Social Marketing: This ROI is Too Good to be True

Before We Get Started… • Join the backchannel conversation during the Webinar at #socialroi • Presentations and Webinar recording will be archived and posted to our site later this week for you to download • A copy of the 2008 Social Marketing ROI and Benchmark Guide will be sent to you after the Webinar 2 © 2008 Powered, Inc.

Today’s Topics Branded Online Community Measurement Kathy Warren, VP Account Planning, Powered Results of the 2008 ROI Benchmark Study for Social Marketing Programs Bill Harvey, President, TRA Global Social Media: Why it Makes Sense and How I Prove it to Myself Brian Halligan, Co-Founder and CEO, HubSpot 3 © 2008 Powered, Inc.

Social movement creating opportunity across the Enterprise including high-potential for marketing • Social Marketing Planned as part of go-to- • Segment-focused Marketing market strategy communities Designed to drive: • Acquisition • Purchase consideration • eComm Ratings, Sales/Dist • Loyalty Reviews • Advocacy • Insight Long-term persistent • Voice of brand PR & strategy • Blogger outreach Corp Com • Support Forums Support 5 © 2008 Powered, Inc.

Three keys to branded online community success (and ability to measure) 1. Start with the audience segment & desired outcomes in mind, not „the message‟ – it‟s all about them 2. Give before you get - engage based on mutual INTERESTS first – Category second – Brand/products (not just the latter) 3. Listen and show that you heard 6 © 2008 Powered, Inc.

Social Marketing Transactional & Strategic ROI Brand.com E-mail marketing Paid Media Viral/WOM Total Visits 50% Engage (in content & conversations) Relationships Purchase eCommerce Brand Equity Segment insights influence handoffs • 4-7% of visitors • 74% more likely 18-20% reported 5% of visitors 6-12% ongoing register purchases (all click-through to to purchase survey response channels) online store via rates • 25% return • 86% willingness merchandise visitors to recommend Online Transactions 9 *Source: Averages across Powered communities CY2008 © 2008 Powered, Inc.

Cumulative ROI of Social Marketing Branded communities are persistent and drive ongoing return. 6-month pilot Year 1 Year 2 Year 3 Total Visits 225,000 900,000 1,080,000 1,440,000 Engaged 112,500 450,000 540,000 720,000 Consumers Registered 9,000 45,000 88,200 145,800 Members (4% cumulative) CTR to brand 11,250 45,000 54,000 72,000 Transactions* 2,250 9,000 10,800 14,400 (assumes 1%) Advocates 96,750 387,000 464,400 619,200 more likely to recommend Based on typical results from Powered programs – results will vary by brand , benchmarks are established during 6-mo pilot. 10 *Online transactions are dependent on client tracking via web analytics. All other measures are tracked by Powered. © 2008 Powered, Inc.

Managing to actionable KPIs – through behavioral & primary research data Objective Metric Objective Metric Purchase Visits Acquisition Clicks on Merchandise or CTAs Consideration Unique Visitors Additional hand offs to brand New vs. Returning Visitors Likelihood to purchase brand Bounce Rate Planned purchases in next 6 months Registered Users Reported purchases Marketing Opt-ins Estimated Revenue/course Group Members Brand Equity Program satisfaction Average Session Length Engagement Total page views Likelihood to recommend brand Page views/session % of users who refer-a-friend Total Engaged Visitors Retention % returning unique visitors Content Engagement (Enrollments, Views) % repeat sessions Social Engagement - Creators % of audience retained y:y Social Engagement - Critics Survey respondents by year registered Social Engagement - Contributors Operational Service call avoidance Social Engagement - Spectators Efficiency 11 © 2008 Powered, Inc.

About This Study  Purpose of This Study – Equip the marketing community with the best information from which to create the most effective marketing programs in the immediate future.  Study Methodology – Self-reported consumer data collected via surveys – Surveys were collected approximately 6-8 weeks into experience – Midpoint values were used in analyzing responses regarding amount spent on purchases of relevant products  Sample Size = 112,183 completed surveys 13 © 2008 Powered, Inc.

2008 ROI Results For 2008, Powered social marketing programs yielded a 60:1 ROI, a 10% increase from 2006. The results would indicate that the longer the program is sustained, the higher the ROI achieved. 14 © 2008 Powered, Inc.

2008 ROI Comparison by Marketing Program The Powered approach for social marketing programs has consistently outperformed the DMA and MMA ROI estimates for all of direct marketing and non-CPG mass media advertising for the past 3 years NCM has conducted this study. Direct Marketing Association (DMA) 2005 Economic Impact Study, Peter A. Johnson, PH.D., pjohnson@the-dma.org. MMA: “Finding The Other Half” by Erwin Ephron and Gerry Pollak, Ephron On Media website archive. 15 © 2008 Powered, Inc.

2008 Supplementary Findings Objective Metric Objective Metric Purchase 12M visits across Powered‟s online Nearly 500,000 clicks on product CTAs Acquisition Consideration community sites 7.5M unique visitors across 66% are more likely to purchase brand Powered‟s online community sites 7:1 ratio of new to returning unique 27% plan to purchase in next 12 mos visitors 1.4 million registered users 26% reported making a purchase Content 94% satisfaction rate with overall Brand Equity 85% would recommend brand Engagement content 93% satisfaction rate with 92% of users would refer-a-friend educational content 92% rated content as excellent, very Retention 95% would visit the site again good or good 16 © 2008 Powered, Inc.

Implications for Marketers  Give in order to get  Utilize a “soft sell” approach to marketing communications – inform, educate and help consumers  Provide the social marketing and Web experiences your customers value  Shift thinking away from short-term social media campaigns to long- term social marketing programs 17 © 2008 Powered, Inc.

Social Media: Why It Makes Sense & How I Prove It To Myself Twitter.com/bhalligan

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Social Media Visitors Page  21

Social Media Visitor Analysis Visitors Prospects Leads Opps Cust Slide  22 of

Social Media “Reach” Page  23

Thank you………..twitter.com/bhalligan Page  24

Questions? Kathy Warren, VP Account Planning, Powered  twitter.com/kathywarren  Facebook: Kathy Warren  E-mail: kathy.warren@powered.com  Blog: http://theengagedconsumer.powered.com/ Bill Harvey, President, TRA Global  bill@traglobal.com  www.traglobal.com Brian Halligan, Co-Founder and CEO, HubSpot  twitter.com/bhalligan  www.hubspot.com 25 © 2008 Powered, Inc.

Social Marketing: This ROI is Too Good to be True

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