Apparently, this is how you calculate the ROI of social media. But let me expand further below the jump…
It was the moment people in the room had been waiting for. The presenter was at the start of his presentation into Social Media Effectiveness. The slide was a picture of a cup of tea. The accompanying summary “Trying to find the ROI for Social Media is like trying to find the ROI for a cup of tea”. Silence descends on the room. People leave. Social Media slowly dies.
If this is genuinely what we think about Social Media ROI, then the industry is in big trouble. I know there are exponents thinking differently about ROI, trying to approach it and create a smart way of looking at how Social Media contributes. We all talk about “effectiveness” but what we show is “affect”, not actually a ROI. How come we can’t get there any quicker?
When I first started in the industry, the year 2001, we were attaching margins to search keywords for clients like Expedia. It was simple. We knew the page people landed on and could assign a value to that page, then link back to the keyword. We can create goals in Google Analytics and link that back to unique URLs, so we should be able to link a video view to a visit to a sales page.
The problem is we focus on engagement. Engagement is simply the first stage in a consumer journey. Yes, we should be producing content that is engaging, but there are different types of engagement as highlighted below.
We need to start taking the lack of proven ROI seriously. Otherwise Social Media might just be left on the side as “something we tried”, I’m looking forward to the next IPA Social Media Effectiveness conference where we have genuine case studies about ROI, Effectiveness, and some award winning effectiveness campaigns.
I recently had a really interesting conversation with a favourite client. We “clashed” over a chart I produced saying that insight and data are what drives digital strategy. The client had recently attended a conference where big players such as Unilever were saying that data is killing marketing. Interesting.
At that point in time I didn’t think that was the case, but actually perhaps she was right. I don’t think data is killing marketing, but I do think bad research, pointless numbers, or data lacking real insight is. Not a day goes by where I don’t see data from a social media agency or research panel, pointing out how great social media is or who isn’t great at it. These are interesting, for a bit, but I think they are damaging to the industry that we work in. Fundamentally, this sort of research is clouding the more serious issues that we, in social media, need to answer. (continues below…)
Some recent examples include:
- Nielsen’s “People who follow celebrities, also follow brands” (Link here)
- Radley Yeldar’s “Not all the Top 100 FTSE companies are that social” (Link here)
- Peer Index’s “whoever has the most influence on twitter is the best social agency” (Link here)
Its not that I completely disagree with these reports, I just don’t feel they are going to help drive the industry forward to the point where we are a meaningful force, with hugely credible research supporting investment. As we have seen, and as Brian Solis pointed out, Social ROI and research is time-consuming. It takes time to pull together tools which don’t always answer the questions we post on their own.
I think focused research, potentially lead by the IAB, will enable all parties to sell in the idea of social media without the slightly dismissive notion that “companies simply aren’t committed to being open and transparent”. The more we push out meaningless stats, hand drawn infographics, and basic panel results (I saw one recently for 40 people and it was being billed as conclusive) the less seriously people will treat tools like BrandWatch, Radian6, or others.
My background is data, direct response, boring I know. However, I do think its the responsibility of all of us who work in social media, those who study social culture and preach twitter/facebook, to create groundbreaking research into what we do convincing more clients than just Coke to invest sizeable chunks of their media and ad spend.
The key things I would love to find out are:
- What the differing ROI of followers/fans/likes are across multiple industries.
- What is the value of an influencer tweet/post/update about our brands.
- What is the path to conversion from a video play to an in-store sale.
- What factors should be considered in the differing approaches to social channels and how do these convert to sale differently.
- How successful is the shortening of the commercial process by “socialising” your commerce platform.
I’d much rather see these. And you, what would you like to see?
