Measuring Your ROI On Social Media

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1 Measuring Your ROI On Social Media

2 So What? * Measuring what matters means measuring relationships * All transactions conducted today are still driven by relationships * Building, managing, and measuring those relationships are fundamental to your success and success of organization Notes taken from one of my favorite measurement books: Measure What Matters by Katie D. Paine

3 Measurement * Listening/Analysis/Reporting tools = affordable/accessible metrics * All organizations have core set of key public AKA stakeholders * Companies that listen and respond (real time marketing) will survive and prosper * MUST continuously listen and evaluate your market- what are people saying about you.

4 Measurement * Terms * Counting- add things up and gets totals * Measurement takes those totals, analyzes what they mean, and uses that meaning to improve practice * Not the quantity that matters- its quality of relationship * Good relationships lead to profits * average corporation spends average of 4.5% of its marketing budget on evaluation * 79% of organization aren t measuring the ROI of their social media efforts at all

5 Why measure???? 1. Data Driven Decisions Making Saves Time and Money 2. It helps allocate budget and staff 3. Gain a better understanding of the competition * Helps you stack up against peers and rivals * Gives you insight into competitive strengths and weaknesses 4. Strategic planning * Data you can rely on to guide your decisions and improve programs 5. Measurement gets everyone to agree on desired outcome * Real reason metrics don t exist is that no one ever articulated just was the s.m. programs was designed to do 6. Measurement reveals strengths and weaknesses * CPMC = cost per message communicated 7. Measurement gives you reason to say no * If you have data on results of previous programs you gain leverage to turn down requests that we be waste of time or resources

6 Dispelling Myths of measurement * Measurement = punishment * Most people who institute measurement programs find they get promotions because of their ability to identify strengths and weakness and allocate resources intelligently * Measurement will only create more work for me * Once measurement system is in place, it makes everything else much easier * Data is a great resource and helps ensure max impact * Measurement is expensive * Without measurement you don t know if you re spending budget effectively. * Measurement is strictly quantitative

7 Dispelling Myths of measurement * You can t measure the ROI, so why Bother? * ROI = Return on Investment * How to you calculate ROI? * Total amount of money save or brought in and subtract total budget amount invested, then divide it by cost of investment * Measurement is something you do when program is over * I know what s happening, I don t need research * Could be more effective if understood the true value of measurement.

8 Getting Started * Baby steps best, start with pilot program * WARNING: * Eventually you ll step on toes/challenge traditional wisdom/get push back * Base your conclusions and recommendations on real data=fact are on your side

9 10? s every communication professional must answer 1. What are your objectives? * Objectives must be measurable 2. Who is the target audience? * Define audience as specifically as possible * Priority public is most profitable and most valuable 3. What is important to your audiences? 4. What motivates them to buy your products? * Most important question for measurement program cause with determine what you measure 5. What are your key messages? * Should reflect what makes people attracted to you and what distinguishes you from competition

10 10? s every communication professional must answer 6. Who influences your audiences? 7. How do you distribute your product or service? 8. What are you going to do with the info you get from research? * Never ask a question you don t want the answer * Make sure you can act on info you get and can make changes and improvements as a result 9. What other departments or areas will be affected? * Need buy-in from everyone involved 10. What other measurement programs are currently underway? * Use your research!

11 Reaching MEASURABLE objectives * Understand your background * Assemble everyone on team * Write down and probe to find out what people really mean * Ask everyone what their objectives are * Once you have all objectives and metrics set priority By getting everyone to agree on a standard definition of success, you can easily judge performance and how you stack up to competition

12 Ensuring Accurate Data- 4 bad data reasons 1. Incomplete assessment of variables 2. Relevancy of content 3. Commercial services omit results 4. The (in)accuracy of content analysis

13 Notes * Very common to undertake some preliminary research to help you with the first few steps * Doing smaller study introduces everyone to process and advantages of the data it generates * Define Benchmark * Benchmark study is preliminary research done to learn about audience or environment OR to set goals for future projects * Benchmark to compare against is a standard against which you measure progress toward goals

14 Step 1: Define Goals and Objectives * Campaign must include desired outcome and the deadline * Ideally budget and target audience too * Answers should relate back to strategic corporate goals * Most marketing goals fall into 1 of 3 categories 1. Sales 2. Message or positioning 3. Public safety or education * Separate objectives for each specific population

15 Step 2: Define environment, audience and role in influencing them * Examine each individual audience * Answer these two questions 1. How does a good relationship benefit the organization? 2. How might a bad relationship threaten it? * Tie communications activity back to sales

16 Step 3: Define your investment * What will it cost? * What is the level of personnel time? * What is the opportunity cost? * Are you adding resources or shifting them and what are the consequences? * Spend 5-7% of marketing budget on measuring that program

17 Step 4: Determine your Benchmarks * Measurement is a comparative tool * Benchmark against 2-3 competitors * Stretch goal * Peer company * underdog * Compare your company to its past performance

18 Step 5: Define your key performance indicators (KPIs) * Each objective may require different type of measurement and different KPIs * Awareness vs. Visibility * Awareness: person's knowledge of brand or message * Only measured by survey * Visibility: volume of coverage or where the story appeared

19 Step 6: Select the right measurement tool and vendors * Measurement tools are the techniques you will use to collect data * Most cases collecting data by: * Content analysis * Primary research * Web analytics * Tools must collect right data, be affordable and provide data when you need it

20 Step 7: Turn Data into Action * Measurement is continuous improvement process * Learn to translate raw numbers into charts and graphs with short headlines * Set up a regular reporting schedule

21 5 ways to measure ROI * How do you determine the return? 1. Sales or revenue 2. Cost savings 3. Paid vs. earned search rankings 4. Cost avoidance 5. Social capital

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