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Oliver Blanchards Basics Of Social Media Roi
 

Oliver Blanchards Basics Of Social Media Roi

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The what, why and how of Social Media ROI: Business definitions, methodologies and situational narrative. This presentation\'s purpose is to clarify what ROI is and isn\'t within the context of Social ...

The what, why and how of Social Media ROI: Business definitions, methodologies and situational narrative. This presentation\'s purpose is to clarify what ROI is and isn\'t within the context of Social Media and offers a basic explanation of how to tie Social Media activities to real ROI.

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    Oliver Blanchards Basics Of Social Media Roi Oliver Blanchards Basics Of Social Media Roi Presentation Transcript

    • Enough with
      the Social Media BS.
      Give me the realz.
      Social Fresh Conference // 24 August 2009
    • SOCIAL MEDIA IS NOT FREE.
    • 1. It takes people.
    • 2. It takes technology.
    • 3. It takes time.
    • We have… rocks.
      … all of which are limited resources.
    • These resources
      =
      100%
      of your budget
      E-Marketing
      Each resource
      has a specific cost
      Head Count
      Advertising
      I.T.
      Inbound Call Center
      Each resource
      yields specific results
      Marketing
      Sales Dept.
      Accounting
      Public Relations
    • These resources
      generate
      100%
      of your business
      E-Marketing
      Losing even 1%
      of your budget’s efficiency
      could seriously ruin
      your day.
      Head Count
      Advertising
      I.T.
      Inbound Call Center
      Marketing
      Sales Dept.
      Accounting
      Public Relations
    • Okay fine. But if
      I’m going to take a chance
      on this social media thing,
      it had better make good business
      sense! Why should I allocate
      resources to it?
    • Reason #1:
      It will result in a cost reduction.
      Maybe in customer service?
      You mentioned something about
      business intelligence and
      market research?
      Reason #2:
      It will generate more revenue.
      I want more transactions,
      more net new customers,
      more customer loyalty,
      etc.
    • Now go figure out what
      Program you have to cut
      to fund this Social Media thing.
      Remember that our bonuses
      are on the line.
    • Understand that a new
      Social Media program’s
      funding doesn’t appear
      out of thin air.:
      Which buckets do we empty
      to fill this new one?
    • SAY HELLO TO:
      Business Justification
      R.O.I.
    • R.O.I.
      RETURN
      ON
      INVESTMENT
    • THE R.O.I. EQUATION
      Investment
      Expectation of return
    • THE R.O.I. EQUATION
      (GAIN FROM INVESTMENT - COST OF INVESTMENT)
      ROI =
      COST OF INVESTMENT
    • Truth about R.O.I.
      ROI is a business metric,
      not a media metric.
      ROI is 100% media-agnostic.
      Only measuring digital or social won’t get you anywhere.
    • Reason #1:
      COST REDUCTION
      Reason #2:
      REVENUE GENERATION
      Remember what Mr. Bossman said…
    • I shrank my PR budget by 20%
      and my outbound call budget by 40%.
      Now I can afford a team of social media
      Rock stars. Can I get a hellz yeah?
      Okay, hotshot,
      You have your Social Media doohickey.
      Now I’d better see some real results!
      Or else…
    • Woohoo!
      I have a job!!!
    • Dudes, we are
      ON THIS!!!
      Let’s start engagin’!!!
      I call dibs on the
      Corporate blog.
    • Cool.
      ACCOUNTING
      One Month Later…
    • What about our
      Twitternets?
      Oh my! Look at all the new
      visitors to our website!
      and all of our FaceBook friends!
      Hot Damn, we even have
      comments on the blog!
    • This rocks!
      I never had it so
      good!!!
    • Cool.
      ACCOUNTING
      Three Months Later…
    • Yeah but…
      What about
      the P&L?
      Monitoring to base…
      Monitoring to base…
      Our Google Analytics are through
      the roof! Even our social mentions
      are wicked good!
      We have liftoff!
    • Measuring media
      really rocks my
      world.
    • Nope.
      Anything?
      Nada.
      ACCOUNTING
      Six Months Later…
    • What kind of mood is
      The old man in today?
      Not good.
      He doesn’t care how many visitors
      the website gets, or how many
      eyeballs we estimate we’ve reached unless it means we’re selling
      more stuff.
    • But why?
      Our website is getting
      mad hits, Jack!
      And we have 3,000 followers
      on Twitter now!
      I’m sorry, son.
      If your Social Media program
      is generating revenue, we aren’t
      seeing it. We need to allocate
      resources where we can
      make money.
      It’s just business.
    • Darn it.
      This media measurement
      stuff isn’t working.
      We need to start
      tying this stuff to actual
      Business performance.
      Where to start?
      Let’s see…
      At the beginning?
    • Things happen in sequence.
    • Non-financial impact is not ROI (yet).
    • Types of non-financial impact
      Customer complaints
      Website Visitors
      Impressions
      Positive press
      Click-throughs
      YouTube views
      Retweets
      Coupons distributed
      Visitors to a brick & mortar store
      Positive WOM
      Delivered emails
      Negative press
      Negative WOM
      Employment applications
      Blog comments
      FaceBook friends
      Social mention
      Twitter followers
    • Non-financial impact = potential.
    • ROI = actualized potential.
    • Reason #1:
      COST REDUCTION
      Reason #2:
      REVENUE GENERATION
      Remember what Mr. Bossman said…
    • I need proof that
      what we’re doing
      is actually working.
      Start with proof of concept.
    • Step 1: Establish a baseline
      8% YoY Growth
    • Baselines illustrate deltas (changes)
      Is something happening here?
    • Step 2: Create Activity Timelines
    • Step 2: Create Activity Timelines
    • Step 2: Create Activity Timelines
    • Step 3: Look at Sales Revenue
    • Step 3: Also look at # of transactions
    • Step 3: Also measure net new customers
    • Transaction data should be specific
      F.R.Y.
      FREQUENCY, REACH, YIELD
      How often customers transact. (transactions per month)
      How many customers you are reaching. (net new customers)
      How much they spend. ($ per transaction)
    • The latest numbers indicate
      that our YoY sales $ are up 60%.
      Our individual transactions have doubled,
      as have our transacting customers.
      Something’s working!
      Groovy!
      Let’s figure out what.
    • Step 4: Measure transactional precursors
    • Step 4: Measure transactional precursors
    • Step 4: Measure transactional precursors
    • We overlaid all of our timelines
      and noticed that since our social media
      activities began, our website visits are up,
      our social mentions are also up, and
      everyone seems to love us.
      So is there a
      discernable pattern
      in this?
    • Step 5: Overlay all timelines
      activities
      social data
      web data
      transactions
      loyalty metrics
      etc.
    • Step 6: Look for patterns
      Impact
      Uncertain Impact
      Impact
      Impact
      No Impact
      Before
      After
    • Step 7: Prove relationships
      How was this group
      Touched by SM?
      Before
      After
    • How long
      will all this
      analysis take?
      It’s all a process
      of elimination, really.
      Isolating patterns,
      quantifying deltas,
      proving ad-hocs…
      Then all
      we have to do is
      figure out what the cost
      savings and revenue gains
      are, and plug them
      into the equation.
    • THE R.O.I. EQUATION
      (GAIN FROM INVESTMENT - COST OF INVESTMENT)
      ROI =
      COST OF INVESTMENT
    • THE R.O.I. EQUATION
      Investment
      Expectation of return
    • Oh wow.
      This R.O.I. thing
      wasn’t at all about
      measuring media,
      impressions and
      eyeballs!
    • All things remaining the same…
      We may have
      proof of
      concept.
      Hot damn!
      ACCOUNTING
      First things first: Prove that Social Media works
    • So it turns out that our
      Social Media program is impacting
      every aspect of our business except
      traffic in our brick and mortar stores.
      Can you get on that? Yeah. We need
      to find out why we aren’t having
      an effect there. Kthxbye.
      Then use what you know to make it work better.
    • More store traffic.
      Roger that.
      Dudes, we are
      ON THIS!!!
      Let’s start engagin’!!!
      I’ll start crafting some
      wicked blog posts.
    • Finally, someone with some
      real metrics for me to sink my teeth into!
      Good job, Sparky! You done gewd!
    • So I guess Social Media
      is going to stick around a little while
      longer after all, isn’t it?
      Yessir.
      Looks like our budget
      is safe for now.
    • Drinks for
      Everybody!
    • Olivier Blanchard
      Principal, BrandBuilder Marketing
      864.630.7398
      www.thebrandbuildermarketing.com
      @thebrandbuilder(on Twitter)
      www.smroi.net
    • Slideography
      Slide # Source
      3, 9, 10, 11, 18-31,
      37, 38, 48, 52, 56,
      59-65
      4
      6
      UFO (TV series)
      http://ufoseries.com/
      http://www.minnpost.com/stories/2008/06/18/2282/this_doesnt_compute_as_more_women_enter_scientific_fields_their_numbers_in_computer_science_are_declining
      Kim Jong Il puppet, from “Team America”
      http://blogs.rockymountainnews.com/bridget/kimjongil.jpg