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Demand Generation • Market Research • Social Media Marketing
Although social marketing is a top priority and critical for future success, marketers struggle with ROI measurement of social campaigns, as a result, constraining or threatening all important future funding.Surveys report that even though ROI measurement is vital to success, that:
- Some 75% of B2B social marketers currently not measuring the ROI of social initiatives (MarketingProfs)
- Almost two-thirds of companies (61%) indicating their organizations are “poor “ (34%) or “very poor “ (27%) at measuring return on investment from social media (E-consultancy survey of 400 companies, Jan 2010).
Most marketers want to be social ROI savvy, but are currently not able to advance beyond traditional activity measurements to tally the competitive and financial value/bottom-line impact of social marketing programs.
Measurements such as website site traffic, the number of followers/fans/subscribers, SEO ranking, posts and mentions are currently being used to determine whether social marketing efforts are delivering results. Although important measurements, these activities do not translate to competitive advantage, or bottom-line business impact, so crucial in convincing c-level executives that current programs are working, and even more should be allocated to these essential initiatives.
These activity based metrics, such as tracking fans/followers, site traffic and posts are best used to help social strategists and community managers drive more successful campaigns, but do little to convince marketing and C-level executives that investments in social marketing programs are valuable.
Clearly, different stakeholders require different types of social media reporting – moving beyond activity tracking to assure that the social marketing programs are driving incremental sales and loyalty, mitigating business risks, improving marketing and business efficiency, and driving competitive brand and financial advantages.
But moving beyond activity to communicate the metrics that matter to executives can be difficult:
- The Buyer’s Journey is non-linear and complex making attribution of tangible benefits to social marketing and specific campaigns difficult:
- 38 different marketing vehicles and growing (Forrester 2011)
- An average of 7.6 different marketing sources are used throughout the purchase decision (Forrester 2011)
- Multiple marketing/sales touches per sale making attribution difficult
- Long time frame for most businesses/transactions make it easy to lose track of the value chain
- Financial benefits include revenue, but the benefits of social marketing go beyond just that one success measure to include marketing efficiency improvements, customer loyalty, support cost reductions, and the benefits of collaborative innovation
- Social marketing benefits go beyond just tangible financial quantification and need to include risk management & brand improvements
- The method and metrics used to calculate these benefits can differ dramatically based on the industry and business model
- Information on competitive social advantages is often vital to success, particularly where developing and maintaining an innovative lead is so key, but the metrics are often difficult to gather, compare and maintain
- Multiple groups, stakeholders & systems make integrating and summarizing information difficult
The Bottom Line
Marketers recognize that proving the value of social marketing efforts is a requirement to help address Frugalnomics – the trend towards significant economic justification, and more skeptical and frugal decision makers.
However, the move towards better measurements and value quantification has not been easy, with the majority of marketers still relying on activity measures to prove success, versus more tangible top / bottom-line measures and tracking competitive advantage.
Tom Pisello, The ROI Guy, and Chairman and Founder of Akonna, has been developing measurement software for ROI and economic justification for the past 20 years. Tom’s newest creation, Akonna, is an emerging Saas provider for measuring, proving and improving the ROI of marketing campaigns and social media efforts. For more information about Akonna, please visit www.akonna.com.VN:R_U [1.9.7_1111]ROI Measurement is Vital, But Still a Challenge,
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