Social Media ROI - Real Activity - Fact or Fiction
A friend of mine Stephanie A Lloyd & I were talking about Social Media ROI and what it means. She shared an article with me by Tim Walker- Acid Bath ROI. TIm makes a really valid point that he wished they would do “ROI on email, meetings and other time-sinks.”
That was a great line to me… Even though I do feel a strategy is very important in everything we do. There are many things that are done daily with little or no strategy using COMMUNICATION tools. That is what Social Media is… a COMMUNICATION tool. See my article about 10 Things Social Media is Not. Social Media is a way to enhance relationships and engage your customers and prospects.
Need to look at what you are measuring… Time spent? Actual Cost? How do you measure a conversation, the reaction to your content etc? Are you tracking the path of the visitor to see where you are converting them? A conversion is not always a sale. It may be request for more info, subscribe to more info etc.
The question may not always be answered in dollars and cents directly…
I have said numerous times there is a cost of not participating… and it may not show up directly on the P&L. One of the biggest costs of any company that does not show up on a P&L is lost sales and time spent on non converted prospects.
I suggest we look at replacing ROI with “business outcomes” when we are talking about Social Media… Wikipedia says it is a change in business performance supported by and resulting from an event. Business outcomes go beyond, defining more valuable business benefits to be gained from Social Media. Better customer service, stronger relationships, high perceived content, and controlling & leading the conversation in your niche and field of expertise.
I believe and have seen Social Media be a facilitator of this principle… It can help put you above the noise. Perceived as an expert and thought leader in your industry and significantly cutting down on the sales cycle and enhancing your image in the prospects eye. They may like you, know you and trust you before you ever talk or meet because they have been following you and have been privied to your thoughts, ideas & insights.
By them knowing you and trusting you it can increase your conversion rate… Social Media is a great place for them to be an advocate of your brand and share it with their networks, which is always great for increased visiblity.
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Since 9/11, clients have cut their advertising spending. What little they spend is mostly on efforts designed to produce an immediate response. Few companies still invest in branding, choosing short term sales over building a long term relationship with their targets.
Social media is filling that gap. In some instances, it does have an immediate impact on a client’s cash register, but more often it’s about building relationships with customers, also called branding. If clients are not educated about social media’s strengths—what it can accomplish and how quickly—they may become disenchanted with their social media investment.
The most successful programs tap into the strengths of traditional media (advertising/PR) and emerging media (digital/social media). All have strengths, all have weaknesses. Combined, they engage those actively seeking information about a product or service and also inform those who might be interested if they knew the product/service existed.
What hasn’t changed with the emergence of digital and social media is the primacy of message. In all media, the message is key. And the most powerful programs unify behind a single big idea.
Jannie,
Great thoughts & points. Creativity is important, but Integrating is the key. Thanks for sharing your insight.
Chad
Chad, I have this conversation a lot. I really don’t agree with people that base their decisions mostly (or solely) on ROI when it comes to marketing. As you point out it is about branding and keeping yourself in the minds of customers and potential customers. For instance, how can you possibly tell the effectiveness of a billboard? Quite difficult to say the least, but I do know that billboards are everywhere. Same for commericals that don’t have a call to action that is trackable (call and ask for…). The goal is to be the first brand that comes to mind when thinking of that type of product.