It has become increasingly important for companies to determine the ROI of Social investment and one common question that decision makers ask is “how can we leverage digital channels to increase demand and revenue?” My understanding suggests that every company uses social media as a channel to push news and product messages BUT fail to deliver time sensitive and relevant information to consumers. As a result they struggle to drive demand from their social marketing efforts. So, my question is “Is your social initiative providing value to your organization?”
Executives in your organization, including product managers, sales leaders and CMOs should see social marketing programs on a strategic level rather than on a tactical level. The recent industry stats show that marketers are not always good at measuring the effectiveness of social media – They tend to fail because they focus on the metrics that are easily available instead of the metrics that best compliment to their business objectives they are opting for. For example: Marketers love to count things, like the number of twitter followers or entries for their user-generated contests, but the objective should be to encourage users to pass along your messages for you. I don’t say that such metrics are not valuable for their marketing objectives, but they are of secondary importance.
Don’t ignore the true effectiveness of your social effortsLet’s face this – It’s not surprising that marketers have tough times measuring social media initiatives, on top of it, every social platform and vendors offer its own metrics. As a result, there might be a several ways to measure the success of social initiatives. However, the following few points would help marketers identify simpler ways to track down measures.
- Consumer reach: helps identify how/where the messages are being spread.
- Volume of involvement: helps describe how many consumers interact with your social initiative.
- Quality of participation: helps describe the strength and depth of consumers’ interactions with your social initiatives.
- Volume and Quality of energy: help describe how many consumers talk about your company and products, along with the nature of positive opinions expressed to influence others.
C-level executives are excited about the potential of the channelWhile many CFOs and CIOs are eager to get involved with in day-to-day metrics, it is very important for marketers to show them data that will help them secure budget for social marketing programs and incorporate social agenda into their corporate strategies. For example, when Audi’s marketing team needed to prove the value of its “The next big social thing” program to executives, the team reported the number of preorders the program delivered – Simple sales tracking can help create this data for you, especially if you sell line or you can also survey buyers to find out if social played a role in the purchase cycle.
Believe me, it will be nice to report some financial data to executives on a quarterly basis with a specific focus to assist in budgeting. With handful of data, marketers will be able to defend the social programs and build social media into the organization’s regular budget.
Measuring your social efforts to track real-world successI would say marketers should begin their social initiatives by considering the consumers they are targeting and objectives they are willing to achieve, only then can they decide the best strategy and technology to support their efforts. As a marketer, your focus has to build your brand with the help of social programs, but you will also be the person responsible to showcase social metrics to the internal stakeholders.
As I mentioned in my previous post Investment linked to return – How to convince CFOs that digital is a wise investment? - Try balancing your focus on four perspectives and put the right tools/technology in place to measure the success of social programs and be prepared to distribute those metrics to your executives.
Despite offering numerous opportunities to influence consumers, social programs still account less than 1 percent of an average marketing budget. According to McKinsey quarterly journal, many CMOs would like to increase that share to 5 percent. But the main obstacle is the perception that the return on investment (ROI) from such initiatives is uncertain.
Social media is indeed extending the impact of digital era across a broad range of functions and it’s time for business leaders to indentify the functions, touch points and goals, as well as crafted avenues to measure the impact of social media programs.