Do you know
the marketing
method called “fan marketing”? Fan marketing is attracting attention as a way to increase the number of fans who are attached to a company, product, or service and lead to stable management.
If you can steadily increase the number of fans, you will be able to steadily expand your business even in today’s world where information and the environment change rapidly.
In this article, we will explain the basic knowledge of fan marketing, the benefits of using it, and the key points for successful fan marketing. Please take advantage of fan marketing to expand your business.
What is fan marketing?
Fan marketing is a marketing method that aims to increase sales over the medium to long term by increasing the number of enthusiastic “fans” for a company, product, or service.
Before explaining why it is important to create fans, I will first explain what kind of existence a fan is. In the business world, a fan is someone who passionately loves and trusts a company, empathizing with the company’s worldview and the founder’s values and thoughts. The easiest fan to imagine would be an Apple fan.
You may remember paying attention to the announcements of iPhone, iPad, MacBook, etc. released by Apple every year, and lining up at stores on the day of release. It’s not that it’s particularly evolved from last year, nor is it cheaper than its competitors, but Apple fans always line up at stores every year.
In this way, customers who behave in such a way that they do not easily switch to other products or services are called fans. And the reason why creating fans leads to big sales is deeply related to the “Pareto Principle.”
The Pareto principle, also known as the 2:8 rule, states that 80% of a company’s sales come from 20% of its customers. For this reason, companies often come up with measures to value the 20% of fans who return.
Fan marketing is a marketing method that aims to make the 20% of fans even more enthusiastic and increase the number of fans.
The importance of fan marketing
After the spread of the Internet, fan marketing gradually became popular as a business strategy. Fan marketing has been attracting attention in recent years, and its importance is increasing.
I will explain why it is called “fan marketing” now.
Spread of the Internet
With the spread of the Internet, customers (consumers) can now search for the products and services that best suit them. You can now view all the information published on the Internet and compare it with your competitors.
In other words, it has become difficult for people to pick up the products and services of companies that they are not interested in or are not fans of. Against this backdrop, fan marketing to acquire fans has become more important.
Current situation where it is difficult to acquire new customers
Due to the above-mentioned historical background, acquiring new customers has become even more difficult.
In marketing, the 1:5 rule, which states that it costs five times as much to acquire a new customer as it costs an existing customer, has long been recognized, but the current market environment has become even more severe. I am.
Against this market background, there is an increasing need to increase the number of repeat customers and existing customers as much as possible through fan marketing.
Shift to LTV acquisition
Furthermore, due to the historical background and shrinking market size mentioned above, companies are gradually starting to shift their focus from cultivating new customers to acquiring loyal customers with high
LTV
(Life Time Value).
In other words, they are shifting to a marketing strategy that focuses on “how long can you keep people buying your products and services?” The important marketing strategy here is “fan marketing.”
The era in which products could be sold by mass advertising and releasing new products to people of all ages and genders, as was the case after the period of high economic growth, has already come to an end. Nowadays, customers are able to search for the products and services that are best suited for them, so it is necessary to focus on acquiring loyal customers who will choose your company’s products and services themselves and will continue to purchase them for a long time.
Fan marketing methods
Here are five main methods of fan marketing.
fan meeting
A fan meeting is a networking event held by celebrities, idols, and other celebrities as part of their fan service, and is held by companies for specific customers such as loyal customers.
Customers who love your company’s products and services are often interested in the developers who developed those products and services, as well as the lineup of employees involved. By inviting these fans to fan meetings and creating special opportunities, we encourage them to become even more attached to our company.
fan community
One way is to provide a place for a fan community about your product, service, or company. A fan community is a place where fans can interact with each other and gather passionate supporters of a product, service, or company.
Basically, it is a place where fans can interact and exchange opinions with each other without the actual person being involved. While fan meetings are primarily a place for companies and fans to interact, fan communities are a place for fans to interact.
fan base marketing
Fan-based marketing is a marketing method that views customers and followers not just as buyers or users, but as passionate supporters and fans. We not only provide products and services based on customer needs, but also emphasize relationships with customers. Rather than just a one-time purchase or contract usage, we build a sustainable relationship with customers and increase the value of our products by making them repeat customers.We actively recommend and advertise not just a relationship with the customer, but customers themselves as supporters of the brand or company. Build relationships with customers that engage in activities.
Interaction on SNS
It is also effective to communicate on SNS such as Twitter, Instagram, and Facebook. With SNS, you don’t have to feel nervous about meeting face-to-face, so fans can easily interact with you.
By responding politely to the fans who approach you in this way, you will feel closer to them and they will become more interested in you. Additionally, during our interactions, we may ask you questions, doubts, or requests regarding products or services.
SNS does not cost much, so it can be said to be a method with excellent cost performance.
Subscription type service
Inviting fans to a subscription-type service and surrounding them is one method of fan marketing.
By offering special services and limited products that are only available to fans who have become members, fans can feel that they are getting a sense of value and benefits. Furthermore, by offering preferential treatment to members only, you can create a corporate branding effect and deepen your loyalty to the company.
Monitor experience
Having people participate in the monitor experience is also recommended as a form of fan marketing.
We send products to target customers so they can actually use them, or we invite them to our stores to receive services. By actually experiencing it, we aim to deepen awareness and understanding and turn them into fans.
By doing so, it will be easier to spread the word of mouth, etc., and it will also lead to posting and spreading on SNS.
Benefits of fan marketing
Here are four benefits of actually using fan marketing. Let’s understand it thoroughly and apply it to our own management.
Stable sales base
One of the benefits of fan marketing is that it can create a stable sales base. This is because 80% of a company’s sales come from 20% of its enthusiastic fans.
In addition, because fans are not easily distracted by other products, stable sales can be recorded over the medium to long term. Another attractive feature of fan marketing is that it can generate stable sales even in mature markets.
Generally, in mature markets, there are no major differences between competitors in terms of quality and functionality of products and services, and customers ultimately make purchasing decisions based on price. As a result, mature companies tend to see lower product prices and shrinking profits.
However, even in mature markets, companies with many fans who buy their products and services because they trust the company, even at high prices, can earn high profits even in mature markets.
As mentioned in the previous section, Apple in the mobile phone market is a good example. The market is already mature and there is no big difference in performance between models, so there is a lot of price competition.
In fact, there are some cheap smartphones that can be purchased for less than 50,000 yen, but Apple still sells iPhones that cost around 100,000 yen, and the most expensive product is nearly 150,000 yen. However, we are earning high profits thanks to the power of people who value Apple products.
Cases like this demonstrate that fans are an important entity that generates stable profits for companies. Conversely, you should understand that neglecting your fans is the same as giving up 80% of your sales.
Acquire new customers from good reviews
If you are good at fan marketing, you will generate good word of mouth, and if you generate good word of mouth, you will be able to smoothly acquire new customers. It is generally said that acquiring a new customer costs five times as much time and money as retaining an existing customer.
Every business owner thinks that they don’t want to spend too much in order to run their business smoothly, but if you want to increase sales significantly, you can’t avoid paying 5 times the cost of a new customer. There is a sense of frustration that there is no such thing. Therefore, quality word of mouth is a way to smoothly acquire new customers.
For example, if you are looking for a delicious ramen restaurant, you would typically search for a ramen restaurant with high reviews on websites such as Tabelog. However, if a friend talks passionately about their favorite ramen shop and recommends it, you’ll probably decide to visit that ramen shop at least once.
In this way, high-quality word-of-mouth comments from friends can invite other friends to visit your store, leading to the acquisition of new customers.
Advertising cost reduction effect
Utilizing fan marketing can also help reduce advertising costs. It’s great to be able to reduce advertising costs when running a company.
Generally, customers who become fans want people to know about the product or service they are passionate about, so they start advertising it. Advertising on SNS and product reviews have great power in promoting this.
Impressions from people who have actually experienced your product or service are more effective than promoting your own products. Fan advertising helps establish a company’s brand image, which in turn leads to a reduction in advertising costs.
As an example, Starbucks, the industry’s largest coffee chain, has been conscious of creating products and spaces that fans want to promote, which has led to fans posting on social media.
As a result, we have grown into a major global company without spending on advertising such as commercials, and thanks to our fans, we have a solid position that is second to none.
good feedback
When your customers become fans, you receive quality feedback. Customers who become fans want the products and services they use to be more convenient and comfortable than those of competitors, so they will tell you specifically what they would like to see improved.
Not only can you get specific feedback from a user’s perspective, but if your customers are fans, they will voluntarily tell you about it, so you can get feedback at zero cost.
Normally, this kind of high-quality feedback is often investigated using discounts on products and services or funds, so this is a huge benefit.
Disadvantages of fan marketing
Although fan marketing has great benefits, there are also some caveats when using it. Let’s take advantage of fan marketing after understanding the precautions.
Need to take time to form
Another thing to keep in mind when it comes to fan marketing is the amount of time it takes to create fans. Fan marketing is not so easy that you can make a profit right away; rather, a story is created over time, and customers become fans as they empathize with that story.
At first glance, the time it takes to create fans is a point of caution, but if you look at it from a different perspective, it actually becomes a high barrier to entry, and not everyone can do it, so building it will become a major point of differentiation.
There is a risk of fire
Fan marketing is a method of communicating closer to customers than general marketing methods. Therefore, they become more interested in information that reveals the true intentions and personality of the people who work for a company, rather than information in company announcements.
Information such as the true feelings of people in a company is more likely to be mixed with the thoughts and feelings of individuals than the information disseminated through announcements, so there is a risk of an unpredictable incident. Even if it is unintentional, it may cause backlash.
Therefore, in the event of an uproar or backlash, the company should think about how to deal with it in order to avoid disappointing the fans.
Key points for successful fan marketing
Finally, I would like to introduce four key points to successful fan marketing. A company’s sales and growth rate will vary greatly depending on whether or not it has the key points for success, so be sure to check carefully.
Define a fan
Before doing fan marketing, it is important to clarify the definition of a fan. The definition of a fan differs depending on the company, but it can be defined as someone who sympathizes with the company’s worldview and the values of its founder, and who makes great use of its products and services.
Therefore, we will introduce a more precise way to define a fan. To specifically define a fan, it is necessary to consider two axes: “purchase data” and “emotional data.”
Purchase data is data on how much money people actually spend, and sentiment data is data on how much love and trust they have toward a company.
When measuring each type of data, purchase data can be understood to some extent from sales figures, and emotional data can be determined using an index called NPS. NPS is called “Net Promoter Score,” and it is data that defines “the degree of attachment and trust a company or brand has” as a numerical value, which has been difficult to measure until now.
Why not think about the definition of a fan by using this data to understand it quantitatively, without relying on intuition, from two aspects: purchase data and emotional data.
Conducting close communication with fans
For fan marketing to be successful, close communication with fans is extremely important.
There are many companies that actually engage in fan marketing, so the key is to aim for differentiation through the density of communication. For example, you can use your company’s products and services to respond to people who post on SNS with likes, or respond to comments from your followers.
Create an environment for communication between fans
It is also important to set up community sites and fan meetings where fans can connect with each other. By actually interacting with fans, you can prevent brand switching to competitors.
In addition, companies can easily create points of contact with fans, and companies can also get new ideas from conversations with fans, so be conscious of actively creating opportunities for interaction. Let’s try it.
Execution of projects that fans are interested in
In order for your fans to stay as fans, you need to create projects that entertain and excite customers who are fans.
Therefore, think about it separately from activities that turn non-fans into fans, and keep in mind that this is a project aimed at people who are already fans. For example, typical exciting projects include product/service testers and giving away non-sale items to the first few people.
Fan marketing success story
We will introduce examples of companies that have succeeded by introducing fan marketing.
kagome
In 2015, Kagome launched the membership-based community site “&KAGOME” in order to gain enthusiastic fans for its products.
Mr. Mizuno, who was the manager of the advertising group in the advertising department at the time, said, “We established the center not only to disseminate information and advertise products, but also to connect firmly with our customers.”
In fact, the site has a bulletin board where customers can casually chat with each other, and a system that allows other customers to comment on content posted by customers, allowing the site to be managed with the involvement of customers. can be confirmed.
In 2020, the number of members exceeded approximately 30,000, making it a success story in fan marketing.
starbucks
Starbucks Coffee, which has been successful in increasing
engagement
with its inner branding strategy, has also achieved success in fan marketing.
Starbucks, which is now on a global scale, surprisingly spends almost no money on mass advertising and continues to increase its fan base mainly through fan marketing using SNS.
Branding was carried out on SNS based on the store experience, and word of mouth was spread from SNS users who sympathized with the activities to other users, and the company now has touch points of over 15 million people through fan marketing alone.
Furthermore, we are actively disseminating information by launching a new owned media, “Starbucks Stories Japan.”
AWS
AWS stands for “Amazon Web Services” and is a
cloud-
based
platform
provided by Amazon. AWS has also successfully acquired fans through fan marketing.
With the recent diversification of customer
needs
, AWS knew that the vendor’s own self-congratulations would not resonate with customers. Therefore, in order to gain fans, we believe that we must have people who actually use AWS and like it recommend it, so we have developed a strategy to create a community of people who are already fans of AWS. Ta.
Unlike influencers, we do not require compensation such as money or compensation, and by providing an environment where true fans who know the benefits of AWS can actively disseminate information, this has led to the expansion of the community. , and was successful in acquiring new fans.
summary
In this article, we have explained the basic knowledge of fan marketing, the benefits of using it, and the key points for successful fan marketing.
Fan marketing is a marketing method that creates fans and grows your business through the power of fans. By increasing the number of fans who are attached to your company, products, and services, you can lead to stable management.
This is a recommended marketing method for companies that want to further increase sales and maintain stable business management. Please try using it for your own business.