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On 4 Neat Ways to Prove Social ROI & 4 Unforgettable Stats

Hi Katie,

hopefully my response to Rob covers some of your feedback. Of course the 'I' needs to be calculated but certainly in the cases I have worked on, it can be covered in initial business case and needs to balance favourably with predicted return.

I totally agree with you on the flexibility of the 'R" - it's 100% part of the new emerging models to justify social for business. In many cases as you have illustrated this return extends to business efficiancy and not just marketing/sales return.

cheers

Nick

On 4 Neat Ways to Prove Social ROI & 4 Unforgettable Stats

@Rob Clark.

Hello Rob, thanks again for your detailed response. A very interesting read. Above all I I loved your turnips to Poughkeepsie example... Had me chuckling away. I completely understand where you are coming from on all points. And it just proves what a turbulent topic ROI is becoming. In fact you yourself have summed up my response to your comments brilliantly...

"The goals and business objectives of a social campaign are going to vary tremendously from one another... Different goals means different reporting is called for...."

Also let's add to that… The business models are going to vary tremendously too, not all will have an ecommerce channel - so hard and fast/tried and tested ROI calculations that you are referring to are not an option. Further more the value of a conversation can often not be tracked to the till. Should we just accept this and halt the conversation?

As I mentioned at the top of my article, I was not concentrating in this post on direct and measurable ROI tracking. That is a simple matter of plugging in the correct analytics package and hey presto - we know, pound for pound, our turnip return in Poughkeepsie ;)

I predict that we will all become far more flexible on the 'R' of ROI, particularly with social media and the absence of direct trace of sale. This movement will require more flexible ways of measurement. Just to clarify the flexible 'R' points behind my examples...

MEV - Media Equivalent Value. It's justification to move budget from expensive media impressions into growing your base - far cheaper = saving = Return.

Data value - hugely important as it represents CLV customer lifetime value. When you know your email base returns a % demand per annum, then predicting growth targets based on a known %conversion is sound... = more sales per year = Return.

IOI - as stated is an 'indication of intent' - without direct tracking to sales, this is far better than just shrugging and saying it can't be measured accurately. Some knowledge is better than none = Return.

KPI - I think you will find these have long been a measure of brand campaign success. Return is not just money in the till. But the change in perception and raising of awareness that 'MUST' come before a purchase. Nowadays that happens in social media 78% of people believe each other, only 13% believe adverts. Conversations lead to sales = Return.

For instance rather than delivering a single crate of turnips and proving a direct financial return. I might engage 'The world leading turnip expert' - to talk about my unique brand of Turnip to a tuned in audience of 100,000s of Turnip wholesalers world wide. This approach through advocacy marketing is not always something we can gain a direct trace of sale. But I know which return I would be after.

In fact Audi ran a recent social campaign through Klout, searching for the 200 most influential 'Audiphiles' and engaging them around the A8 launch, the campaign generated 12000 #ProgressIs tweets. A ground swell of influence led conversation throughout the relevant automotive audience. 

When asked about ROI, Doug Clark, Audi America's general manager for social media was quoted to say  "Today the equation to measure that doesn't exist… (Facebook and Twitter) are places where we know tech-minded consumers are active, where they're seeking to engage with the brand. But can I say that a fan is more likely to buy an Audi? No."

So far from being 'convoluted twists' I think you will find that my examples are starting points for modern models to justify commercial socialising - not the old world of ROI marketing. Without the emergence of modern models and attempts to demonstrate the wider 'R' in return - we will all be sitting on our hands saying - let's just do some PPC.

But thanks again Rob, I know it will always be a split camp and will not be solved with our debate. But I appreciate the detailed response and certainly enjoyed reading your creative illustrations.

All the best
Nick

On 4 Neat Ways to Prove Social ROI & 4 Unforgettable Stats

Hey Kavya, glad it was useful. Thanks for your feedback.

Cheers

Nick

On 4 Neat Ways to Prove Social ROI & 4 Unforgettable Stats

Thanks for your comment Karolis, I certainly hope we can all start to prove more value and set established benchmarks too.

Revenue per fan is an interesting one, I know that Starbucks was quite an interesting case, they used the Media Equivalent Value, to attribute a value per fan. By calculating the overall equivalent media cost of all the impression delivered over a year through Facebook, calculating a CPM and then dividing by the number of fans. They ended up with a $3 - $5 per fan figure.

Campalyst looks interesting, totally agree if you can link in with G.Analytics or any site tracking and you have an e-commerce offering, it's a win and should be implemented straight away.

But its much more challenging with sites that don't have direct e-commerce offerings. So tracking to agreed values of traffic, referral, data capture and engagement become the value measurements.

Cheers

Nick

On 4 Neat Ways to Prove Social ROI & 4 Unforgettable Stats

Thanks Dan, it's a good point, budget and resource can be an issue. But as you said on your site, there is no one size fits all for many things in social strategy. It's about looking at the individual case and working with them as a partner to see, what they actually value as 'RETURN' and then what is achievable in budget/resource.

That's partly why I have offered some quite varied approaches. Data Value would be a good starting point for small businesses. Initial work to ascertain a value for data capture in each channel, perhaps with email being at the top of the scale. Then monitoring the data capture numbers is not labour intensive and should be an easy monthly report on return. Of course that needs to be run along side a strategy that aims to engage and convert conversations, up the data collection value toward email and ultimately sales.

Be good to chat more, will drop you a DM.

Cheers

Nick

On Social Media 101 for Smartie Pants (Yes, That Includes You)

Ha ha... good post Pam. That had me chuckling. 

They like.

They circle.

They follow.

They laugh.

They friend.

They share.

= Social media understood. Next topic.. Cheers Nick

On Google+ May Be the Biggest Online Conversation in the History of the Internet

Interesting point Milli,

It's certainly going to be an interesting next 6 months with G+. You are so right, with the insight into business use of G+. At the moment of course the big focus is personal networking and it's all about audience take up. But as soon as the number stack up, every marketing department/brand will be looking for 'The way..' to integrate G+, just as it played out on Facebook.

Cheers
Nick

On Agile Social Marketing: Engage + Learn Fast

Hi Rohn,
great article. I have been on a similar mission too, all our development projects work to the agile methodology and I've been so impressed with the results. It's not just a leaner process, but it's more liberating, no one feels tied down and restricted.

So I've been trying to pull in some of the key tenants into marketing approaches over the last couple of years. Of course it won't work in every case and it won't suit every client. But it is proving very effective in certain projects either wholesale or piecemeal. Totally agree on your research point too. Focus groups, put people into environments that make them behave differently, so I am always a little sceptical. 'Live working research, through action and engagement'... now there is a thing.

The change is coming and for me what has been illuminated is the change in mindset that comes with working with a more agile method. It redefines change and mistake and as long as you have a small test/rollout structure, you actually have a certain degree of 'insurance'.

I bid the old sign off proceess in marketing a farewell. Change is good. Agile is better.

Cheers
Nick

 

On Five Reasons the Facebook IPO is Troubling

Thanks Adam,

That was an interesting read. I'm inclined to agree and feel a little cynical about the IPO. Has Facebook reached it's peak in terms of audience engagement and growth trends? (Makes for a good time to float)

Probably and certainly a combination of the factors you mentioned. Not so sure on the privacy side as I often find these issues to be a lot of smoke and very little fire. The privacy fire starters do make a lot of noise and we all love to hear a good scandal.

That said, nothing is going to happen any time soon that will disturb an institution that big, it will still be the hottest tech IPO in history and the trend for growth may be showing some decline, it's an audience size that will be of mega value for many years to come and for the majority, change is too uncomfortable and too much bother.

So I feel a little cynical, I'm less troubled and in fact, more excited about the new and alternative players on the social scene. Like Connect.me, Instagram, Color, Meetup and many others.

Bring on the competition.
Cheers
Nick

On The Human Influence in Social Media

Well said Michael,

I particularly like the way your phrased... 'Social media is not capable of building your marketing strategy. Only you are capable of that.'

Social media is no silver bullet. While it can be a responsive and effective part of the marketing mix, as you have rightly pointed out, it is a set of tools/channels.

What I would add, is that social media has been a huge catalyst in making all businesses and marketers change the way they interact with consumers. All for the better. The shift in advertising from a broadcast approach to a participatory approach, has not been led by advertising or business. More so it's been led by the crowd, powered by social media channels. Brands and businesses the world over are now chasing their tails to keep up and benefit from this shift in crowd power.

It's not so much 'Social Media' it's more about being 'More Sociable' in any media.

Cheers
Nick

On Do You Know Your Facebook EdgeRank Score?

Nice article Ralph,

It's true that we are all bamboozled by No. of fans/followers/views. It's true in all social channels. In some cases, particularily YouTube the numbers often just show a high number of uninterested views. Logging comment sentiment and reactions can really help to get a better view of the real return on engagement. EdgeRank is undervalued and not counted half as often as it should be.

Cheers Nick

 

On STOP! It's Not "Social Media!" It's "Social Networks"

I like your point Rohn. In this context I totally agree. The media is defined by the connected nature of the people in it. So it's far more a network. It only becomes media from a commercial/business point of view. It's funny how semantics can actually make such a difference. As you say, senior management, or any of us for that matter, can latch onto a word and 'auto populate' the meaning. Thinking about it as a network of people, rather than a traditional 'media channel' is actually really important. Because you kick start your planning from a more respectful and useful starting point, as opposed to the more traditional - budget/reach broadcast mentality. Network 1 :: Media 0 Cheers Nick