Many organisations are shunning the use of social media from their communications campaigns because they claim they can‘t measure its value. It is fine to choose not to use a medium because it’s not appropriate for your business, but to simply write it off because you can’t work out how useful it might be, is sheer stupidity. Surely we can apply traditional marketing metrics to social media to calculate a Return on Investment? Here’s how I think it can be done…
Firstly we have to work out what it is we want to measure in order to calculate the RoI. Is it quantitative information such as the number of referrals to your website from Twitter, or the number of vouchers printed from Facebook to use in your restaurant? Or is it qualitative information such as how customers feel about your corporate social responsibility programme, or attitudes towards your brand?
Once we have established what is important to us we need to set targets for achievement. At the moment, with social media still relatively young compared to say TV advertising, we may need to have rather fluid objectives that we accept might change slightly over time. We can benchmark against competitor organisations to see how many ‘friends’ or ‘followers’ they have, as after all, social media provides a transparency like never before.
The next step is to do the actual measurement. Google analytics (and others I’m sure) can measure the quantitative data for you. And the advantage of so many Web 2.0 tools is that they are free to use. In terms of the nitty-gritty, the ‘why’ our customers do what they do, or qualitative information gathering, we can measure with traditional market research tools. Focus groups and in-depth interviews are still credible research methodologies and there’s no reason why we can’t ask customers about their use of social media via these routes.
The final stage is checking and balancing. With all our marketing activities we need to assess and evaluate what we’ve found, set new targets, make changes and then repeat the process.
I think the organisations that are running scared of using social media are those that probably don’t measure their other marketing activities. As long as you understand what your customers want, there is nothing to be afraid of when it comes to social media. And to be honest, I think it’s quite fun too.