Last month Facebook made an announcement that could dramatically alter the way brands engage their customers through this massively popular social channel.
The announcement reads as follows:
“You must not incentivize people to use social plug-ins or to like a Page. This includes offering rewards, or gating apps or app content based on whether or not a person has liked a Page. It remains acceptable to incentivize people to login to your app, checkin at a place, or enter a promotion on your app’s Page. To ensure quality connections and help businesses reach the people who matter to them, we want people to like Pages because they want to connect and hear from the business, not because of artificial incentives. We believe this update will benefit people and advertisers alike.”
Brands have until Nov. 5, 2014 to comply with this new Facebook rule change.
So just how much of an impact will this Facebook announcement have on brands and advertisers? CrowdTwist CEO Irving Fain sat down with Loyalty360 to discuss the potential ramifications.
What are the implications of the Facebook announcement for brands?
With this announcement, the onus has increased for brands to build a relationship with their customers to earn their social connections. You can’t buy loyalty. A Like on Facebook is akin to continuous patronage, and that only happens when people feel valued and important to a brand. Facebook is really trying to get brands to do it right—to offer valuable content and experiences to consumers versus enticing them to connect to a brand page based on an incentive alone.
How do you think Facebook’s announcement will impact the loyalty industry?
This announcement isn’t going to have a major impact overall because the loyalty industry in many ways is still focused on spend and get, transactional-only programs. Very few loyalty companies still concentrate on building true multichannel initiatives and incorporating social media into their loyalty strategies. That said, removing incentives for a Facebook “Like” will impact the myriad of players who are trying to dip their toes in social, but haven’t developed a depth or true competency in expanding beyond spend channels. For many companies, “social” has meant simply gating content, offers, rewards, etc. behind the Like of a Facebook page. With this announcement, that’s no longer a viable strategy for brands. This is a good thing for everyone involved.
Ultimately, the removal of Like-gating will force many loyalty companies to develop strategies and technologies around the social channels that drive a deeper connection to their customers and provide greater utility from the data that they are collecting. Facebook is telling marketers that liking a page is an important step in a customer relationship with that brand and it’s one that should not be taken lightly. The Like needs to be truly earned.
In what way will this change affect CrowdTwist?
This change doesn’t have much effect on CrowdTwist because for a long time we have been blending activities—some of which we measure, but don’t reward for (e.g., making comments on a Facebook post) to preserve the authenticity of an interaction and others that we explicitly reward (e.g., awarding points to customer who download an app). Just because a brand isn’t rewarding a particular interaction doesn’t mean that data can’t be collected and used to improve the customer experience. That has been our belief from the beginning and we aim to measure as much as possible regardless of whether a direct incentive is involved. The more you know about who a customer is, the stronger your foundation will be when you attempt to build a long-term relationship.
What are some other ways brands can incentivize customers?
The great thing about multichannel loyalty is there are an infinite number of ways to incentivize people for any type of interaction that is verifiable and trackable. For example, you can reward people for referrals, reviewing products, watching a video, updating their online profile, taking a survey, or checking in to locations via social media. There are so many things brands that are building effective multichannel loyalty strategies can still measure and reward to enhance a traditional spend-and-get loyalty program.
Does the change with Facebook create any new opportunities for CrowdTwist?
For CrowdTwist, the opportunity hasn’t changed. We are a leader in the multichannel loyalty and analytics space, and we are fortunate in that this change allows us to continue the business that we have already been building. The Facebook announcement verifies what we believe, which is that loyalty is about relationships, positive experiences, and genuine interaction with a brand no matter if that occurs in a store, on a mobile phone, online, or on a Facebook page. All of these channels have become critical sources of interaction and data for brands when are building long-term, loyal relationships with their customers.
Loyalty360 will host a webinar on Thursday, Sept. 18, 2014 at 1 p.m. EDT titled, “How UFC and Nestlé Purina Green Lighted Their Loyalty Programs,” which will be presented by CrowdTwist.