Two reports circulating this week got me thinking about social media ROI – survey data from Mzinga and General Sentiment’s Media Value Report.
Take-aways: 1.) we aren’t there yet – social media adoption is now mainstream, but measuring value & ROI is lagging. 2.) There are several methods marketers can and should use to quantify the value of social media (a few ideas follow).
The Mzinga survey shows that we aren’t there yet - 79% of respondents are not measuring ROI in any social media programs. Not all companies will be ROI driven, many will be branding driven. However, all companies will seek to assign value to their social media marketing efforts and compare to other channels.
5 Ways to Measure Social Media Campaign Value:
1.) Equate to Cost per Click. I had a recent conversion with Warren at Lift9 about this method gaining ground. It is a simple approach – track clicks, tie your campaign to keywords, and use keyword CPC market rates to estimate the traffic value.
2.) Equate to Cost per Impression. Calculate the impressions generated from your campaign and apply the market CPM rates to reach the same audience with a traditional media buy.
3.) Track to eCommerce Transactions. On an ecommerce model, you can track social media campaigns to purchase with a specific coupon code and web analytics. Dell does this, and many airlines, hotels, and online retailers are using this approach.
4.) Survey your Customers. Why not ask your customers to qualify the impact of your social media campaign? Did it impact their awareness or decision making process? With a few assumptions, these insights can be modeled to value.
5.) Tie to Established Internal Metrics. Are you reducing churn? Are you increasing the lifetime value of a customer? Customer satisfaction? Can we start to draw a line from social media efforts to a well established operating metric?
General Sentiment’s report takes an impression driven approach by looking at the volume of buzz about a brand and their products and the sentiment. They found the following value for the top brands:
We spend our time looking specifically at how Twitter campaign analytics can be used to model value. What other approaches do you think are effective for measuring social media value?
