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Posts Tagged ‘ROI’

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The Importance of Defining Social Media Success

Man, if I had a nickle for every tweet, comment and blog posts about social media ROI, I’d be….Well, you get the picture.

Don’t get me wrong, ROI is important because it’s part of social media’s evolution from a corporate novelty to a key strategic and tactic asset. But part of the challenge in attempting to define ROI is the metrics are hard and soft – everything from Web site traffic and click-throughs to better customer service and a higher profile brand.

Some you can easily measure, and some are abstract but just as valuable.

So, what do you do?

Perhaps a small step forward on the path to an ROI that satisfies the corporate bean-counters is defining what success looks like. For some companies, “success” is better customer service or having as strong a social media presence as the competition.

For other companies, success is simply higher sales. However success is defined, it’s how companies begin to get a handle on their social media investments.

Even the most basic metrics (e.g. establish a social media foothold) are a way to do some kind of assessment. In time, corporate metrics can become more complex and sophisticated but everything needs a starting point – even social media ROI.

By Mark Evans - March 23rd, 2010 - 1 Comment »
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Posted in Social Media

Forget ROI, Let’s Focus on Social Media Optimization

As more companies embrace social media, the chatter about return on investment, or ROI, has amplified as executives attempt to determine whether the money they’re spending is worth it. In theory, it’s a good exercise but given it is still early days for social media, it is a challenge to accurately quantity its impact right now.

Rather than focus on ROI, companies should be looking long and hard at SMO – social media optimization.

So, what is SMO? One way to define is that SMO is a focus on making sure that a company’s social media activities are as efficient and effective as possible. It means creating content – be it blog posts, tweets, videos or Facebook updates – that can be easily used and leveraged across multiple social media platforms.

It means making sure a company’s social media person or team is highly productive so that their day-day-day activities are focused and productive as opposed to having a scattered shot-gun approach that consumes too many cycles.

One of the best ways to jump-start SMO is taking advantage of the wide variety of tools that can automate social media activity and extend the reach of your content with no or little manual effort.

For example, TwitterFeed is a easy way to link an RSS feed to Twitter so that every time you have a new blog post, it automatically creates tweet.

Ping.fm is another excellent tool to quickly content to distribute updates to dozens of social media platforms – everything from Twitter and Facebook to LinkedIn, Flickr, Friendfeed, MySpace and Ning.

Hootsuite is a Twitter publishing tool with lots of great features, including the ability to schedule tweets, which means you can create a bunch of tweets at one time, and then have them appear throughout the day.

The underlying theme is using tools to make social media work for you as opposed to working social media. This is not to suggest that social media doesn’t require a consistent and sustained effort but there are lot of ways to optimize how you use social media.

So, let’s have more discussions about SMO to complement the growing obsession with ROI.

For another take on SMO, check out Oren Todoros’ post on “Max Your Brand With 4 Social Media Optimization Tips”.

By Mark Evans - February 25th, 2010 - 5 Comments »
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Posted in Social Media

How to Measure Defensive Social Media?

measureEarlier this month, we did a post looking at defensive social media – the “un-sexy” activity that deals with crisis management, customer service, unhappy customers, upset investors, disgruntled employees, and media coverage.

An important component that wasn’t covered in the original post was how to measure the effectiveness of defensive social media. Given the current obsession with ROI, it would be remiss to ignore the defensive side of the equation.

So, how do you measure defensive ROI. For example, how would you measure whether social media is helping with customer service? Would it simply be a matter of seeing less negative conversations within the social media landscape?

What about the value of getting feedback and suggestions? Is it just a matter of adding up the amount of feedback and suggestions that coming poring in?

What about crisis management? Would it be measured by how quickly a crisis could be resolved or addressed?

I suspect that defensive ROI is probably less of a priority than offensive ROI such as higher sales, more leads and more Web site traffic. Nevertheless, defense is as important as offense so developing ways to measure ROI is going to be important.

By Mark Evans - January 21st, 2010 - 1 Comment »
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Posted in Social Media

Is Social Media for You?

For all the talk about social media, many companies are jumping on the bandwagon without really thinking through whether the investment in time, resources and money is a good move.

By that, I mean it’s important to ask some basic but, nevertheless, critical questions:

1. Why does your company want to embrace social media? Is it because social media offers a new way to build relationships with consumers and, hopefully, drive higher sales? Is the move motivated by the fact social media just sounds sexy so it’s something that needs to be implemented? Or is it because the competition is using it?

2. What are your goals, and how will social media help you achieve them? Is it higher sales? Will it help with customer service? Will it enhance the brand and the company’s competitiveness? Will it provide valuable feedback and product development intelligence?

3. Who’s going to run the day-to-day social media operations. Launching social media tools is pretty straightforward; the hard part is consistently working them to get the targeted results. Truth be told, social media success rarely happens overnight; it’s a game of inches as opposed to miles. That means it can take time to see tangible signs of progress and success.

4. What does success look like, and how are you going to measure it?

5. How will social media get baked into your corporate culture? Social media needs to be embraced and tightly integrated into a company’s operations. It may be the belle of the ball right now but without dance partners, social media is going to stand on the sidelines doing nothing but looking pretty.

For some more good insight on social media, check out this Q&A with consultant Oliver Blanchard.

By Mark Evans - January 13th, 2010 - 1 Comment »
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Posted in Social Media

The Importance of Social Media Defense

Amid all the chatter recently about ROI, one of the major themes is how the paramount goal for social media is driving more sales. It’s an idea based on the belief that if more revenue ain’t coming in the door, then it’s difficult to justify making a major investment in social media.

There are a few holes in this theory. First, social media is just one element of a company’s marketing/sales mix so putting the spotlight on social media without also scrutinizing other marketing and sales activity efforts is a mistake. Second, the focus on driving sales has much to do with the offensive side of social media but it deflects attention away from the important defensive role played by social media.

Say what? The defensive side of social media?

It’s not particularly sexy but social media is a crucial tool that helps companies deal with crisis issues, customer service, bad products, unhappy customers, upset investors and disgruntled employees. By participating in the social media ecosystem, companies can quickly discover and pro-actively deal with issues before they become major problems. In many cases, problems can turn into positive situations if a company responds in the right way.

But how do you measure the social media ROI for defense as opposed to offense? It is possible to measure the happiness of customers, employees and investors who have been engaged using social media? It’s clearly a much more challenge difficult to measure than sales but, arguably, it’s just as important.

In many respects, social media is like sports in which a good defense plays a key role in creating a good offense. It’s important to remember that social media isn’t all glitz and glam; there’s a lot of grunt work happening behind the scenes that’s defensive rather than offensive.

For more thoughts about social media ROI, check out this post by ReadWriteWeb.

By Mark Evans - January 7th, 2010 - 3 Comments »
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Posted in Social Media

Pay Attention to Your Social Media Goals

As companies spend more time embracing social media, there’s a lot of focus on strategic and tactics – what services should be used, who should manage them, and what’s the return on investment.

Another important issue that shouldn’t be overlooked is establishing social media goals so the time, energy and money invested on social media can be deemed to be successful or not. Without pre-established benchmarks, it’s difficult, if not impossible, to get a handle on whether the desired goals and objectives have been achieved, and whether strategic or tactical changes should be made.

The challenge is defining your social media goals given that companies may have different targets. These goals can include higher sales, a stronger brand, happier customers, better customer service, increased Web site traffic, lots of followers on Facebook and Twitter, and improved search engine optimization. Companies need to select the most important goals, and then track them.

This may seem like a straightforward exercise with some pretty obvious metrics but, nevertheless, goals are a crucial part of a social media program. To ignore goals would be a terrible mistake.

By Mark Evans - January 6th, 2010 - No Comments »
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Posted in Social Media

There’s No ROI on Social Media

ROI

First, a confession. The headline is designed to capture your attention so I’m guilty as charged for suggesting an idea that many people may find preposterous.

In fact, the headline isn’t true or accurate but it does play on the raging debate happening over whether there is return on investment (ROI) from social media activity, and how ROI is or can be measured.

This discussion isn’t surprising because new ways that companies spend money should be analyzed and measured, otherwise there is difficult to know whether it’s money well spent, or money that should be spent on other things.

The challenge when it comes to measuring social media ROI is it’s still early days for social media. As a result, there is a lot of experimenting (and spending) by companies that want to get experience and insight into what works and what doesn’t. At the same time, they are trying to create ROI models that can be used for measurement purposes.

A good example is The Gap, which recently launched a new campaign, “Born to Fit” that features the extensive use of online ads and social media, in particular a Facebook Page.

In a blog post, Jacob Morgan included this intriguing quote from Julie Channing, senior account director for AKQA, the agency handling The Gap’s campaign:


“The Gap had set no numerical benchmarks to determine success in the campaign, but rather would look at how much consumers interact with the brand to gauge ROI.”

Morgan contends the problem is that without benchmarks, it’s difficult to “measure ANY type of success, let alone ROI”. Morgan makes a good point because how is consumer interaction with a brand measured? He also questions how AKQA will be able to explain to its client how well the campaign did without defined metrics.

For anyone focused on social media ROI, The Gap’s approach may be frustrating and, perhaps, disappointing given The Gap is a major advertiser defining how it operates within the emerging social media landscape. At the same time, it also shows that social media ROI is still work in progress, and that the “rules” have yet to be established.

Of course, it should also be pointed out that marketing within social media is a different creature than traditional media.

In social media, there are well-defined metrics that can be used to track ROI such as Web site traffic, click- throughs, and higher sales. At the same time, social feature features “soft” metrics that are more difficult to measure: better customer service, engagement, interaction, a stronger brand and more loyal customers.

The focus (obsession?) with social media ROI is healthy and much-needed because it’s part of the process in which social media will become a viable option for many marketers and advertisers. The more attention paid to ROI, the faster, in theory, the parameters will be defined and established.

What do you think? Are there ways to effectively measure social media ROI right now, or it is still work in progress?

More: Jacob Morgan has been spending a lot of time focused on social media ROI: here’s a collection of recent posts he’s done.

By Mark Evans - September 21st, 2009 - 7 Comments »
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Posted in Social Media

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