About a year ago, I asked in a blog, “What’s the ROI of social media?” Since that time, the topic’s received a lot of play, but I think things are starting to come into dramatic focus as marketing executives begin to capture proof points around their social media activities.
A year ago, the circles in which I travel (technology companies) were clearly experimenting with social media, but it was a small part of their overall strategy and budget. It was one of these “let’s try it and see what happens” type of things.
I don’t think tech companies have any better handle on the ROI question today than they did a year ago. But what they do have is metrics that demonstrate that social media is often more effective at achieving marketing objectives in areas where ROI is hard to measure -- like traditional public relations, analyst relations, and print advertising.
I’m not talking about direct response advertising, as clearly the ROI of those activities is measurable. I’m talking about all the fuzzy things technology companies do to advance their thought leadership -- like paid-for whitepapers and analyst/trade press briefings.
I’ve come to the conclusion that it’s not about measuring ROI; rather, it’s about measuring the return on objectives, which by definition are measurable. And the companies I observe are steadily shifting their resources toward social media to achieve their objectives.
In many cases it’s not part of a grand plan -- it’s just one of those things that’s happening, and the discussion is moving from “We can’t measure this stuff” to “How can we measure social media effectiveness?”
The answer is return on objectives. What do I mean by that? Return on objectives is achieving or exceeding the outcome of a desired marketing objective. It’s not a goal. Goals are bigger picture. So, for example, your goal might be to increase the awareness of your company’s brand in the data center. And your objectives to do that might be something like this:
By June 2010 we will...
Get 10 trade press articles written about our technology by large IT publishers
Have five major analyst firms reference our technology in their research
Have 10 relevant blogs link to content on our Website
Increase Web traffic by 25 percent
Reach 1 million impressions for our company’s brand on Twitter
Notice all the objectives are measurable. The return is binary -- either you achieve the measurements of the objectives or you don’t.
The next step companies are taking is to lay out a set of activities that will allow them to achieve their objectives. So, for example, the activity behind “Increase Web traffic by 25 percent” is to “generate one piece of content for the Website each week that will help drive traffic.” Then the execution of this activity will involve selecting the topic, the writer, and the means of marketing the content to drive the traffic. After that, it’s time for measurements.
Marketing executives in technology circles are discovering three things:
1) The activities to achieve goals are increasingly Web-oriented.
2) Social media can reach orders of magnitude more people than traditional media.
3) The elapsed time of achieving objectives is being cut in half.
The key to success is taking the time to think through a strategy that says, “If we achieve these objectives, will it advance our goals?” There is no magic to that. But one thing is clear: Social media marketing activities are on the rise and will grab an increasing share of spending for 2010 and beyond.
— David Vellante spent 15 years at IDC and is a founder of The Wikibon Project. He can be reached on Twitter at @dvellante.
Now that I've read the article - which I missed because I wasn't here in October - I see what you mean. And I think you are probably right. It's an unusual strategy in this day and age. It was much more common fifteen years ago - just get the audience and worry about the revenue later - and that approach was been pretty much discredited by 2001.
Twitter just might get away with it. I just hope everyone remembers how rare it is, and how difficult it is to pull this off.
You're right about the statistics - - at this stage, I think you could just stir the pot and still convince someone that the stats you quote are close to truth. What is closest to the truth is that you can measure and present this data in so many ways to make your point, wither way. IMHO, but I've seen it many times last 12 months.
There are statistics and damn statistics. While there may be increasing and even endless ways to measure the evermore growing amount of data available from social network users, trying to find a sure fire way to make money may be impossible in the long run. It all is a hope and pray game at this point.
@ LEK1981 - It's like the line from The A Team - I love it when a good plan comes together!. Sometimes the best stuff happens not by planning it to death, but just a :eureka: or :wow: effect. And often, these are more rewarding, as in your example, because it wasn't driven by an ROI, unless the I stands for INTEREST not INVESTMENT.
So many today are "monetizing" EVERYTHING and it's just not always as simple as that when it comes to ROI. David's ROO is a much better, more comprehensive way to measure something as slippery as this.
It's not just about the investment being returned upon, it is SO SO SO much more in today's market, and I think the moment has come for others in every department to turn to the beancounters and say "ENOUGH!" -- some seriously great creative is wasted due to it's perceived lack of monetization WHat's the objective, how do we measure our success against that -- some things have not changed.
SM isn't the only tool in the box, but one which should be explored, please don't get me wrong. but it's still just a tool.
That's a really good monetization example, lek1981. Chris Brown owes that wedding party a royalty check :-)
But it's an isolated example just the same. And as you point out, no one was planning for it. The label must have felt very, very good sitting back and watching the digital sales of "Forever" skyrocket.
I very seldom click on an ad fed to me on Facebook. Like Tivo'ing through the commercials, it's just so easy to ignore the ads on my Profile page. Sure, as a newbie I used to click the thumbs-up (and there used to be a thumbs-down, too, of course) but now that I'm all seasoned and stuff, I just skip 'em. I imagine most people click now and again on an ad, and some click a ton and others have never clicked in their life.
I love SNS and use it to promote my businesses, but I don't spend a dime to do anything premium ad-wise because it seems too needle-in-the-haystack to me. I wonder what a social marketing media pro would say about the quality and quantity of the customers and prospects they reach using these methods.
Indeed, Twitter and Facebook are a marketers dream especially since it is instantaneous, measurable, 24/7, global and doesn't cost much at all. You used to require significant marketing budgets to reach a desired target market. Now you can do it for almost nothing online. That in itself is not just evolution, but revolution! Today, you can't really apply for any marketing job without having social media techniques, know-how or experience. That is why we are seeing more jobs requesting it.
The ThinkerNet does not reflect the views of TechWeb. The ThinkerNet is an informal means of communication to members and visitors of the Internet Evolution site. Individual authors are chosen by Internet Evolution to blog. Neither Internet Evolution nor TechWeb assume responsibility for comments, claims, or opinions made by authors and ThinkerNet bloggers. They are no substitute for your own research and should not be relied upon for trading or any other purpose.
I had the opportunity recently to meet with Jeff Kubacki the CIO of Kroll, a global risk management consulting firm and a unit of Marsh & McLennan Companies with more than 50 offices worldwide. Kubacki has been the CIO of Kroll for about three years and seems to have a good process for aligning IT strategy with business priorities.
At Twitter’s Chirp developer conference last week, the company confirmed that Twitter has more than 100 million registered users, 300,000 new users per day, and 180 million unique users per month. So I guess it’s inevitable that Twitter would finally start to “grow up.”
The Twittersphere is buzzing with rumors that Yahoo Inc. (Nasdaq: YHOO) is considering shelling out $100 million for Foursquare, the hot startup du jour that offers location-based services.
Getting to Work on Smart Work: How IT Is Transforming the Implementation of the 'Internet of Things' Organizations in all industry sectors are becoming more instrumented, interconnected, and intelligent -- and that's changing the way they approach virtually every facet of their operations. It's up to IT to help organizations adopt a "Three I's" approach that leverages the emerging Internet of Things and enables them to work smarter. READ THIS eBOOK
your weekly update of news, analysis, and
opinion from Internet Evolution - FREE! REGISTER HERE
Wanted! Site Moderators Internet Evolution is looking for a handful of readers to help moderate the message boards on our site – as well as engaging in high-IQ conversation with the industry mavens on our thinkerNet blogosphere. The job comes with various perks, bags of kudos, and GIANT bragging rights. Interested?
To save this item to your list of favorite Internet Evolution content so you can find it later in your Profile page, click the "Save It" button next to the item.
As enterprises leap into the Web 2.0 world of blogging, commenting, and social networking, just 'being there' won't deliver ROI. You may want a 'Web Evangelist' to systematically harvest the feedback in order to polish your product or service.
More companies are trolling social networks to find and vet potential job candidates. Beware the pitfalls of blurring the line between personal and professional lives.
When Reiter gets incensed over incompetent Verizon FiOS order-taking and support, he broadcasts it via Twitter. Did it do any good? How should your company offer Twitter support? Watch this for all the answers.
Evidence shows that you can tweet too much. Sites and services like Twitter and Facebook are a good place to reach your audience, but think quality over quantity.
Tom’s research shows that IM, SMS, and social networking distract a third of knowledge workers but make the other two-thirds more productive! Which group are you in?
Marketers want to sell you stuff, and they need your help. It's crazy, it's crass, it's fun for the whole family! It's the art form of the new millenium!
Nielsen’s recent numbers on the increasing use of texting bode well for enterprise networks. Shunning the phone in favor of text messaging could mean reducing bandwidth.
RIM is giving in to demands by India to snoop on encrypted BlackBerry data. It's time to develop cheap or free encryption software for BlackBerrys and other cellular phones.
Two studios have filed suit against an ad broker for placing ads to help monetize P2P sites suspected of copyright infringement. That's taking a dangerous step toward what might be a worthy goal.
By 2014, mobile devices will overtake laptops as the appliance of choice for consumers. But device makers still have some wishes to fulfill, including mobile app simplification and the ability to better perform word processing/spreadsheet functions.
Google's foray into pay-for-view movies may be an indicator that the days of free ad-sponsored content are numbered, or at least that ad sponsorship won't fund nearly enough content.
Online education, improving to better replicate the interactions that occur between teachers and students face-to-face, grew in double digits during the recession. Still, there’s more work to be done.
Google's decision to link VoIP calling of PSTN numbers with Gmail, and to let Google Voice "call" Gmail VoIP clients, will devalue the PSTN and force telcos to fund unprofitable services or create their own VoIP transitions.
Digg
Del.icio.us
Reddit
Email This
TWEET THIS
