Creating equity value through online employee advocacy

Companies are being won over by employee advocacy, the latest trend in social media, as the potential for employees to add equity and shareholder value becomes apparent.

David Carratt
November 24, 2014 - 3 min. read

Employee advocacy offers a wide range of benefits and can increase equity value by making marketing more effective, reducing employment costs and improving customer satisfaction.


Advocacy programs encourage employees to take part in company communications, by enabling them to share marketing content and opinions with their own social media networks. This increases brand awareness by extending the distribution of paid, owned and earned media. According to the Pew Research Center, adult Facebook users have an average of 338 friends, so the potential reach for large organizations with thousands of employees is huge.


If employees feel their opinions as advocates are valued they will be more engaged and this could bring improvements in productivity. A Hay Group study, Giving everyone the chance to shine, found companies with highly engaged workers grew revenues two and a half times as much as those with low engagement levels. They also cut staff turnover by up to 40%.

Research shows that people who work for inspiring leaders are more committed and less likely to leave their jobs. Employee advocacy programs allow middle management, not just the CEO, to become thought leaders on industry topics and to motivate others.


There is also a clear link between employee satisfaction and customer satisfaction. The Service-Profit Chain theory by researchers at Harvard Business School found that profit and growth are driven by customer loyalty, which is a result of customer satisfaction. Customer satisfaction is influenced by the value of services, which is created by satisfied, loyal and productive employees.

Employee advocates can significantly improve customer experience because the information they provide is trusted more than advertising and marketing content. Employees can also answer customer questions informally and solve problems faster and more cost effectively than customer service representatives at a call center.


We know satisfied customers stay longer and spend more, and as employee advocacy goes digital this can be tracked. Employee advocates should have key performance indicators, so their efforts can be compared with other marketing activity and their achievements communicated. Success metrics could include how many people received a post, how many shared the information, how many responded to calls-to-action such as click-through, lead and conversion rates, what they bought and how much they spent.

While it’s early days for measuring the monetary value of employee advocacy, companies are already calculating this from a marketing standpoint by monitoring things like the web traffic generated by employee advocates, the costs of leads and resulting conversion rates. With more detailed analysis, it’s possible to estimate the overall business value.


Falcon Social’s latest mobile app, Inspire, lets companies quickly and easily set up employee advocacy programs by enabling employees to share branded content to social networks using their mobile phones.

It also allows organizations to measure employee activity across social media and gain insights on reach and engagement. The ability to measure the success of employee advocacy programs is essential, as businesses will want to see its impact on revenues and costs.

Employee advocacy

Falcon Social measures the performance of its employee advocacy program and has found that individuals have a media value of about $18,000 per year, assuming they post something weekly. A recent post from one of our team generated 332 visits to our website in just three hours. Of the visitors, 75% were new to Falcon’s website and 187 downloaded the handbook How to Create a Social Content Strategy for your Business. This type of exposure would cost thousands of dollars in bought media.


Imagine if this is scaled for a large Consumer Packaged Goods (CPG) company with thousands of employees. For example, Unilever has 174,000 employees and if only 5% of its workforce became employee advocates the media value could be more than $150m (25% of Unilever’s current advertising and promotional spend). If you replaced this external media spend with employee advocacy the impact on Unilever’s equity value could be $2.4bn ($150m x Unilever’s price earnings ratio of 16).

With vast amounts of money at stake, large CPGs will be looking to include employee advocacy as part of their overall digital strategy. Forward looking brands will provide guidance, training and technology to make the process of becoming online company advocates easy for employees. They will also reward those who are active online.

Employee advocates can add significant equity and shareholder value and investors are beginning to recognize online advocacy programs as a sign of effective leadership and company strength.



How to inspire employee advocacy
