Social media: Driving profits or popularity?
Nothing has generated more buzz or brought more scrutiny than social media – and how to get more value out of it. It's gratifying if consumers like you on Facebook. But do they buy? Do they recommend? Does all the awareness, website traffic and goodwill your company is working so hard to generate translate into dollars and profits?
If you have lots of online traffic, that's a good indicator, right? No, says Katie Paine, CEO of KDPaine & Partners. "'Hits' stands for 'How Idiots Track Success.' If all you're doing is counting hits, you're not tracking anything that's meaningful in today's marketplace."
"Organizations realize the benefits of social media as it relates to awareness, but now the question is how to link this to tangible value in the company in a way that starts to justify the investment," says John Bastone, Global Customer and Media Intelligence Manager at SAS.
So how do you prove the bottom-line value of this ephemeral new media? Paine and Bastone share five best practices for getting the most from social media measurement:
1: Consider all the ways social media can drive profits.
"Social media as a channel tends to be most strongly aligned with marketing or marketing communications," says Bastone, "but its impact is reverberating across the enterprise. Many different groups have a vested interest."
The most obvious business functions that can benefit from social media tracking include:
Online media analysis. Where are consumers talking about you? How is volume trending? Who are the most influential sources? Which sites are more positive? Negative?
Brand and market tracking. What do consumers say about your brand, your products and your competition? What is the impact of these discussions? Who are the influencers?
Public relations and reputation tracking. What are online journalists and bloggers saying about your organization? What is the threat to your reputation? Where are the opportunities to build advocacy?
Customer feedback management. How do perceptions voiced on social media compare to direct customer feedback from other sources? Are there issues that require response or resolution?
The key is to create business processes whereby information from social media is translated into action. Customer complaints should be funneled to a customer care center. An identified need can be routed to a sales contact. An influential blogger can be referred to the public relations department as a potential new media contact.
The first thing you have got to understand is this: It's not about you. Too many marketers think social media is just another way to get the word out ...
Katie Delahaye Paine
CEO of KDPaine & Partners
2: Know what you want out of social media.
"Everyone tears their hair out and says, 'There are no benchmarks in social media.' But that's not really true. There are. There's always your competition – your peers – that you can benchmark against," says Paine.
Define the R in your ROI. To be able to prove the ROI, you have to have a tangible business goal to begin with, says Paine. What is the return that you're hoping to deliver? Why are you doing this? What is the problem you are trying to solve?
Define the audience. Who are you really trying to reach? It's one thing to go out there and reach 57 million people, but that's not very meaningful if those 57 million people are not really your target market.
Establish benchmarks. Define your Kick Butt Index. "What do your bosses define as 'kicking butt'"? asks Paine. "Find out what causes them to say 'Congratulations, you're really kicking butt out there,' or, 'Hey, we're really getting our butt kicked.' What are those metrics? If executives agree to this up front, you have a tangible way of proving the value later," says Paine.
"Marketers are having to make an adjustment to account for the fact that the 'social' part of social media demands a give and take," says Bastone. "As online conversations about your business are happening, you need to not just talk about yourself, but engage people in a two-way conversation."
Paine agrees: "The first thing you have got to understand is this: It's not about you. Too many marketers think social media is basically just another way to get the word out, when in fact it's a very different entity. The entity is the conversation."
There are lots of ways to use social media not just as a way to get the word out there, but to touch customers and interact in ways that you couldn't do before, says Paine. Savvy marketers will use social media to engage customers with the brand on a personal level, conduct customer meetings, gather feedback through surveys and focus groups, and identify opportunities for business development.
When Paine posted on Facebook that she was planning to build a brick walkway that weekend, she received a comment from Home Depot with a link to an instructional video about how to build brick walkways. By offering to help as a trusted adviser – rather than making an overt sales pitch – Home Depot ended up scoring the bricks-and-mortar sale – literally.
4: Forget about impressions and hits.
"For too long, we have been focused on counting eyeballs, and there is no way to count eyeballs effectively, consistently or accurately in social media," says Paine. "So just give it up."
Paine uses a five-level hierarchy of measurements, with each tier offering progressively more engagement – a more meaningful measure of how well you're doing with social media.
At the lowest level are the simple, descriptive facts comparable to impressions in traditional media: how many followers, friends, likes, visitors, hits, comments, etc. "Impressions are a zero level of engagement," says Paine. "You don't care how many eyeballs you reach; you care what those eyeballs have done," which brings us to the next level.
Did they go to your site? Did they click through from the link you gave them? I classify likes as a Level 1, because it's so easy to hit that like button," says Paine. "My metric is not how many likes there are, but how many likes there are relative to how many people actually engaged in conversations on the site. Maybe 98,000 are likes, but if only 20 or 30 people are actually engaging in conversations, that's not exactly a high level of engagement."
Most organizations are measuring at the more participatory Level 2 or 3, says Paine. "If you are really good at getting engagement levels up there, you'll get people who retweet, repeat comments and share posts. That's a very high level of engagement. Ultimately (Level 4) you want their identity; you want them to register in some form, say nice things about your brand, and (Level 5) make a purchase and recommend you to others."
As you move up the levels, the numbers will likely be small for now. It's important to set management expectations appropriately. The absolute numbers – how many click-throughs or visitors – are not nearly as important as what percentage of people are moving up the levels. From month to month, as social media followers and friends move from Level 1 to Level 2 and up, you'll know how well you are doing in getting people to engage with the brand.
5: Blend social media data with internal data.
"Social media is a hot channel for understanding and interpreting online conversations, but it isn't the only source of conversations," Bastone says. "If you really want to evaluate sentiment, conversations, topics, what people care about or don't care about, it doesn't make sense to analyze social conversations in one silo and other customer communications in a completely different silo.
"It gets really interesting when you start to blend social media data with internal data, such as the sentiment captured from call centers, surveys, customer service records, behavioral data, online chat and customer emails." Supplement with external customer research, brand research and Web analytics to create an even richer view of the customer.
"Bringing this all together gives you a common lens to understand customer conversations and sentiment – and a much better handle on leading indicators," says Bastone. "If an uptick happens across channels, that's a more reliable insight to use as the basis for forecasting and other business decisions."
Bio: Katie Delahaye Paine is CEO of KDPaine & Partners
John Bastone is Global Product Marketing Manager, Customer Intelligence at SAS
Why should you care about social media?
- 800 million active users on Facebook.
- 200 million registered on Twitter.
- 100 million professionals on LinkedIn.
- 80 percent of Americans use social media every month.
- 44 percent of junk mail goes into landfills unopened.
- Less than 1 percent of emails are opened and acted upon.