welcome ! hope the weekend started off well

  • http://www.BeckyCortino.info BeckyCortino

    Thank you Jay, for explaining this important and necessary return on investment of time, money, resources to promote, in relation to the results. This has been happening since the beginning of promotional time offline, and certainly is a consideration online as well. Return (liquidating) – costs = successful promotion, presuming “The Offer” is an appealing one, and attracts the desired business/result.

    • susiejaps

      Becky totally agree with you! Thank you Jay, love your break down of this campaign! Really love it! I agree Buca is great at their CRM process/system, but what about NEWBIES?

      If their goal was to get as many ‘likes’ as possible on FB in a short amount of time – Mission Accomplished! If their goal was to get people who already are fans and contacts of Buca back into the restaurants – Mission Accomplished! Maybe those were the goals? Or maybe not?

      If more businesses were explained Social Networking Strategy & ROI the way you have explained it here to see how everything is connected, they would be way better off and only spending $ where they need to. Thanks for your hard work!

  • ohe_uwe

    @DavidBThomas yeah, that was cool to read. thx.

  • jaybaer

    @DavidBThomas Thanks pal. I appreciate that.

    • DavidBThomas

      @jaybaer My pleasure. Good stuff.

  • stephenmedawar

    Jay,

    Conceptually great article. Many times I have seen marketers (especially small business owners) get caught up in creating hype not sales.

    However, in this case, I’ve been on the receiving end of many Buca di Beppo e-mails. They hand out $10 gift certificates like Tootsie Rolls on Halloween. That being said, this may be an excellent response rate from an audience that probably has $10 gift certificate fatigue. The X factor your formula is how responsive their list is normally. Put another way, if their list is stale and this idea solicited a response, then this marketing effort may be considered a great success.

    I’m not sure we can simply extract the whole story from the numbers we’ve been given, as you have here.

  • nsmteam1

    great article! It seems that their goal was to get the name out there but not establish true relationships with clients. I was just reading another article recently that describes the opposite- creating one fan at a time: http://bit.ly/qwcyNj

  • SO_pr

    RT @debweinstein: Did this US Resto Chain put TOO much in love in the LIKE Button!? > http://cot.ag/oFmaF0 by @JayBaer

  • richchristianse

    It seems they definitely got sucked down the gravity well before figuring out their zigs and zags. That could be a costly mistake…or maybe not. Wish we could see the #’s!

  • derekmcclain

    Jay – I had a feeling you would be doing a blog post about this campaign as soon as I received the email from Buca! I remember your remarks during the Indy Social Media breakfast about businesses and people being crazy about # of likes or followers…LOL.

    I checked out Buca’s Facebook page a couple of days after the campaign was “over.” And guess what – a pretty substantial # of people complaining all over their wall. Why? Because the campaign wasn’t clear. Not only did you have to “like” the page. But then you had to sign up for their email list (if you weren’t already in it) in order to receive the coupon. A lot of people missed this point, so they were wondering where the coupon was.

    Also, the coupon had very short amount of time for which you could redeem it. I don’t remember exact amount of days but I am wanting to say like 3-5 days. As you can imagine, many “fans” couldn’t make it there within that time period. They were pretty upset and I even saw some posts of people saying, “Thanks for nothing Buca!”

    It all goes back to asking yourself if you are going to attract the “right” type of people by doing these types of promos. Do you want coupon chasers that are going to bitch the second they can’t use their coupon? Or do you want people that truly “like” Buca anyway and are real “fans?”

    • ann_donnelly

      @derekmcclain important points, was wondering if many unliked as soon as they could

  • http://www.socialmarketingdynamics.com/ Sydney @ Social Dynamics

    When you put it that way, they definitely gave more than what they got in return. They need a better social adviser, or they’d end up spending a chunk of their budget to their social practices.

  • clairejoey

    A fan bought with a bribe is not REALLY a fan at all & is unlikely to engage with the brand. Some companies just don’t get it. #fb

    • LucasShaffer

      @clairejoey I agree.

  • KarlSly

    From a business perspective we don’t know if this campaign makes sense or not, but from an emotional stand point I’d say they walked away with a huge success.

  • letstalkandchat

    I just found a great company that builds websites for info products. To keep your costs low, they’ll mentor you on how to create your site, design a marketing funnel (one of the guys works in Hollywood and makes really slick videos), and the other guy programmed Myspace. If you’re looking to have professional web design for your small business and not waste any time or money then check their site out. Check them out: http://www.mikelmurphy.com/easy-info-product-site-system/

  • IsaacAWardell

    I would argue that what you really have to figure out is what is the average amount that a Facebook Fan is worth over the life of their “Like.”. If the average Facebook fan eats one extra time per month at your business because they are a fan, resulting in say a extra $10 profit per visit (I have no idea what Buca’s average price point is, but based on the fact they are giving away $10, its likely they generate $10 profit on an order frequently) then you could easily spend $20 to attract a new fan, because you’re going to make $120 extra this year from them because they are a fan on Facebook. Math must consider the lifetime value of a fan, not just the first month.

  • jaybaer

    @IsaacAWardell Potentially, but these are already customers who signed up. Is there LTV that much higher because they clicked “like”?

    • IsaacAWardell

      @jaybaer I would argue that from a top of mind awareness standpoint, potentially so. Seeing something in my feed might put me in the mood.

  • ann_donnelly

    Great post! Too many companies ( and less savvy marketing/pr consultants ) don’t look closely enough ad2 the real ROI. They get hyped up over the numbers and a PR opportunity. At least this campaign was kinda targeted, many campaigns just throw a wide net, getting loads of likes that are only intetested in the freebie and not the core product/service.

    Also this was a one-off, hopefully they invest as much in converting these fans to customers and brand ambassadors, and more important, their long term day in day out Facebook strategy.

  • Another JB

    “Continuing to embrace that is to snuggle up to the false prophet of fuzzy social media math.” Well said! Really interesting post, Jay. And according to derekmcclain, the campaign may have attracted more DISlikes than likes!