Similar to my personal point of view, Forbes has the same point of view - that there is no way ROI can be measured for social media.
However, that said, although it cannot be properly measured, I have to, unfortunately believe that estimation is still reasonable enough for the Return On Investment. Don't get me wrong, really.. I am still trying to convince myself that this can even be estimated at all.
Interestingly, I had even found this page, whereby it shared 14 Social Media ROI Metrics You Can Use Right Now!
Based on what I have seen around all-the-so-many-websites on ROI, so far,what I have concluded is that when it comes to Return On Investment and social media marketing, many organisations have found it rather challenging to connect returns with their social media investment.
Also, this other website, I must say that it did actually impressed me, with the social media ROI on the different types of components of the business that organisations might be interested to find out more about. For example, ROI on sales, ROI on Customer Insights, ROI on Customer support calls.
Photo credits by: Jeremy Victors
But, seriously, why do organisations want to bother with measuring ROI, since they have already decided to go ahead with the implementation, they should really just go ahead!- (If I'm the CIO, obviously.)
So, I believe at this stage, I am pretty convinced now, that ROI is definitely worth a measure and also would exist, given that it actually benefits many businesses - good or bad. My thought is that, if they were to track the incoming traffic on their website, they would have a good gauge of whether they have done the right thing by implementing social media or not. And if not, they will then be able to think of some other alternatives.
Some of the reasons why companies want to measure/estimate ROI:
- Negotiate budgets with your management
- Land prospective clients
- Retain current clients
Ah...I have found one fantastic one to share, off from this website. It said, "The most common social media measurement model used by marketers is last-click attribution, which assumes the marketing channel most responsible for a consumer’s behavior is the channel that the consumer last touched before visiting or making a purchase. It’s a model that’s been used since the days of email, search and other direct response online media channels. The model works well for these because it measures the behavior of customers who are further along in the decision-making or purchase funnel."
So yes, by now, if you were initially like me, I hope you are convinced that social media Return On Investment(ROI) can be measured/estimated.
Otherwise, let me know and I am sure I can very positively find further information for you. ;)
Interesting articles that I had found:
http://www.forbes.com/sites/ciocentral/2012/08/28/3-reasons-why-theres-no-measuring-roi-on-social-media/
http://www.text100.com/hypertext/2012/03/first-click-attribution-the-more-effective-social-media-measurement-model/
http://www.socialmediaexaminer.com/how-to-estimate-your-social-media-return-on-investment/
Hey Yvonne :-)
ReplyDeletefrom my point of view, ROI of participating in social media can be measured by many ways, just like u mentioned in the post, such as ROI on sales. A good example will be the Facebook fanpage, it is not difficult for customers to "like" your fanpage, but the key point is how to have them actively engage in the community, thus to improve customer retention, and further attract potential customers :-) I think the amount of "how many people talk about it" is an effective index of ROI, through the customers mentioning your product on their wall can produce tremendous marketing effects :-D
Have a lovely weekend :-)
Hi Edie,
ReplyDeleteyeah, I was really initially skeptical about the measurement of ROI for social media, but eventually got convinced after reading up more about it.
That is a good point, it is always easy to get people to 'like' your fanpage, but how to actively engage them, and also, to me, more importantly, retaining them, and keeping them interested.
I hope u have a lovely weekend too! ;)
Hi Yvonne.
ReplyDeleteROI for social media is really hard to calculate, specially when it comes to abstract concepts such as collaboration and knowledge sharing. Some authors have used the concept of ROC (Return of Change) and RoNI (Risk of not investing) which to me makes a lot of sense, since companies can lost money not adhering the social media trend. (more info http://www.frogpond.de/2009/02/discussing-measures-and-concepts-for-collaborative-performance/).
Charles
(http://charlestontelles.wordpress.com/)
Hi Charles,
Deleteindeed, it is difficult to calculate.
It is really quite interesting - RoNI - I shall check this out. THank you for sharing with me. !
Hi Yvonne,
ReplyDeleteCould using the Social Media Tracking tools mentioned in week 5 potentially be used for estimating the return on investment by knowing how many people are talking about your organization (via twitter for example)??
Hi Adam,
Deletethat is definitely possible.
Even if you are not using any of the Return on investment metrics, by using the 'ping' method like what was mentioned in one of the lectures, you can easily be 'informed' whenever your organisation gets mentioned.
Hi Yvonne,
ReplyDeleteThat was an interesting and informative post, I too was sceptical about whether or not social media tools could be measured or not until I went to the lecture and second, read your blog post :). I like the way that you structured your blog and the cartoon images were funny too.
Keep up the good work, and have a lovely weekend. ^^
Feel free to drop by my blog and leave a comment at http://calditz.wordpress.com
Hey Cal,
Deletethank you for the compliment, I am trying to share information as much as I can, with my own personal research, so that I can share the information with my readers too.
Hi Yvonne,
ReplyDeleteI am in the same mind set as you. I think that ROI calculation for social media is extremely subjective. People are struggling to find the correct metrics and I think that is because we are still in the infancy stage of what 'social media' is going to become. It will be less about calculating ROI and more about just having to incorporate it in some way because without it your business cannot remain competitive.
Hello Adam,
Deletethank you for reading my blog post.
I agree with you. Organisations are struggling to find the correct metrics. And to be quite honest, many organisations are just measuring their ROI based on monetary profits, and not considering about the non-tangible rewards like staff performance or staff productivity.
Great post Yvonne. I think there are some executives (CEO/CFO) out who might not prioritise an Enterprise 2.0 implementation over other operating costs or projects. This is when we need to present a solid case for ROI to get their buy-in. There are tools to measure social media success, such as Facebook Insights for Facebook fan page and Google Analytics for websites or blogs. I have covered these examples in my recent blog. Do check it out. :)
ReplyDeleteThanks Karen.
DeleteThat is pretty true. For those top management who are not convinced about the implementation of Enterprise 2.0, that is when their staff need to come up well prepared with the ROI and findings, in order to present to them, and for them to be convinced.
Another brilliant post Yvonne.
ReplyDeleteYes, i once worked with an organisation who is 'socially blackout'. The reason being that Executives were not convinced how implementation of Enterprise 2.0 would drive many of their business goals. In this experience i also learnt that if CEOs or employees are not speaking the same kind of language (2.0 language, culture), it can be very difficult to convince each other. So yeah, i agree with you that showing a practical report justification your ROIs would perhaps change the way people perceive the use of 'technology'.
Cheers and thanks for leaving a comment on my post too.
Thadreina
Thanks, Thad!
Deletewow..it must have been difficult to be working in an organisation where social media is not allowed, especially in today's society/world/times. I would feel pretty left behind myself if I was in your shoes.
Yeah, indeed. Only by being well prepared with the figures and only non-monetary benefits, will one then be able to convince the top management and get their support in the implementation for the 2.0 Tools.
Hi Yvonne,
ReplyDeleteInteresting read :) I particularly enjoyed the link you posted to Clickz 14 social media metrics. I think you're right in that businesses should incorporate social media and that it can generate a good return. I guess one of the big set backs for companies is that even with great metrics that are purely data-driven, there's still no 100% fool proof way to measure ROI on social media, but if your businesses social media presence is beginning to boom, it will almost certainly bring profits with it.
Thanks,
Mark Richardson.
Hi Mark,
Deletethank you for dropping by. Yes, indeed that Clickz 14 social media metrics was a great one. I really enjoyed that myself personally. And was further and very convinced that there are definitely ways to measure ROI for social media in organisations, although most of them focus on the monetary side of business, sometimes, measuring the non-tangible side is a pretty good idea too.