Virtrue made headlines a few months ago by trying to associate a dollar value with a social relationship. Here’s an obvious flaw: the quantification of a human relationship. Ask yourself – what is the dollar value of your network, your best friend? (Tough to answer? Dumb question.)
Allow me to quickly poke three other gaping holes in this theory:
- It assumes that the value of an earned media impression is the same as a paid media impression ($5.00CPM). This recent study by Nielsen demonstrates that earned media impressions are clearly more valuable that paid impressions:
- It only addresses the 12-month value of the fan. More value can be associated with a fan over a “lifetime.” Some examples: value of insights, value of ideas, value of referrals, size of their networks. Charlene Li‘s approach works much better:
- The formula assumes that the brand is going to make two posts/day. Many brands are posting/communicating A LOT more and have a lot of commentary (positive sentiment) as a result.
What do you think? Want to poke another hole, or perhaps plug up one of mine?
