This article is the third in a series of ongoing extracts from Econsultancy’s new Internet Marketing Strategy Briefing. The free-to-download report covers the most important online trends in digital marketing that currently occurring.

Topics covered within the document include customer centricity, channel diversification, data, social media and content strategy.

This extract, written by Econsultancy’s US Vice President of Research, Stefan Tornquist, focuses on the ins and outs of measuring social media.

Refining data 

We hear that “data is the new oil” and maybe so, but just like crude oil, data needs to be refined to maximise its value. It needs to be processed into actionable insight. Online and mobile activities generate vast amounts of data and there are no shortage of tools and technology available to analyse it. But the reality in many cases is “analysis paralysis”, little actual insight, or recommendations that can’t then be acted upon owing to a lack of relevant resources. 

Online provides a rich vein of behavioural and attitudinal data, but it is typically when the new data is intelligently combined with existing data to provide a ‘joined up’ view that it becomes most valuable in optimising marketing and business effectiveness. Currently the biggest barrier to making this happen is a lack of the right people and skills, namely those who have both the analytical skills and a keen commercial/marketing sense.

All too often, companies focus on the data as an end in itself, a benchmark of their success. It is worth remembering the ultimate reason this data has value, which is that it helps people. It helps them get the best offer, the fastest delivery, the most relevant recommendation… data manifests in any number of tiny ways in which products and the service that supports them are made better for the customer.

Even as social media has become the most heavily explored and discussed marketing tactic, marketers have struggled to understand its true value. Many organisations have had difficulty defining their social strategy and therefore have trouble understanding the explicit and implicit results of their social programs.

Most surveys of practicing social marketers have aligned its value with brand building, thought leadership, customer service and other important, but difficult to measure, ‘soft’ benefits. When the question posed is ‘What is social media good for?’, direct sales usually ranks toward the bottom. However, this ignores the increasing degree to which social media enables customers themselves as a channel for sales, PR and customer service.

Typically, the companies that have seen the greatest rewards from social media have approached it in phases. 

  • First, as a listening platform to understand the lessons of relevant conversations and determine where they are taking place. 
  • Second, as a place to encourage interactions with existing and potential customers around activities of value to them (service, discovery, fun, etc.)
  • Finally, as a sales channel that acts as much to enable and accelerate purchase through complimentary channels as to sell directly.

Underlying this approach is an essential element to social media success – the willingness to experiment, learn and optimise. In contrast with the elegant and easy to understand pay for performance PPC model, social media is complex and its value varies significantly based on a number of variables. And while they may be hard to measure, the soft brand-focused metrics are definitely something to consider when measuring the success of your efforts. 

Organisations seeking to measure social media impact can do so in a number of ways.

Social benchmarks

One of the hottest topics in analytics is the question of assigning value to the measures of social media success offered by social platforms. Primary among these are the Facebook fan, the Facebook ‘Like’ and the Twitter follower. 

Much has been made of a Syncapse report which calculated an average value of $136.38 to a Facebook fan, based on interviews with 4,000 fans of several prominent brands.

The methodology can certainly be debated, but ample data supports the idea that fans are worth more than non-fans. However, fans are, by definition, consumers who are already engaged with the brand. As a benchmark, the fan measures the success of the brand in engaging with that customer up to the point when they became a fan. Their being a fan doesn’t mean they will spend more, rather it’s a way of identifying someone who would spend more anyway.

However, moving forward from the point at which the consumer becomes a fan or ‘Likes’ your brand, there is new value for the marketer. Fans are typically more active social users, with larger networks and the desire to connect with them. Once they’ve asserted their affinity, they can be communicated with using messaging that’s analogous to email marketing. They are also more likely to share content and communicate with their networks about a brand or product for which they have expressed that affinity.

The best analogy for social followers is the less glamorous house email list. As the opt-in gives way to the ‘Like’ or ‘Follow’ the same truths hold fast: these are valuable customers or prospects who want to know what your brand is doing, what products you’re premiering and what value they can achieve from the relationship. And, just as in email marketing, those brands that treat their followers with respect, and as their most valuable segment, will reap the rewards.

Action and interaction

Friends and Followers are worth tracking, but it’s perhaps more important to ask (and optimise) against what they’re doing once they’re part of your brand’s social family. Are they sharing your messaging? Why or why not? Are they doing the work that social media promises brands – selling to their networks, talking about the brand, answering questions? The answers to these questions go directly to the bottom line, and should inform the evolution of social marketing programs.

Participation says something about the kind of traffic you are attracting. Remember that an engaged customer should be a highly valuable one. Interaction can be anything from leaving comments, to participating in support forums, to leaving customer reviews and ratings. It can happen on your website and on other websites. 


This is one of the more obvious ways of measuring social media. Remember that quality often beats quantity, though not always (as many CPM-focused publishers will surely testify). 


We at Econsultancy are tracking sales from organic Google referrals and also paid search. It didn’t seem like much of a leap to track other channels, such as Twitter. Try it. Dell did, and discovered that it made $1m from Twitter in 18 months. Blendtec’s ‘Will It Blend?’ campaign on YouTube helped to drive “a five-fold increase in sales”. 


Some companies simply cannot process sales online, because their products or services do not allow for it. Any high value or business to business product line may be exempt from e-commerce, but benefit greatly from the word of mouth power of social media. 

Search marketing

The SEO factor cannot be overstated. Social media can be far more powerful in this regard than you might initially imagine. For example, a well-placed story / video / image on a site like Digg will generate a lot of traffic and a nice link from Digg itself, but the real win here is that it will generate a lot more interest beyond Digg. Bloggers and major publishers are following Digg’s Upcoming channel to unearth new and interesting stories.

One link and 20,000 referrals from Digg might lead on to 40,000 referrals and 100 links from other sites. The long tail, in action. 100 links means that your page might well wind up being placed highly on Google, resulting in lots of ongoing traffic. Remember too that you can use sites like Twitter and YouTube to claim valuable search rankings on your brand search terms (‘social search optimisation’).

Brand metrics

Word of mouth and the viral factor (inherent in sites like Twitter, Facebook and Digg) can help shift the key brand metrics, both negatively and positively. These include brand favourability, brand awareness, brand recall, propensity to buy, etc.

Expensive TV ads are measured in this way, so if these metrics are good enough for TV then they’re surely good enough for the internet? Positive brand associations via social media campaigns can help drive clicks on paid search ads, and responses to other forms of advertising. We know that TV ads boost activity on search engines, resulting in paid search success stories, so I’d bet that social media can do the same.


The nature of public relations has changed, forever. The last five years have been largely about the traditional PR folks not really being able to figure out the blogosphere. But if PRs cannot control the bloggers, then how on earth will they handle consumers?

The distinct worlds of PR, customer service, and marketing are fusing. Twitter means everybody has a blog these days, and somewhere to shout about things to their friends (and beyond). Social media sites are the biggest echo chambers in the world! In any event, if you can measure PR (beyond adding up column inches and applying a random multiple to the equivalent size on the rate card), then you can measure social media.

Customer engagement

Given the prevalence of choice, and the ease with which consumers can switch from one brand to another, customer engagement is one of the most important of all metrics in today’s business environment. Engagement can take place offline and online, both on your website and on other sites, particularly social media sites. Customer engagement is key to improving satisfaction and loyalty rates, and revenue.

By listening to customers, and letting them know that you are listening, you can improve your business, your products, and your levels of service. The alternative is to ignore customers, which sends out a terrible message. Our research found that an engaged customer will recommend your brand, convert more readily and purchase more often. 


A positive side effect of increased customer engagement should be an increase in customer retention. This is going to be a crucial factor in the success of your business in the years to come.

Make no bones about it: we are moving into an age of optimisation and retention. Watch your retention rates as you start participating in social media. Over time, all things remaining equal, they should rise. Zappos, which is a case study in how-to-do-Twitter (and active on MySpace, Facebook and YouTube), is closing in on $1bn of sales this year, and “75% of its orders are from repeat customers”. 


If you can reduce customer churn, and engage customers more often, the result will surely be that you’ll generate more business from your existing customer base (who in turn will recommend your business to their network of friends, family, and social media contacts). This reduces your reliance on vast customer acquisition budgets to maintain or grow profits. It makes for a far more profitable and more efficient organisation.

We really hope that more businesses will find a better balance between acquisition and retention, sooner rather than later, from a resourcing standpoint.

Too many acquisition strategies appear to be ill-conceived, are not joined up (both in terms of marketing and also operations), and as such are ripe for optimisation.

Plug the leaky bucket and you won’t need to turn the tap so hard to top it up. And remember that old adage about it being cheaper to keep existing customers than to seek out new ones.