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Why Measuring Social Media ROI Matters (and why it doesn’t!)

Posted by: cmaeon in social media, ROI, conversation marketing on Sep , 2010

measuring cupsOne of the most important things any business is measurement. You have to know if you’re spending money wisely. We at CMAEON think it’s important too - so important we list Measurement as one of the three “Ms” you need to make your business effective.

However, the question that comes up a LOT is how can you measure the ROI on social media?  Are you reaching customers or just making noise?  Sure you can measure how many people are clicking your links thanks to platforms like Hootsuite, but how many clicks does it take? How many friends or followers are real, passionate brand advocates? How much do you have to engage before you make the sale?

Unfortunately, there isn’t a realistic scale for measuring how effective each click, friend or follower is. Each of those measures represents an individual.  As anyone in sales knows, everyone needs a different level of comfort before they are willing to buy your product.  So does that mean you can’t measure ROI at all? Is social media just a black hole?

Digital Media Analyst Brian Solis wrote a very in depth article about a study Bazaarvoice and the CMO Club recently conducted a survey on social media.
Almost all the Chief Marketing Officers surveyed indicated they wanted measurable ROI out of their social media strategies. 53% were unsure of their return on Twitter, and 15% believed there wasn’t any ROI. 1 in 10 figured there was no ROI from LinkedIn or Facebook.  HOWEVER, those same CMOs reported a 400% increase in twitter comments to inform decisions about products and services, a 59% increase in customer reviews and ratings and a 24% increase in the use of social media for pre-sale Q&A.

So… how can you know that people are talking about your product, but be unsure of the value of the medium where they’re talking about it? It all comes down what you’re actually trying to measure.

Driving a conversation around your brand creates awareness and back of mind recognition. It might not create a sale every time (or even every 1 in 100 times) but it provides value all the same.  If customers feel they can trust your brand and trust the people behind it, when they do want to make a purchase the awareness is there, no matter what the product. Every marketer in the world will tell you that brand awareness is something to strive for. You could make anything from software to soft drinks and still need to make people familiar with your brand.

So, of course you should be measuring social media! Measure it quantitatively: how many people are talking, where they’re sharing and who they’re telling. But keep in mind your social media goal shouldn’t be to drive sales, it should be to drive conversations and awareness. Social media is conversation marketing; it expands awareness, engages people and creates personal relationships between consumers and brands. The worth of a real, one on one relationship is almost impossible to measure, but that doesn’t mean it's not valuable.

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Why Google isn’t the Right Solution for Your Business

Posted by: cmaeon in google, conversation marketing, connected market space on Jul , 2010

Google makes a big show of their informal motto, “don’t be evil” and we believe them. Google after all, makes a lot of money on search but then uses it to give away fabulous services like Gmail, Wave, Google Docs, Youtube, etc, etc.
carnival fishingNote: This blog post has been adapted by the CMAEON staff from notes our CEO Tim Vasko wrote for his upcoming book.

Google makes a big show of their informal motto, “don’t be evil” and we believe them. Google after all, makes a lot of money on search but then uses it to give away fabulous services like Gmail, Wave, Google Docs, Youtube, etc, etc.

However, there is a little more than altruism involved. Each time you use a service like Gmail, and every time you visit a website with Google Analytics or Adwords on it, you’re giving information to Google. Why? They need your information for their algorithms - the same ones they use to drive their search and Pay-Per-Click Adwords. Is this evil? Maybe not, but you are paying for these services – one way or another.

Keep in mind what Google actually sells is clicks and awareness of options, that their machines (both algorithm and paid for click money machines) decide we should know about. Google connects people to the filtered information and then sends them away. This process is the big money maker for Google - tens of thousands of "optimizers" make sure Google sends the top front page searches to the businesses that pay a lot for that placement.

So, you can buy into the “Google Game” – an expensive game that's more like a fishing game at a carnival, and you might get clicks and you might not – it’s not really a game you can win. You want those people who search to connect to you, but Google doesn’t care if they do or not. Think about how many bounces, un-followed up leads and would-be conversations are just dropped… Yet businesses pay for this all day, every day, 24/7 – and Google makes a lot of money from this.

So how can you actually catch fish instead of just paying to cast your hook in Google’s pond? The first step in winning the “Google Game” is to start a conversation. Don’t let those leads bounce. Engage, talk and make a dialogue with potential leads. Why? Because that is how social networks, followers, and conversation marketing work – nurturing those leads into clients, one person at a time.

Sure Google is a tool, but it’s not a solution – a solution needs to do more for you. It needs to want you to succeed. Google doesn’t care if you win their game or not – the longer you play, the more money they make.

Picture: Dawn Perry, Flickr

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