The New ROI: Return On Involvement. Have you heard about the ROI measurement gap? We reported on it last week. Ifbyphone found in a survey that only a third or all marketers can “effectively evaluate the ROI of each channel.” That sounds like bad news. But it depends on how you define ROI (or return on investment). “My current reading is Relationship Economics by David Nour. “Your ROI question caught my eye…. “As you know ROI is a financial term that has been redefined by marketers as a justification for spending money in ways for which a financial ROI can not be measured.”
“Nour uses the term ‘ROI Reinvented’ to mean Return on Involvement: I looked at a video by Nour, for which Jim kindly sent the link. Nour recommends that you ask yourself these questions: Are customers engaged with your online marketing? Sounds like Nour and Fred Reichheld agree on some points. Tags: CRM, ROI. 3 Steps To Measuring Your Company's Social Media ROI. Virtually every business today acknowledges how important social media is to branding--and also how difficult it is to measure its actual ROI.
They know the social sites provide some measure of marketing firepower, but they don’t necessarily understand how to quantify its effectiveness. As a recent white paper from the Adobe company states, “Despite how pervasive social media has become, it isn’t being recognized for driving website traffic, engagement and revenue like it should be.” Adobe, in this same white paper, cites a 2011 social media survey it conducted of 750 marketing professionals. Although 73% of those surveyed said they used social media for campaigns in 2011, only 15% said they intended to do so in 2012. Maybe that’s because 88% didn’t feel they could accurately measure the effectiveness of those campaigns, with 52% citing problems with determining a true ROI as their biggest frustration. 1. 2. 3.
[Image: Flickr user Matteo Parrini] Why You're Struggling to Measure the Value of Social Media. In a recent report, Adobe examined the oft-discussed issue of how exactly to quantify the value of social media. What they found was that when it comes to measuring the ROI of social media, most marketers are using all the wrong tools. In fact, the vast majority of marketers included in their study of 225 companies relied exclusively on last-click attribution to measure the success of their social efforts. Last-click (aka last-touch) attribution is the form of tracking that most analytics tools like Google Analytics employ.
It’s called last-click attribution because conversions are measured based on the most recent channel that brought a visitor in before they converted. The problem with measuring social media through last-click attribution is that social channels tend to engage people at the top of the sales funnel rather than right before they buy. Is social media working to bring in customers? What You’ll Need: First-Touch Analytics What are my best channels? 4 Metrics to Measure Social Media's ROI. Dilip Venkatachari | April 24, 2013 | 5 Comments inShare64 Four metrics that marketers should pay close attention to in order to gauge whether their efforts and initiatives in social are moving the needle for their brands. How do marketers begin to measure ROI in social media? After all, likes, follows, and repins are not among our usual business KPIs. That said, I do think that there are a few metrics that marketers should pay close attention to in order to gauge whether their efforts and initiatives in social are moving the needle for their brands.
As you look to start building your case for marketing dollars, consider the following metrics and related critical questions: Share of voice. Clearly, social ROI is far more complex than a simple cost vs. brand lift equation. The ROI of social media is really delayed ROI. So, when it comes to social, marketers need to stop being hyper-focused on the immediate ROI question (I know, it's hard!) Silver Bullet image on home page via Shutterstock. Calculate the ROI of Social Media. InShare629 Guest Post by Jaap Favier, managing partner of The Small Circle What is the secret of bars? Why do we happily pay four times as much for beer in a bar as in a store?
We pay this brand premium to be with friends. The secret of bars is that they convert our quality time into cash. Like bars, social media are places where friends meet. The best social media programs also convert the consumer’s social time into a brand premium, reaching a return on investment (ROI) up to four times as high as the ROI of a TV commercial. The time with friends and relatives is worth a lot to us. Twitter accounts, and Pinterest boards serve as online bars, where: Staff speaks to visitors.
Strangers introduce themselves. Friends converse with each other. A consumer, let’s call her Lucy, walks into a bar wearing her TOMS. Lucy’s contacts see her online signals. Each time Lucy and a friend share a brand experience, they invest time and trust. Number of touchpoints. Time. Trust. Sentiment. Income. 1. 2.