social media: roi possible
DESCRIPTION
Learn how to plan, justify, and measure the value of your social media initiatives. (Presented at SES San Francisco, Aug 14, 2012 to the theme of Mission Impossible!)TRANSCRIPT
HOW TO PLAN, JUSTIFY AND GAUGE THE VALUE OF SOCIAL MEDIA MARKETING EFFORTS
Angie Schottmuller | @aschottmuller | SES San Francisco | Aug 14, 2012
MISSION: Define ROI or tangible business value to justify use of social media.
SOCIAL MEDIA: The intersection of technology
and social interaction to create, share, or connect online.
ROI % (BENEFIT - COST) X 100
COST
What is ROI?
Example:
($2000 - $500) X 100
$500 300%
Formula:
Seems easy enough...
So why is it so "impossible"?
77% of businesses lack sufficient resources
for social media.
Awareness Inc., State of Social Media Marketing, Jan 2012
70% of businesses plan to expand social
media presence in 2012.
Awareness Inc., State of Social Media Marketing, Jan 2012
Growing Types of Social Media...
• Social Networks • Blogging • Microblogging • Bookmarking • Media Sharing • Discussion Forums • Social Listening • Review Sites • Social Curation • User-Generated Content
• Social Sign-on • Geosocial Sites • Crowdfunding • Social Ads • Streaming Content • Social Gaming • sCRM • Wiki • Social Commerce
Top 3 Reasons Social Media ROI Measurement is Rare:
ü Unclear Objectives
ü Too Many Metrics
ü Difficult ROI Measurement
- eMarketer, 7 Guidelines of Achieving Social Media ROI, Feb 2010
Who's feeling the pressure?
Yup.
Yeah! BIG TIME.
So here's the plan:
q Clarify and align objectives/tactics
q Prioritize meaningful metrics
q Simplify measurement
Strategic Planning Process
1. Determine Scope 2. Gather Business Goals 3. Define Mission/Purpose 4. Set Goals 5. Define KPIs 6. Choose Tactics 7. Define Metrics
WHO?
WHY?
WHAT?
HOW?
ü <Metric> ü <Metric>
KPI:
Social Media <Scope> Strategic Plan 2012
<MISSION>
MISSION WHY ARE WE DOING THIS?
GOALS WHAT DO WE WANT TO ACCOMPLISH?
TACTICS HOW WILL WE ACHIEVE OUR GOALS?
<GOAL> <TACTIC>
<TACTIC>
KPI:
<GOAL>
KPI:
<GOAL>
<SCOPE> Goals: ü <dept goal>
ü <dept goal>
ü <dept goal>
ü <dept goal>
A
B
C
D
A
B
C
ü <Metric> ü <Metric>
ü <Metric> ü <Metric> <TACTIC>
<TACTIC> ü <Metric> ü <Metric>
ü <Metric> ü <Metric> <TACTIC>
<TACTIC> ü <Metric> ü <Metric>
Step 1: Determine Scope What aspect of the business will use social media?
See more: http://j.mp/6socialmedialisteners
Marketing & PR
Human Resources
Research & Development
Customer Service
Executives & Management
Sales
Market Research
IT
SOCIAL MEDIA
FOCUS. You can only
wear one smart lens at a time.
Step 2: Gather Business Goals
What are this year's [SMART] business goals? (Specific to each scope)
CUSTOMER SERVICE: (Example) • Reduce average response time on inquiries • Improve average satisfaction rate • Reduce call volume costs via web self-
service alternatives
80% of marketers incorrectly begin with tactics instead of goals.
START Here:
DO NOT START Here:
Image credit: Jay Baer - http://j.mp/socialmediagoalfunnel
Step 3: Define SM Mission/Purpose
Why are we bothering with social media? (Specific to each scope)
MARKETING: (Example)
To build an army of advocates that in turn help build and maintain the brand's position.
Step 4: Set Goals What do we want to accomplish?
Merge Mission with <Scope> Goals to create social media-specific Goals.
<MISSION>
<GOAL>
<GOAL>
<GOAL>
A
B
C
Note: Some <scope> goals may NOT be relevant for
social media.
<SCOPE> Goals: ü <dept goal>
ü <dept goal>
ü <dept goal>
ü <dept goal>
A
B
C
D
ALL time must be accounted for.
If what you're working on doesn't align to a goal.....
ABORT! ABORT!
Strategic Planning: Balanced Scorecard (BSC)
1-2 goals for each perspective.
1. Customer 2. Financial 3. Learning & Growth 4. Business Process
OBJECTIVE KPI MEASUREMENT Awareness % share of voice (SOV) for online mentions Consideration # of total "social" interactions Leads/Sales # of conversions driven from social media Retention # of repeat blog visitors Advocacy # of total positive mentions, reviews, or
UGC shares
Step 5: Define KPIs
How will we measure goal success?
Examples:
Image credit: DragonSearch http://j.mp/awarenessroi
More KPIs...
OBJECTIVE KPI MEASUREMENT Innovation $ saved or generated as a result of social
feedback Market Research # of "focus groups" providing feedback Customer Service
# of social support inquiries resolved
Social PR # of negative brand mentions resolved (Bonus: # converted to positive mentions)
HR Recruiting # of candidates driven from social media
Note: These KPIs are just examples. Select a metric that's most indicative of progress for your organization's goals.
KPI:
Social Media <Scope> Strategic Plan 2012
<MISSION>
MISSION WHY ARE WE DOING THIS?
GOALS WHAT DO WE WANT TO ACCOMPLISH?
<GOAL>
KPI:
<GOAL>
KPI:
<GOAL>
A
B
C
<SCOPE> Goals: ü <dept goal>
ü <dept goal>
ü <dept goal>
ü <dept goal>
A
B
C
D
Our planning progress thus far... Remember: Plan separate trees for each scope!
Step 6: Choose Tactics
How will we accomplish our goals?
• b
Balance risks: resources, technology, timing...
Understand & Chart How Social Channels Serve Your Goals...
@MagicLogix: http://j.mp/smmchannelsbygoal
Insert your goal
HERE!
Step 7: Define Metrics
How will we measure tactic
success?
A safety net with multiple metrics would be nice...
ü <Metric> ü <Metric>
KPI:
Social Media <Scope> Strategic Plan 2012
<MISSION>
MISSION WHY ARE WE DOING THIS?
GOALS WHAT DO WE WANT TO ACCOMPLISH?
TACTICS HOW WILL WE ACHIEVE OUR GOALS?
<GOAL> <TACTIC>
<TACTIC>
KPI:
<GOAL>
KPI:
<GOAL>
A
B
C
ü <Metric> ü <Metric>
ü <Metric> ü <Metric> <TACTIC>
<TACTIC> ü <Metric> ü <Metric>
ü <Metric> ü <Metric> <TACTIC>
<TACTIC> ü <Metric> ü <Metric>
<SCOPE> Goals: ü <dept goal>
ü <dept goal>
ü <dept goal>
ü <dept goal>
A
B
C
D
Calculations
"ROI can only be calculated AFTER the investment has
yielded a return. It cannot and must not be estimated
beforehand. Ever. Under any circumstances."
~Olivier Blanchard, @thebrandbuilder, Social Media ROI [Book]
Why Measure SMM? 1. Justification/Feasibility 2. Value-Basis for Comparing Tactics
What we really need to do is:
Cost-Benefit Analysis (CBA)
BENEFIT - COST = VALUE
CBA: http://j.mp/costbenefitanalysis
Cost-Benefit Analysis
BENEFIT
COST
§ SM Labor § IT Labor § Tools & Software § Opportunity Costs § Training § Risk
§ Awareness § Web Traffic § Lead Generation § Sales § Conversion § Customer Retention § Loyalty § Advocacy § Satisfaction § Market Research
GROW REVENUE IMPROVE
SATISFACTION REDUCE COSTS
All that matters...
Reference: Jim Sterne's book, Social Media Metrics
GROW REVENUE - SOCIAL METRICS
What can you impact via social?
• # of QUALIFIED LEADS • # of NEW CUSTOMERS • # of REPEAT CUSTOMERS • % of CONVERSIONS Social Proof Examples: Star-ratings, reviews, user-shared photos/videos, # comments, # shares
Image credit: http://j.mp/awarenessroi
Cars.com Online Reviews Pages with reviews had:
• 16% higher conversion rate
• 100% more traffic driven to dealer sites
Case Study: http://j.mp/carscomsmmroi
GROW REVENUE - SOCIAL MEDIA ROI CASE STUDY
CareOne Social Sales Support
Customers coming through social channels:
• 179% higher conversion rate to complete a consultation form
• 732% higher rate of completed first payment
Case Study: http://j.mp/careonesmmroi
GROW REVENUE - SOCIAL MEDIA ROI CASE STUDY
REDUCE COSTS - SOCIAL METRICS
Quantify the equivalent value as if you had to pay for these:
• MEDIA VALUE – # of Website Visits (social referrals) – # of Online Mentions – # of Articles / Social PR – # of User-Shared Content (Photos, Videos, Testimonies)
• WEB SELF-SERVICE • REQUIRED STAFF TO CUSTOMER RATI0
How much would a
photo/video shoot cost?
Old Spice Videos
Correlation impact of social buzz:
• 27% sales increase year on year (since original Mustafa campaign)
• 55%-107% sales increase during the social media campaign
Case Study: http://j.mp/oldspicesmmroi
GROW REVENUE & REDUCE COSTS - SOCIAL MEDIA ROI CASE STUDY
SATISFACTION - SOCIAL METRICS
Survey users for feedback and crunch Lifetime Customer Value (LTV) numbers.
• % of POSITIVE SENTIMENT IN MENTIONS • AVERAGE % of STAR-RATINGS (EACH LEVEL) • CUSTOMER SATISFACTION SCORE • % WHO FOUND WHAT THEY WERE SEEKING • LIKELIHOOD TO RECOMMEND % • # REPEAT WEB VISITS / WEB RECENCY
Compute LTV with Avinash: http://j.mp/calculateltv
InfusionSoft Social Customer Service
• 1:72 to 1:172 reduced agent to customer ratio
• 10% higher customer satisfaction
Case Study: http://j.mp/infusionsoftsmmroi
REDUCE COST & IMPROVE SATISFACTION - SOCIAL MEDIA ROI CASE STUDY
Multichannel can add confusion...
Quantify "Social Attribution"
• Web analytics tracking • URL shortener (e.g. Bit.ly) • Social-specific promo codes • Third party tool analytics (e.g. Bazaarvoice) • Online surveys (e.g. Foresee, KISS Insights) • A/B tests • ASK the customer!
ACTION PLAN 1. Assessment - Analyze current state, include SWOT
2. Strategy - Map out social media plan by scope
3. Pitch - Present top ideas to IMF
4. Prep - Secure resources, budget, tools, training, etc.
5. Implement - Execute the plan (Abort if necessary)
6. Review - Analyze activity & ROI using multiple metrics
7. Optimize - Gathers insights and improve for the sequel
Only
20% of marketers measure social media ROI.
- eMarketer, 7 Guidelines of Achieving Social Media ROI, Feb 2010
It's time for YOU to lead
the way.
KEY TAKEAWAYS
• Define separate strategy for each scope/dept
• Set clear objectives before picking tactics
• Select high-level annual goal KPIs (resilient to tactical changes)
• Use cost-benefit analysis (CBA) for justification and comparison
• Focus on measuring the 3 key objective buckets
• Recalculate CBA and ROI after implementation
"The impossible can become possible,
IF... YOU'RE...
AWESOME!" - Rhino [Disney's Movie, Bolt]
MISSION: Apply these tips and share this presentation, so your social media
initiatives don't self-destruct!