How To Really Measure ROI of Social Communications

Social-media-for-public-relations1reduzidoToday I came across a whitepaper from Bazaarvoice, a leading social commerce solutions company. The report is called “Real ROI From Social In 5 Steps,” and provides a great set of options for decision makers trying to find a clearer value from social communications. In this post I’ll outline a few of the steps they provided, as well as a few of my own.

Follow the Money!

If you’re proactive in creating your social programs at the outset of a new campaign, you will be able to establish separate channel benchmarks. With data collected from these benchmarks, you’ll be able to compare A sales from your B direct marketing campaign against X sales from your Y Facebook campaign. It’s simple enough in theory, but many projects often consider adding social media only after heavy investment (of both time and money) into an existing campaign.

The facts support the importance of social for online shopping. Seventy-four percent of shoppers rely on social networks to guide their purchase decisions, hoping to see what others are experiencing with your product or service. Shopping has always been social; the Internet just offers a means to make it easier than ever. If you’re tracking conversions as a result of social campaigns and comparing them to traditional sales, you can measure ROI.

Use Content That Encourages Consumers To Buy

This is a basic idea that will probably take time to figure out; whether it’s a video, a funny meme created using your product or a very popular photograph of your product, publish the content that you know your consumers will find valuable. This could be new uses for the product that a consumer may not have considered, an informative demo that shows how your product works, or a super sexy, high-res photo of your product in action. The more skin you have in the social experience game, the more likely your consumers are to look at your product and drive your ROI.

Promote The Product As Your Consumers Promote It

There’s a reason what we’re talking about is called “social” media. Most consumers, depending on what your product is, love to show off their purchase and exhibit the unique and interesting ways they enjoy it. By fostering this sort of engagement and celebrating it when it happens, your customers will feel that your product is genuinely valuable. This could be as simple as thanking consumers when they share content with you, but is even more apparent when you utilize the content they’ve created.

Nearly two-thirds of consumers use search engines to help with product research when considering a purchase, so the more content you have out there convincing them to buy your product, the better off you’ll be.

Use Multiple Paths to Show ROI

Given the many variables you’re left to consider with any social strategy, focusing your efforts where they will give the greatest bang for your buck is key. For sales, this means having a hand at every point in the shopper’s journey, from research to retail. When you feel that you have a firm grip on your customers’ journeys, there is a simple formula you can use to determine the results:

Real return from social =
increase in transactions
x increase in revenue per transaction
+ total savings from decrease in product returns

If you followed the first point in this article, you should have a solid baseline to measure your social campaign against an average period of business. Combining the three variables in the equation above, you’re given a monetary value of your ROI that you can use to map the traffic from social channels to purchase paths.

References:
“Real ROI From Social In 5 Steps,” Bazaarvoice, April 2012
http://www.bazaarvoice.com/research-and-insight/white-papers/Real-ROI-from-social-in-5-steps.html

“Gartner Says Majority of Consumers Rely on Social Networks to Guide Purchase Decisions,” Gartner, July 2010
http://www.gartner.com/it/page.jsp?id=1409213

“How We Shop in 2010: Habits and Motivations of Consumers,” eConsultancy, July 2010
http://econsultancy.com/us/reports/habits-and-motivations-of-consumers

Images:
Wikimedia Commons

Setting Benchmarks for Social Media

Recently, I’ve been tasked with defining benchmarks for a number of clients who are interested in utilizing social media, and others that already have a presence but would like guidance on how to find a common ground for their messaging. I’ve become fairly proficient at analyzing communications online, and below I’ll share some of the ideas that have helped me explain to clients the need for a clear message through social media. These are, essentially, step by step instructions on how to approach your brand’s online identity.

Research Effective Social Media Program Drivers

In order to understand how your brand’s social media channels should be used, a “landscape analysis” can determine how competitors engage with consumers online. Such analysis can identify a recurring driver such as loyalty, awareness or customer service, i.e., the metric that your competitors hope to increase using online channels. Perform a simple search for your competitors’ profiles, take a look at what content they post and how often and take a rough measurement of how engaged they are with consumers.

Determine Audience Relationship with Your Brand

As part of any social media rollout plan, it is important to determine congruencies, develop a plan of attack, and define a common message that will be promoted to your key consumers.

Will you provide information based on your industry? Will you offer promotions and giveaways? How involved will you be in consumer conversations of your brand?

You should examine these questions in order to classify who you will be engaging with online. Engagement groups are usually based on consumer brand loyalty and awareness, defined by a hierarchy of:

  • Those who know nothing about your brand
  • Those who are aware of your brand but have not purchased your product/service
  • Those who have purchased your product/service only a few times
  • Those who are repeat customers or enthusiasts
  • Those who are advocates for your brand

Determine Audience Involvement on Social Media

If your brand is already using social media, you may need to first analyze how your communications have developed thus far. For example: if you find that you have been interacting with an older segment of consumers, the cohesive message developed should adopt a more professional, informational tone. If the audience is a younger group, you can design messaging and content that takes advantage of trends and pop culture. Beyond demographics, you should determine how your consumers contribute to online conversation. This can be described in Forrester’s Social “Technographics” Ladder:

Determine a Suitable Tone for Your Brand in One-On-One Communications

For the general audience of social media users, engagement is divided into two silos: fun and information. Users approach social media as a means to converse with brands and seek promotions (fun) or to learn about a topic and seek others’ opinions (information). Research can determine which role your brand’s social media communications should pursue.

Brand “Anthropology”

Once you have your audience defined, the next step is to look within. What is your brand’s identity? What individualizes the brand? If you can answer these questions offline, expanding to social media will be relatively simple. Having the ability to answer these questions creates a presence of credibility and personality for your company, which some the world’s most successful brands utilize. To illustrate this point, here are a few examples from other brands:

  • Apple = Innovation
  • Wal-Mart = Savings
  • Volvo = Safety
  • Nordstrom’s = Personalized Customer Service

I hope this info helps you define you or your clients’ goals on social media! As you’ve probably heard before, social media is a conversation. Listen to your customers, and they’ll tell you what they want to hear.

U.S. Census: How will marketers respond to U.S. Hispanic growth?

The 2010 U.S. Census, a count of all people living in the United States, shows that the Hispanic population now comprises 16 percent of the country’s total. As reported in a story by the NY Times, Hispanics are now responsible for more than half of population growth in the nation over the last decade, increasing 43 percent from the 2000 census.

Surely, as marketing budgets and programs are planned, greater weight will be given to addressing the communication needs of the Hispanic population. Communications professionals specializing in this audience have an opportunity to seize the moment and educate organizations on how to effectively reach Hispanics and dispel misconceptions.

One common misconception is that once bilingual Hispanics master the English language, they become “acculturated” and use English as their primary language. While the majority of U.S. Hispanics do speak English well, Nielsen reports that 61 percent of Hispanics aged 18 and older prefer to speak Spanish in their homes versus only 17 percent who say they speak only English. In family conversation and media consumption in the home, Spanish language remains important even after English proficiency is achieved.

Beyond language preferences, Hispanics are more receptive to targeted advertising, mobile advertising and new technology adoption than the general U.S. population, as a Scarborough Research report in 2010 has shown. Hispanics are also more likely to own a smartphone and use it to access mobile Internet, text messaging and e-mail.

Above is one of my personal favorite examples of marketing effectively to the U.S. Hispanic consumer, the “Somos Muchos” campaign from Toyota and Hispanic ad agency Conill. I think it’s a great example of a top-to-bottom campaign designed for Hispanics and Latinos, which clearly paid off for Toyota.

Thanks for reading!

References:
“A Growing Population, and Target, for Marketers”, NY Times
http://www.nytimes.com/2011/04/05/business/media…

2010 U.S. Census
http://2010.census.gov/2010census

“What You Think You Know vs. What You Need to Know About U.S. Hispanics And Media”, Nielsen
http://blog.nielsen.com/nielsenwire/media_entertainment/what-you-think-you-know-vs-what-you-need-to-know…

“Hispanics Are Important Mobile Marketing Targets”, Scarborough
http://www.scarborough.com/press_releases/Hispanic… (PDF)

Video: “Toyota Wins Back Hispanic Drivers With 259,000 Decals”, AdAge
http://adage.com/article/hispanic-marketing/toyota-wins-back-hispanic-drivers…

Internet Killed the Salesperson?

In a day and age where an increasing amount of business is being conducted online, many industries are finding themselves unable to cope with the costs associated with implementing internet business strategies. The troubles have been clear for many industries including newspapers, textbook publishers, record companies, etc.

In a recent blog post mentioned by one of my professors, automakers have noted a decrease in the auto sales among Generation Y consumers. Some believe this drop has been caused by the popularity of social media, apparently creating an ease in friends’ connecting and carpooling to various locations together. They also note teens’ and twenty-somethings’ increased desire for electronics and other goods, which often tie up their income. Just as the rest of the nation, however, Generation Y is being hit hard by this “Great Recession.” With jobs being lost, hours being cut and tuition costs on the rise, many of us are being forced to cut back and simply cannot afford the costs associated with acquiring a car.

The internet does, however, create a new medium that sales personnel must utilize in order to maximize sales. Generation Y consumers are a unique segment. In order to create a lasting marketing campaign among this target it is essential to use cutting edge tools, such as those available through online and mobile APIs (Application Program Interface) that can be tied into brand value.

One of my personal favorites is Foursquare, a popular new app that combines GPS, reviews and ratings to provide you with a snapshot of what your friends are up to tonight. Upon arriving at a new destination, users can “check-in” to that location — be it a gas station, a restaurant, a theater, a nightclub and so on. Users can leave tips on this location’s home page, invite friends to attend, and post their check-ins to Facebook and Twitter. Upon checking into Sergio’s, for example, Luis E. would recommend you try the pollo empanizado! It’s free brand support such as this that is truly exciting in terms of marketing potential.

So while some industries might complain that the internet is driving away business, in reality I believe consumers are simply looking for more interactivity. For example, as newspapers are struggling to stay alive it’s not as if people simply don’t pay attention to the news anymore; they’re just going online to view it for free and at their own leisure from any computer, smart phone or laptop. The internet isn’t killing sales — it’s simply changing the way companies must approach it.

References:
“Carmakers’ next problem: Generation Y”
http://www.msnbc.msn.com/id/39970363/ns/business-autos

“E-Marketing for Sensible Folk”
http://e-marketingforsensiblefolk.blogspot.com

“Application Programming Interface”
http://en.wikipedia.org/wiki/Api

Foursquare
http://foursquare.com/about
http://foursquare.com/venue/11751

Image:
http://commons.wikimedia.org/wiki/File:Texting.jpg

Information, the Internet and Government

One of the primary topics I cover in this blog is the amazing change we can observe in information search and retrieval. We’ve only reached the tip of the iceberg in utilizing the internet for daily activities including studying, finding recipes, purchasing used furniture, contacting a friend in Hong Kong, donating to an orphanage in Moscow, and so on and so forth.

It’s these new advances in technology that are sending ripples throughout factors of our daily lives, simply because we are a society based upon information. The information we place — and have access to — online grows exponentially each year. It is with this surge in the availability of data that entire businesses have been designed to streamline the process: Google AdWords, Facebook, Amazon, etc. With this shift in power from manuscript to “140 characters or less,” even governments are taking action. Just this past summer, the United States Library of Congress announced it would be archiving all Tweets in order to record how our society is maintaining communication and interacting.

Stories such as these do raise some concerns, however. Namely, how much information do government entities have access to? How might this information be used in an unethical manner? These concerns are legitimate, and we need to take a close look at how information search and retrieval is changing in order to understand what troubles might lie ahead.

References:
“Library of Congress to Archive Your Tweets”
http://articles.cnn.com/2010-04-14/tech/library.congress.twitter_1_tweets-micro-blogging-twitter…

Mapping Out Business Success

In a marketplace that is constantly evolving, how do you ensure success? How do you keep up with demand? How do you keep track of industry trends?

Business planning is a simple prospect – establish a set of criteria that will allow your organization to create a road map of where you’d like your business to grow and dominate the competition. However, many organizations fail to plan their decisions in this manner and soon find themselves stuck in a hole, with mediocrity crushing down on them. In order to excel in any industry, here are some focal points  believe any company should pay close attention to.

Customer Service: When it comes right down to it, a core function of business is to provide a product or service. Without proper utilization of customer service skills with consumers as well as suppliers and partners, it is difficult to maintain steady financial development. The latest trend, of course, is social media. Companies use social media to interact with their customers on a personal level, and find out what trends they’re looking for or shying away from. Research is now showing that use of social media drives face-to-face interactions. When customers interact with your brand outside of a sales atmosphere, it can humanize your marketing efforts in a way that allows for much more effective campaigns.

Quantify!: Another simple concept that is often overlooked, quantifying goals and progress can allow an organization the ability to understand exactly where they stand, and more importantly, present that data to others. Shareholders, donors, investors and often time customers themselves all need to know precisely where their funds are being used. If you can’t definitively disprove the image that any money invested in your company or project goes under your grandmother’s mattress, then it’s time to rethink your business plan! Get out there, conduct marketing research, create new findings and see what your customers are saying. If you back up all decisions with quantifiable objectives, it will be much easier to complete them on time.

What are some other points you believe are key to maintaining success?

References:
“New Research Dispels Interactive Marketing Myths…”
http://www.exacttarget.com/company/news/Article-View/ArticleId/432/New-Research-Dispels…

“Social Media Humanization”
http://www.socialmediaexplorer.com/2010/10/06/social-media-humanization

Image:
http://commons.wikimedia.org/wiki/File:Nederlands_verkeersbord_L6.svg

What’s the Price of Your Privacy?

As I mentioned in my last post, advances in technology are making it more enticing for marketers and advertisers to take a peek into the trends you follow online. With the help of technology such as cookies and online social networking profiles, marketers are now utilizing what is known as behavioral targeting, whereby information on your mouse clicks, interests and searches made is collected and used to create integrated advertising that is unique to you. While many see this as a great way to follow the current trend of niche markets and individualized marketing, others see it as a huge disrespect of privacy. Taking this into account, you might want to think twice before “Like”ing that popular DJ’s page on Facebook, lest you be flooded with promotional ads for lame night clubs on South Beach.

Recently, new changes have been put forth in attempt to abate future legal troubles due to this so-called encroachment on private information. Online companies will have the chance to include a hyperlink near data-collecting portions of a website, which links users to a website listing more information on the practices used to collect this information and what it means to consumers.

Personally, I’m not so sure I buy into these privacy concerns. Is it really so frightening that Facebook knows that I enjoy listening to Radiohead? Or that I like Thai food? While the threats of online identity theft and harassment are certainly real, I would never think to put any personal information online that I don’t already consider public in the first place. In today’s day and age, it seems privacy is only a topic we discuss after we feel it has been violated — even though, for many electronic media, we fail to fully understand the policies in place for these sorts of concerns. Have you ever seen the length of an iTunes contract? Do you really sit and read through it in its entirety before downloading that Taylor Swift CD? I don’t think many do.

What does online privacy mean to you? Do you feel this new AboutAds initiative will help consumers become more knowledgeable?

References:
Wikipedia
http://en.wikipedia.org/wiki/Behavioral_targeting

Image:
http://www.allfacebook.com