Traditional methods of measuring ROI are misplaced when it comes to gauging the impact of social media initiatives.
Now more than ever, brands want to be “liked.” Facebook, Twitter, Instagram, Tumblr and many other platforms allow brands to connect directly to consumers. Even traditionally B2B brands have embraced social media. Increasingly, though, marketers have questioned the ultimate value of these efforts, asking what is the value of being “liked”? Certainly, it is difficult to determine the return on investment for social media interactions. Major brands from Coca-Cola to Nissan to MasterCard have all admitted they don’t know if their social media investment impacts their bottom lines. Because it is difficult to determine “social ROI,”.
Toyota’s successful Mini Van Swagger Wagon Social Media Campaign didn’t change the overall image of the Minivan’s in the customers mind. It’s not necessary that a successful social media campaign will help you build your brand, but as a marketer is that the only question that one should ponder upon.
By thinking about the problem purely in terms of financial returns—on what are usually relatively small investments to begin with — marketers shortchange the ultimate value of social and potentially miss out on opportunities to meet many different kinds of important business objectives.
- The real value of social media initiatives is in developing and strengthening a relationship between a brand and its consumers.
- Traditional ROI measurements and attempts to analyze direct impact on sales are futile and misplaced.
- Marketers should measure social initiatives in terms of branding and satisfaction metrics like Net Promoter Scores, which measure both satisfaction and virality.
- Advanced attribution models, like Agent-Based Modeling (ABM), are the best ways to predict how social media efforts might drive offline user activity that meets business objectives like increasing sales or decreasing call center volume.
- Brands can’t measure social media success without knowing their business objective.
Early on, too many brands rushed in to building a social media presence but lacked a cohesive strategy that aligned with overall business goals. Social was and for many still is a silo, but it’s critical to align social media KPIs with specific business objectives. Brands should establish goals before the start of a social media campaign and determine what kind of tracking measures they need to implement upfront. Goals may include generating revenue, reducing customer service costs, shifting brand sentiment, improving operational efficiency, cultivating customer relationships or gleaning insight into target markets.
As mentioned previously, the social media strategy should align with the overall business objectives. For example, a company with a reputation issue may focus its social media efforts towards shifting brand perception. Awareness may already be high, but if sentiment is negative, social media can help change that. Brands can also have multiple objectives, and need to keep that in mind when measuring impact.