Seems like coming up with a value for social media has become a cottage industry, for example, $3.60 Facebook Fan Valuation Is Just the Tip of the Iceberg. These values are often derived from what is paid for online media. So you have to ask, if someone is basing the value of a Facebook fan on the value of impressions generated, what is the real value of those impressions? Because unless this is known, the whole framework is faulty.
Just because you pay $5 / CPM for impressions, does not mean they are worth $5 / CPM, does it? Do people really still have that kind of mentality? Is the price of the media equivalent to its value?
For example, I’m sure you have heard of multi-million dollar campaigns that generate very little lift in sales. Happens frequently in fast food, for example. What is the value of that media? Is it the millions paid?
What really blows my mind about this approach is it’s so offline, so old school PR. Do the folks who put forth these kinds of models believe nothing has changed in 50 years? What happened to the whole rap of online being “different”, that you can’t measure it like offline, blah blah.
Except when it’s convenient to do so?
If you want to know the value of a Facebook fan, why not measure the value of a Facebook fan? Because it’s hard, and would require organizational discipline? Too bad. Substituting the kind of models used in the example above for actually measuring the value of a Facebook fan is misleading at the very best.