Soon the strategy of "I tweet, so pay me big bucks to send a couple tweets for you" will be a thing of the past (if it isn't already). Social media is settling down after its wild west days as companies begin to apply analytics and insight to gauge ROI. But why is there still question over how to apply measurement to social media as marketers would do for any other channel?
Next Tuesday (December 11, 2012), Richard Jones, CEO at EngageSciences, will host the upcoming JUMP Webinar: Dyspelling the Myths of Social Marketing ROI. We spoke with Jones to give you a little taste of his thoughts on social media ROI measurement and what's in store for the future.
What are the most common myths about social marketing ROI?
The biggest myth is it isn't measurable. I think social media has operated as a silo for too long and this has led to a view that it is difficult to measure value.
Often the people running social media channels for companies have been from community management backgrounds, rather than from a broader digital marketing skill set and therefore don't have the analytics backgrounds to put a framework in place for measuring and communicating value to other stakeholders in the business.
We see this as a challenge and a mission, to help social media managers demonstrate the importance of social media to the senior leadership of their marketing department.
What are the greatest challenges for brands when measuring social marketing?
Knowing what to measure. Social media is not big on first click or last click attribution models. But that doesn't mean it is not extremely valuable.
From the work we have done with hundreds of brands across millions of fans it is clear that social media plays a really big part in the middle of the funnel. Essentially social marketing is about creating value from relationships. Once brands have a program in place to regularly attract and engage fans, they should look at the value achieved from existing customers that are not fans on Facebook six months prior to becoming a fan and then six months after.
They will be shocked at the results. We see on average a 20-30% uplift in value from customers after they become a fan compared to the same period prior to that. This is the power of opening up a new communication channel. You can't email someone 2-3 times a day. They won't be on your website or in your retail premises everyday, but you can communicate to engaged fans 2-3 times a day.
This new communication channel brings you closer to your customers and their wallets over time. It's the power of the middle of the funnel and the relationship you establish.
Why haven’t companies been able to demonstrate a return on social?
The biggest problem is a lack of execution. Just creating a Facebook and Twitter account and doing the odd campaign or app is not that effective. Social media is an always on medium and companies need to commit to it. Frequency of engagement, rich content and attention to the needs of fans are the basic requisites to be successful. If you don't commit to social media, you will fail. So make sure you get management buy-in. Social media marketing needs to be integrated into every other channel you use - website, email, in-store, print, TV. You need to be a social brand to succeed. That's a big change for many companies.
The second major problem amongst companies that are active on social channels are that they are simply unaware of the return they are getting. With no measurement framework in place, or perhaps even worse, focusing on the wrong metrics such as last click attribution models, they will not be able to understand the full picture.
There are many things to consider - socially referred commerce, the value of being a fan vs not being a fan, levels of brand advocacy and perception amongst social media users, social data collection and the reach and engagement around your branded content. Different companies will have different levels of focus for what they want to achieve from social marketing. What's important is to decide what are the top level metrics that make sense for your business to track and then put in a place a process that makes it easy for other stakeholders in the business to follow your results.
What kind of changes have you seen this year in adoption of social media measuring?
There is growing frustration at looking at content optimization as a way of measuring return. It is important to look at engagement levels around your posts and content, but this is only one factor to analyze. Don't be a 'spray and pray' marketer. Flinging content into the social space and looking at how you can optimize how much engagement you get is not the most sophisticated approach.
Not all fans are equal. You need to understand who your most valuable fans are. The top social brands in 2012 started putting programs in place to move fans that are just spectators to become engaged fans and then ultimately advocates that promote the brands content to their friends and followers. These are the top line metrics that the best social brands are tracking.
How does the future look for social media ROI measuring?
Segmentation is a really important word in the vocabulary of a traditional marketing professional. In 2013 segmentation will be really important to social media managers as they evaluate social media ROI and how they are driving value amongst their fans. It is not about the amount of likes you have anymore. That is the wrong thing to focus on. You need to know how to segment your follower base to understand where you are getting value.
On average only 4.7% of a brands following generate social referrals. This is the group that are able to influence their friends to convert on your marketing campaigns. This advocate community are also hugely active - they are 176x more engaged than the average fan who comments on your posts and interacts with your apps. This is your brand army, they have huge reach on social channels and generate massive amounts of socially referred commerce. But you probably don't know who they are and you probably don't have a strategy to concentrate on leveraging that brand army. That is a huge missed opportunity for most companies.
To understand where you are getting value you need to track the activity of every single fan, how they are engaging with you and how they are influencing their friends. That's what we do at EngageSciences. By targeting community managers and marketers to build relationships with the most valuable fans you can increase the numbers in your brand army. Just increasing this number by a single percent has enormous downstream implications for social commerce, social marketing reach and levels of brand advocacy.
Editors Note: Join Richard Jones and Stefan Tornquist, VP of Research North America at Econsultancy, for the upcoming webinar Dyspelling Social Marketing ROI Myths on December 11. We will highlight the processes marketers need to put in place to achieve recognition at the boardroom table and outline the strategies that leading brands are implementing today, and the impressive results they're achieving.