Tag: business goals

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Gary Vaynerchuk is Wrong: There is a Social Media ROI

At last year’s LeWeb, my colleague and social media superstar Ayelet Noff asked my favorite wine guy Gary Vaynerchuk the question that we were all hearing in 2009, 2010, and finally forced to answer in 2011: What’s the ROI of social media.

Gary answered that that’s the wrong question – and it’s a problem. Gary asked, “What’s the ROI of your mother?” It’s not about data or Facebook friends or Twitter fans, he said.

He also said that ROI should be “relationship with consumer.”

But ROI of social media is far more than relationships. It’s not just about the The Thank You Economy (though brand goodwill is one tangible ROI measurement)

There are a lot of people getting paid for “social media” consulting because they know how to use Facebook but not measuring ROI. This is how we were all doing it in 2009.

 

emarketer roi

In 2012, it’s time for accountability.

At work, I’ve been a passionate advocate for Twitter – not because I love it (I love whatever tool works) but because it has a high click through rate and is an appropriate tool to integrate with other campaigns to achieve one of my key business goals: qualified leads. But I’ll use whatever tool achieves that goal – Twitter or Facebook, a trade show, or a magazine ad. What matters is achieving the strategic goal – using whatever tool is appropriate given my budget and organization. Social media is part of ecommerce. I’ve made clear sales – actual dollars – directly attributable to blog posts.

What’s the ROI of social media? Here are some possibilities:

  • Sales – immediate, tangible revenue
  • Qualified leads, in whatever form – names/email addresses, downloads, form submissions, etc. – that are targeted and qualified, using your qualification definitions.
  • Lowered costs
  • Customer service questions answered

Define your KPIs first and maybe social media can help you achieve this. On the other hand, maybe not – either way you should be comfortable finding the tool to achieve your KPI.

Here are some answers from Groundswell, Forrester Research’s first book on social technologies, on how social TOOLS can be used to accomplish BUSINESS functions:

groundswell_figure_4-1

The ROI is tangible and quantifiable. Here is another example on how social tools can help save money in customer service can be seen here.

OK, I admit, this title was a bit of link-bait and I’m being a bit unfair to Gary – who knows that the ROI in social media is what we aim to achieve.

In a later interview, Gary made the point that most social media marketers are clowns — talking about Facebook likes and Twitter followers, instead of how social media is a channel to achieve business goals.

Gary made the point that you need marketers who know how to use digital tools to achieve business goals and hiring some 22 year old kid who knows how to use Facebook isn’t the right person to be managing your business.

It’s time to start being accountable – 99.5% of social media “marketers” are clowns – encouraged by marketers who are technoilliterates seeking out the 22 year old kid who doesn’t understand business – those of us who have been doing this for a long time, like Gary, Ayelet, and me all know that this a tool to achieve business results.

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Using Web Analytics to Measure Your PR Results

One of the things I’ve always advocated when consulting clients or internally is to measure business outcomes, not just activities.

Digital marketing has actually made tracking actual business results much easier and much more accountable than print or telephone channels.

In digital marketing, this requires web analytics. There are several types of analytics, but the most popular is click-stream, which tracks actual clicks and visits.

Many of us have Google Analytics or other click-stream tracking set up … but many of us probably have never checked it.

This is a huge mistake. By measuring our web data, we can:

  • determine the effects of our outcomes. In PR, this may be determining which media outlets or wire services drive more traffic or more conversions (you did define your conversion metrics, right?)
  • Determine effective channels
  • Determine which messaging drives more conversions
  • Determining if there are missed messages or missed areas that are gaining traction despite not being targeted – discover untargeted and hidden markets
  • Determine which channels, both paid and earned media, drive more conversions
  • Evaluate decision making funnels, across multi-channel campaigns

 

 

Traditional public relations measured outputs, not outcomes. Traditional PR reports measure data such as coverage volume, placements, sentiment, etc. But what business value does that provide?

Of course, before implementing a tool, we need to define our conversions: our overall business goal and the steps along the sales and decision funnel that are necessary in order to achieve this goal. As our campaign is running, we should be analyzing our results to see where we need to optimize. This may mean pitching new reporters, using a different wire service, or perhaps refining our message.

By incorporating an effective analytics programs into our marketing campaigns, we don’t have to guess the business results: rather we can see them as they happen. Without them, we’re operating blind.