Return On Investment or R.O.I., has always been a challenge for Marketers. R.O.I. has been a mainstay term in the Consumer Packaged Goods industry since the birth of CPGs. R.O.I. is a mantra being uttered daily by Brand Managers at P&G and Colgate-Palmolive, but took a while to seep into other industries. It’s a term that was and is a bit scary for marketers…the accountability of being tied to real results. But the biggest challenge is being able to establish metrics and measure those results.
Enter Social Media…
Yesterday I was at a meeting where Savvy was being vetted to work with a variety of brands, including CPG companies. We were being vetted by a Search Consultant of sorts. We were asked many questions about how we measure social media, what types of software we use (we use a mix of proprietary and free tools), how we develop metrics and what our POV is on metrics — there were especially interested in how we present metrics to clients.
Savvy’s POV on metrics is quite clear, but what’s important in terms of discussing metrics is the context in which you are marketing a brand. The first is, not looking at Social media as a standalone marketing tactic, but rather as an overlay and an integrated element of your marketing plan. In a recent interview, Mitch Joel made these 3 great points:
- Digital channels shift the marketing focal point. Social media and other digital platforms now enable brands to focus on who, rather than how many people, they can put a message in front of.
- Think “with” not “instead of.” Companies should not halt what they are currently doing and shift all attention to the digital world; it’s all about effectively integrating those social media channels with what you already have in place.
- Don’t underestimate the “power of lazy.” We still live in a world where many people prefer to consume, rather than create, digital information.
So, now that we’ve looked at how to think about social media as a marketing tactic, we’re now back to thinking about ROI.
In an article that I referenced last week that had some great arguments about approaching ROI in social media, there are a few things that I feel strongly about on how a brand can measure ROI.
First, define clear objectives for the social media strategy. What other marketing are you doing? How is your social media strategy integrating with your plans — including your PR plan? Who is your target demo? What do you really want to accomplish? Be granular. Get deep. Really think about it. Generic objectives are like “Sell more cars.” A more specific objective would be “Sell more red, automatic, 4WD cars to moms living in the northeast with a household income of $60K+”. You get the picture.
Second, define what success means to your brand. Is it about gaining influential followers, establishing solid relationships with industry bloggers, is it the quality of the conversation (and what does “quality” mean to your brand) or is it 1,000 wall postings? You need to decide how you want the medium to work for you (while creating a very, unique experience for your audience. That’s key!)
Third, find a compelling offer or promotion that you can track. Don’t be afraid to offer a coupon, or better yet, do what Toys ‘R Us is did for Black Friday by previewing their 80 page catalog and launching mystery deals on Facebook, 2 days prior to Black Friday. Brilliant!
Now, social media isn’t just about offers, promotions and previews, it is about community and relationships. It’s about long-term commitment, not a one-time stunt. It’s constant, continuous, requires a plethora of resources, but provides a myriad of opportunities for R.O.I.