Social Media ROI Making the Case for Social

Justin Ramers Director of Social Media

Agenda

• Social ROI Overview

• Getting Smart About ROI

• Indentifying Key Metrics

• Determining Value

• Building Business Cases

• Q & A

Social ROI

“Marketing without analytics is like running a race without a timer.”

If you don’t measure results, how can you know if you are successful?

Blind Faith

• 84% of organizations do not measure social media ROI

• Easiest to measure compared to TV, newspaper, radio, etc.

• More than 40% of respondents said they didn’t even know whether they could track ROI from their social tools

• Peer pressure: adopting technology without knowing how it will impact your business and what value it will add

Why it’s Rare

• Marketers believe that measuring true ROI for social media is difficult

• There are so many metrics available that it is difficult to choose which ones are the most important

• Marketers do not start with clear objectives for using social media

• Emerging technology adds to confusion and complexity

“Our @DellOutlet (account) is now close to 1.5 million followers on Twitter... and (has) earned $3 million in revenue. In total, Dell’s global reach on Twitter has resulted in more than $6.5 million in revenue. In fact our Brazilian and Canadian accounts are growing rapidly too – and it was Canadian tweeters who asked to make sure Dell Canada came online to Twitter. Dell Canada responded because the team heard our customers. In less than a year, @DellnoBrasil has already generated nearly $800,000 in product revenues. Similarly, @DellHomeSalesCA has surpassed $150,000 and is increasing at notable pace.”

Case Study – Dell Outlet

Lionel Menchaca Chief Blogger, Dell

“When I’m asked about the ROI for Social Media, sometimes an appropriate response is… What’s the ROI of your phone?”@equalman

Social Media is a communications vehicle

Getting Smart About ROI

The S.M.A.R.T. approach to Social ROICredit: Garry Przyklenk

Getting Smart About ROI

Get SMART

Engage & interact with your customers through social media channels. Create conversations

around your event or product.Credit: Garry Przyklenk

• Socialize• M• A• R• T

Get SMART

Listen to multiple sources & monitor the conversations around your brand. Understand

the consumer sentiment.Credit: Garry Przyklenk

• Socialize• Monitor• A• R• T

Get SMART

Analyze your social traffic using free or paid tools. Quantify the impact of your efforts and

identify key trends.Credit: Garry Przyklenk

• Socialize• Monitor• Analyze• R• T

Get SMART

Report on real metrics like revenue, orders, leads, referrals and calculate ROI.

Credit: Garry Przyklenk

• Socialize• Monitor• Analyze• Report• T

Get SMART

• Socialize• Monitor• Analyze• Report• Target

Continually refocus your efforts based on the data and insights from the previous steps.

Credit: Garry Przyklenk

Indentifying Key Metrics

“Metrics are only as good as the people that determine them.”

Figure out the things that provide real value to your business.

Active’s Challenges

• Aggressively leverage social media without any proven results or case studies

• Get buy-in from upper management

• Quickly illustrate value

• Prove that model is scalable

• Make case for budget that doesn’t exist

• Understand what resonates with our audience and what doesn’t

• Demonstrate actual value, not theoretical

engagement - sentiment – reputation – differentiation – interaction - risk reduction – client retention – branding – perception shifting – exposure – customer satisfaction – trust building – social impressions – viral coefficient

Social Metrics

• Grow total network size

• Drive incremental visits

• Drive incremental conversions

Visits & Conversions

Key Metrics

Measuring Results

http://www.active.com/fitness/Articles/The_Best_and_Worst_ Exercises_for_Bad_Knees.htm?cmp=16-5195

• Unique tracking code appended to every social media post

• Tracks visits (clicks) from social media all the way through to pageviews & orders

• Combined with Facebook analytics, we are able to accurately report on subscribers, visits & orders

Sample Metrics

• Total network size/subscriber base

• Website visits

• Orders/transactions

• Leads

• Referrals

• Phone Calls

• Customer support resolutions

• New accounts created

(Visits) * (Pages/visit) * (avg CPM / 1000) = Advertising value created

• Assign values to each key metric

• Use real money values; estimate if need be

• Start at the end & work backwards

• Determine value independently for each channel

• Roll up channel data to see the global picture

Determining Value

Calculate Value per Unit

(Value created) / (# Subscribers) = Value/Subscriber $18,429 / 160,787 = $0.11

• Calculate total value created for each channel based on values assigned to each key metric

• Calculate the total subscriber count for each channel

• Divide value created by subscriber count to determine value/subscriber

• Calculate each month and compare data

Key Metrics Jan Feb Mar Apr May Jun

Network Size 53,325 62,688 96,054 111,840 123,381 137,907

Visits 71,134 81,249 155,748 130,137 160,028 162,001

Visits/Fan 1.33 1.30 1.62 1.16 1.30 1.17

Revenue/Fan $0.10 $0.14 $0.09 $0.05 $0.10 $0.09

Active.com267,907 Fans (as of Jul 1, 2010)Active.com is the 

leading 

online 

community 

for 

people 

who 

want 

to 

discover, 

learn 

about, 

share, register for and ultimately participate in activities about which they are passionate.

Social Media Channel Profile

• Provide market insight & relevant case studies

• Project short & long term impact with trending data

• Use real data to validate hypotheses

• Illustrate impact to the bottom line

• Justify increased development efforts

Building Business Cases

Why are they doing it?

• Customer acquisition

• Viral marketing

• Communications channel

• Ownership of audience

Skittles: 3,648,850 FB fans x 1 post/day = 109,465,500 monthly impressions

• Facebook product changes (red arrows) can greatly impact results:

– Introduction of Places (8/15) added greater prominence of Likes

– Introduction of Groups (9/21) reduced prominence of Likes

• Seasonality may also be reducing number of Likes into October

Social Sharing Transactions per Day

Averages Jul Aug 1-15 Aug 16-31 Sep 1-21 Sep 22-30

Likes/day 844 1,045 1,153 1,296 1,187

Visits/day 1,822 2,056 2,718 2,774 1,997

Transactions/day 44 78 321 450 188

Value/Like $0.29 $0.44 $1.62 $2.03 $0.92

Social Sharing Analysis

What Active Has Been Able to Accomplish

• Illustrate the positive impact of efforts

• Get approval for more budget to increase scale

• Evaluate the value of each marketing channel individually and succinctly

• Understand what resonates with our audience

• Know where to allocate resources

• Try virtually anything as long as results are measured

• Impress Facebook!

Resources

• Link shortening/tracking: http://www.bit.ly

• Post scheduling: HootSuite (http://www.hootsuite.com)

• Social monitoring: Google Alerts (http://www.google.com/alerts), Twitter Search (http://search.twitter.com)

• Analytics packages: Google Analytics (http://www.google.com/analytics)

• Engagement: Facebook Insights

Questions

If you have additional questions, please Email them to: ActiveEndurance@ActiveNetwork.com

@activenetwork

Thanks for Attending!