No one wants to waste their time.
Also, people are very interested in how to start calculating ROI. I checked with the Google Adwords Keyword tool and found that nearly 78K people search for some variation of “measuring ROI of social media” every month. That is a lot of people that are interested in measuring social media marketing and public relations efforts.
In fact, if you came to this post from Google, you can read some of the theory below (and about some nifty tools), then you can jump to the good stuff. I have an extensive collection of bookmarks of the ROI on social media and a measurement category with some nuts and bolts on how to measure public relations and social media.
Also, if you want to get some amazing books, you can jump to the end of this post or over to the contest where you can win one of two new books that will help you start to put together a social media measurement program.
Value Drives Measurement
Organizations, both for and nonprofit, need one to be sure that the valuable time they spend on social media, public relations and marketing matter to their most important constituents, be they customers, donors, members, etc.
The resources of a company are finite and need to be allocated wisely. Every hour someone spends on Twitter is another hour they might be engaged in other marketing activities that are more valuable – both to the company and to the people it is trying to reach. And thus the most common question from management:
“What is the value, or ROI, of a particular marketing or PR activity.”
And now that social media is not a fledgling enterprise anymore, with big brands investing millions of dollars in campaigns with social media as a primary or major aspect. And even nonprofits need to make decisions about participating in contests and activating their donor base via social media. What are the benefits and tradeoffs.
The only way to know is to measure.
This chart of a Marketing Measurement Continuum spells it out. On the bottom rung is Activities-Based marketing and PR, here there is rarely measurement.
The real magic occurs as you move up the continuum and get better metrics, from operational insights, to more efficient processes, to business outcomes and finally to being able to predict an outcome.
It takes work, and accountability. But the payoff is huge. And as you can see, it is a PROCESS. You don’t start with predictive analytics. Some good Marketing Mix Modeling dashboards might even take over a year of data before you get a lot of predictive insight. Same with calculating Customer Lifetime Value. You might need a year’s worth of data about the behavior of your current customers or donors to get reliable data. Here is a cool calculator to get you started.
Two of the people who influenced many of us in the areas of social media measurement include Katie Paine and Olivier Blanchard. They both recently released new books on the subject, Katie’s “Measure What Matters,” and Olivier’s “Social Media ROI” book. I have already started to dig into Katie’s book and Olivier’s is on the way, yay for Amazon Prime.
The Zoetica team would like to share one of these book with you.
Tell us why you think ROI WIll Never Die on the website above. The first 10 REAL answers win.
And as much as I LOVE to get comments here, posts on this page don’t count. 🙂 What is the ROI of that?