Note: This is an excerpt from what I teach my social media marketing classes on introduction to metrics and measurement…
Gary Vanyerchuk, online wine entrepreneur and social media celebrity, has famously said “What is the ROI of your grandmother?” in response to recurring requests for the range of return on investment enjoyed by corporations. Other social media advocates have asked similar rheotrical questions such as, “What is the ROI of your phone?,” or “What is the ROI of breathing?,” suggesting that social media activity is essential to the ongoing vitality of an organization. Questions about the return on social media efforts have come up increasingly often as more corporations and organizations, not just the early adopters, have become actively involved in social media marketing and organizational spending has increased on SM applications.
Some SMM experts have indicated that the return on social media efforts are too indirect, too subtle, or too long term to measure: arguing that the time and effort involved in even trying to measure the ROI of social media efforts could be better focused on improving those efforts. An implication underlying these arguments is that the effort of trying to measure a return on investment of these activities will harm the social media effort, a kind of negative observer effect that harms the process by measuring it. Generally, however, organization have found benefit from measuring and monitoring other key activities such as advertising, promotion, and selling efforts.
To some extent these arguments about measuring the effectiveness of social media efforts mirror what people said about measuring marketing or advertising efforts a century ago. One of the early marketing pioneers, John Wanamaker, is often quoted as saying, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” With time and effort difficulties in measuring the impact of advertising and public relations were overcome and metrics were developed that are today diligently applied to these marketing efforts. Soon measures will be just as diligently applied to all organizational social media activities.
“The ROI of social media is your business will still exist in five years.”
—Erik Qualman, Socialnomics
Metrics: The importance of Measurement
1. Understand debate about whether social media marketing is measurable or should be.
2. Understand the importance of clear metrics: why what is measured is treasured.
Arguments against trying to measure social media marketing (“SMM”) success are already subsiding. At the minimum, measurement is needed because all organizations, whether for-profit, non-profit, or charitable, have limited resources of time, money, and attention. Activities must be judged by their costs versus their contribution to the mission of the organization and weighed against the costs and benefits of competing activities that the organization could undertake. Making decisions on proper allocation of resources will inevitably be based at least in part on these relative measures of effectiveness.
What is Measured is Treasured
“What gets measured gets done” is a motto of management by objectives, first popularized by renowned management thinker Peter Drucker (1954). Deming (1986), whose teachings have been credited for aiding the incredible improvement in Japanese quality and productivity in the late twentieth century, stressed that “there is no substitute for knowledge,” and urged management to try to measure everything, even hard-to-understand phenomena. If social media (“SM”) is to be a vital part of an organization’s marketing, public relations, customer service, and/or communications activities, the impact and contribution of social media must be measured: what is measured is treasured.
The persons and teams responsible for the social media efforts should be champions of the measures and metrics of social media success. A social media marketing manager will want to make sure that goals established are attainable, that she or he will be fairly assessed, and that the manager knows how he or she will be assessed. Good measures will allow the social media manager to clearly show successes and contributions to the organization’s goals and missions. Good measures will also facilitate continuous improvement of SMM efforts. When budgets get tight or colleagues start asking, “What are we getting for the money?,” it is important to be armed with graphs, tables, and numbers that show the progress of the campaign and prove that social media is driving the organization’s objectives. Perhaps most importantly, good metrics will give clues on what needs to be done to improve efforts, so that social media managers can do a better job. For all of these reasons the group responsible for social media marketing will seek to work with management to set goals and metrics to measure the goals that are in line with the organizational mission.
Social media data is available from a variety of sources, much of it free and relatively easy to work with. There are measures available from the social media sites, web activity analysis from Google Analytics, and data from WordPress and other blog-hosting sites. Outside services such as SocialMention offer some data and analytics for free, while services such as Radian6, NetBase, Visible Technogologies, Lithium, Sysomos, and Cision offer subscription and custom analysis.
- Social Media ROI:Managing and Measuring Social Media Efforts Oliver Blanchard
- “Guide to Influence Measurement Tools” (research report from Realtime Reports, March 2012) by Tonia Ries
- Return on Influence: The Revolutionary Power of Klout, Social Scoring, and Influence Marketing, Mark Schaefer
This is part #5 of an excerpt about “Metrics” from an early draft of a text for teaching Social Media Marketing. Please do not copy without the approval of Flatworld Knowledge and Gary Schirr. I welcome thoughts on omissions, additions and corrections!!!