Social Media Measurement and ROI

HDC / Making the world more SOCIAL MEDIA + PR active. Sara Meaney Hanson Dodge Creative Partner | VP Social Media + PR October 11, 2011 @SaraMeaney©Copyright Hanson Dodge Creative. All Rights Reserved. 2

HDC / Making the world more SOCIAL MEDIA + PR active. What ROI is NOT •# Fans •# ReTweets •Total Impressions •# Post views, clicks, likes, comments or burps •These are key METRICS. But they are not ROI.©Copyright Hanson Dodge Creative. All Rights Reserved. 5

HDC / Making the world more SOCIAL MEDIA + PR active. What will your !"#$%&#$&(#%)#*+,# "-#%.(#/("0.&1#2)3.&4# answer be? %.56#"-#$%.0%#7"8# (9)&:;#©Copyright Hanson Dodge Creative. All Rights Reserved. 8

HDC / Making the world more SOCIAL MEDIA + PR active. What’s the point? How will you know if you succeeded? What are you trying to do? How will you measure it? You can’t do everything. Focus.©Copyright Hanson Dodge Creative. All Rights Reserved. 14

HDC / Making the world more SOCIAL MEDIA + PR active. Decrease •Reduction in customer acquisition costs cost •Reduction in customer service cost •Reduction in cost to innovate •Reduction in returns©Copyright Hanson Dodge Creative. All Rights Reserved. 18

HDC / Making the world more SOCIAL MEDIA + PR active. Brand objectives •Awareness •Sentiment •Word of mouth •Loyalty •Recruitment / Talent retention©Copyright Hanson Dodge Creative. All Rights Reserved. 19

HDC / Making the world more SOCIAL MEDIA + PR active. Risk management objectives •Reduction in exposure to risk •Improvement in response effectiveness •Speed of response©Copyright Hanson Dodge Creative. All Rights Reserved. 20

HDC / Making the world more SOCIAL MEDIA + PR active. Measurement models •PR / Advertising model •CLV (Customer Lifetime Value) •SEO model •Customer service / satisfaction©Copyright Hanson Dodge Creative. All Rights Reserved. 24

HDC / Making the world more SOCIAL MEDIA + PR active. Pick an objective. Measure it. •Identify / agree on key success metrics for this objective •Establish baseline levels •Track change •Ensure comprehensive measurement from all available data points©Copyright Hanson Dodge Creative. All Rights Reserved. 25

HDC / Making the world more SOCIAL MEDIA + PR active. “Can we literally sell our product or service via social media Objective: channels?” Sell more product / service YES NO Integrate purchase functionality into your social Maybe your budget or channels: technology does not allow. F-Commerce module, mobile storefront application, tracking codes, e-commerce, cookies, etc. So what CAN you do to inﬂuence purchasing Measure sales volume and behavior? calculate ROI based on cost to sell.©Copyright Hanson Dodge Creative. All Rights Reserved. 26

HDC / Making the world more SOCIAL MEDIA + PR active. Identify success metrics •Let’s pick “Increase Product Awareness” •What data points would indicate success on this objective? ✓Shares of product assets (images, video, etc.) ✓Online customer reviews of product ✓Traffic to product information page ✓Social comments, likes about product ✓Product mentions in third party media©Copyright Hanson Dodge Creative. All Rights Reserved. 27

HDC / Making the world more SOCIAL MEDIA + PR active. Measure it • What were the baselines before social media initiatives? • Have there been other additions to the marketing mix? • What other factors could contribute to potential increases or decreases?©Copyright Hanson Dodge Creative. All Rights Reserved. 28

HDC / Making the world more SOCIAL MEDIA + PR active. r ________ ) CLV: CLV = GC x ( Customer 1+d-r Lifetime Value GC: Gross contribution per customer r: annual retention rate (as a percentage) d: Discount rate, or cost of capital for the future value of a customer. Often roughly estimated w/ current interest rate. *This equation is a good estimate but doesn’t take into consideration costs to maintain a customer and assumes constant values for each variable. More complex CLV equations are required.©Copyright Hanson Dodge Creative. All Rights Reserved. 29

HDC / Making the world more SOCIAL MEDIA + PR active. r ________ ) CLV: CLV = GC x ( Customer 1+d-r Lifetime Value GC = $50 per widget r = 80% d = 2.75% Then CLV = $175.82 You spent $100,000 to acquire 2,500 new customers through traditional channels. Cost per acquisition = $40 Customer acquisition ROI = ($175.82 - $40)/$40 = 339.5%©Copyright Hanson Dodge Creative. All Rights Reserved. 30

HDC / Making the world more SOCIAL MEDIA + PR active. r ________ ) CLV: CLV = GC x ( Customer 1+d-r Lifetime Value GC = $50 per widget r = 80% d = 2.75% Then CLV = $175.82 You spent $75,000 to acquire 2,500 new customers through social media channels. Cost per acquisition = $30 Customer acquisition ROI = (175.82 – 30)/30 = 486.1%©Copyright Hanson Dodge Creative. All Rights Reserved. 31

HDC / Making the world more SOCIAL MEDIA + PR active. Simple calculation (Sales – Investment) ÷ Investment = %ROI Sales = $ sold via that channel or due to that channel Investment = all $ costs related to acquiring the sale: development + design of platform, time to manage or staff it, maintenance costs, advertising to drive awareness of channel, etc.©Copyright Hanson Dodge Creative. All Rights Reserved. 33

HDC / Making the world more SOCIAL MEDIA + PR active. Complex calculation (Revenue – Investment) ÷ Investment = %ROI Revenue = $ attributed to sales from leads through or assisted by social media Investment = all $ costs related to acquiring the sale: assign relevant costs to each level of lead nurturing required to close sale. Must include additional marketing, CRM, proposal development, presentation time, customer service activities, etc.©Copyright Hanson Dodge Creative. All Rights Reserved. 35

HDC / Making the world more SOCIAL MEDIA + PR active. Customer service • Used Helpstream (defunct) as CS portal • Before: 1 rep to 55 customers, 77% satisfaction rating • After: 1 rep to 172 customers, 87% satisfaction rating • Cost reduction: $millions • Satisfaction rating: up 13%©Copyright Hanson Dodge Creative. All Rights Reserved. 37

HDC / Making the world more SOCIAL MEDIA + PR active. Cisco social product launch •Comprehensive launch program for a new router -Second Life -Facebook -3D gaming -Social news releases -YouTube -Blog -Video conference -Tech Community -Mobile datasheet©Copyright Hanson Dodge Creative. All Rights Reserved. 38

HDC / Making the world more SOCIAL MEDIA + PR active. Launch costs • 9,000 people attended virtually – 90x more attendees than in the past • Saved 42,000 gallons of gas • 300% more media coverage than traditional outreach methods • More than 1,000 blog posts and 40 million online impressions • 1/6 the cost of a traditional launch • Saved $100,000©Copyright Hanson Dodge Creative. All Rights Reserved. 39

HDC / Making the world more SOCIAL MEDIA + PR active. Objective: Increase brand awareness for Wilson Basketball and its NCAA Brand Tournament affiliation awareness Success Metrics: Impressions Engagement Community Growth Conversion to website©Copyright Hanson Dodge Creative. All Rights Reserved. 40

HDC / Making the world more SOCIAL MEDIA + PR active. Success Metrics: Impressions Engagement Community Growth Conversion to website Brand Outcomes: awareness -50 million Facebook Impressions in 24 days. -Product page website traffic up 44% over previous month and 77% over March 2010. -Facebook became #2 source of all traffic to Wilson.com/ Basketball, after Wilson.com -Community grew from 0 to 23,200 in 24 days. -Feedback avg of .45% outpaced Facebook average .29% by 150% )2/(((% Visits to Wilson.com/Basketball (all traffic 2011 vs. 2010) )/(((% )(/(((% 4/(((% !"#"$#%&%())*%+,-*%./01% !"#"$#%&%()(% !"#"$#%&%())% 3/(((% 2/(((% /(((% (% 567% 8,9% :6;% <-;% :6=% 5>7% 5>?% <>@% +,-% AB$% CDE% F,B%©Copyright Hanson Dodge Creative. All Rights Reserved. 41

HDC / Making the world more SOCIAL MEDIA + PR active. Aggregated metrics • Most tools make gathering and processing easier • Some include distribution • Some include analysis • Some make pretty pictures • They (nearly) all cost money©Copyright Hanson Dodge Creative. All Rights Reserved. 43

HDC / Making the world more SOCIAL MEDIA + PR active. Want vs. need • Search / Aggregate mentions • Moderate conversation • Schedule / Publish content • Engagement management • Measure / Analyze • Language / Translation • Gamiﬁcation / sweepstakes tools • Pricing model©Copyright Hanson Dodge Creative. All Rights Reserved. 44

HDC / Making the world more SOCIAL MEDIA + PR active. 10 Metrics to watch 1.Leads generated 2.Website bounce rate 3.Website behavior 4.Growth of active network / engaged base 5.Brand mentions across social platforms 6.Website visitors and sources of traffic 7.Conversion: subscriptions, email lists, etc. 8.Time spent engaging: apps, time on site, etc. 9.Engagement ratio: active network / total network 10.Viral engagement: sharing, “people talking”©Copyright Hanson Dodge Creative. All Rights Reserved. 48

HDC / Making the world more SOCIAL MEDIA + PR active. MAKING THE WORLD MORE ACTIVE. ™ Hanson Dodge Creative is relentless about pushing the boundaries of engagement to deliver integrated solutions that work. Contact: Sara Meaney Partner | VP Social Media + PR©Copyright Hanson Dodge Creative. All Rights Reserved. Twitter: @sarameaney

Social Media Measurement and ROI

by Hanson Dodge Creative on Oct 16, 2011

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Social Media Measurement and ROI — Presentation Transcript