Elephant in the Room: Social Media ROI - WEB 2.0 NYC

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Elephant in the Room: Social Media ROI - WEB 2.0 NYC

  1. The Elephantin the Room:Social Media ROI<br />Mike Lewis@bostonmike<br />http://blog.socialepisodes.com<br />VP of Marketing, Awareness, Inc.<br />
  2. Who am I?<br />Boston native, New Dad, Entrepreneur and &quot;marketing guy&quot;<br />&quot;classically trained&quot; marketing guy<br />Ran marketing & sales at several start-ups and have used more than social media alone<br />First company sold to Intuit<br />Ran marketing & sales at Salesnet up to acquisition by RightNow<br />Left to start my own thing in 2006<br />VP of Marketing and Sales at Awareness Inc.<br />Social Media Marketing Software<br />Power social media strategies of several mid-to-large sized companies<br />Active blogger, tweeter, and social media enthusiast<br />Based Boston, MA<br />© 2009 Awareness CONFIDENTIAL<br />
  3. Awareness Product Suite<br />© 2009 Awareness CONFIDENTIAL<br />Sentiment Monitoring<br />Social Mining<br />Dashboards with ROI Metrics<br />Best Practice Communitieswith Self Service<br />Awareness Social Media Platform<br />
  4. What I believe (and what I don&apos;t believe)<br />I DO NOT believe social media is the only way of doing things<br />I DO NOT believe this replaces smart marketing<br />I DO believe there is a huge opportunity within social media for MOST companies<br />I DO Believe Social Media has been over complicated<br />I think social media is both tactics & strategy in your marketing bag<br />
  5. Things you should take away…<br />Marketing 101:<br />Avoid the hype of Social Media, think about how it can help achieve your goals<br />You can’t measure ROI of Social Media without knowing what to measure<br />To calculate ROI focus on where the RETURN is coming from<br />Keep social media ROI simple<br />© 2009 Awareness CONFIDENTIAL<br />
  6. Things I have heardCustomers say…<br />© 2009 Awareness CONFIDENTIAL<br />
  7. &quot;Social Media is a fad…It&apos;s purely a waste of time&quot;<br />- CMO, $B+ Retailer<br />© 2009 Awareness CONFIDENTIAL<br />
  8. © 2009 Awareness CONFIDENTIAL<br />&quot;Our Customers are notusing Social Media&quot;<br />- Multi-National Electronics Company<br />
  9. © 2009 Awareness CONFIDENTIAL<br />&quot;I know some of our customers are on LinkedIn, using our logo. That&apos;s why we have issued cease and desist orders to all of them.&quot;<br />- $500M B2B Software Company<br />
  10. © 2009 Awareness CONFIDENTIAL<br />&quot;Social Media ROI is Impossible&quot;<br />- Popular Social Media Consultant<br />
  11. © 2009 Awareness CONFIDENTIAL<br />7<br />TOP<br />MISCONCEPTIONS<br />
  12. © 2009 Awareness CONFIDENTIAL<br />#1<br />Build it and they will come<br />
  13. © 2009 Awareness CONFIDENTIAL<br />#2<br />Using Social Media to Broadcast, not LISTEN<br />
  14. © 2009 Awareness CONFIDENTIAL<br />#3<br />What if it all goes wrong?<br />
  15. © 2009 Awareness CONFIDENTIAL<br />#4<br />It’s FREE!!!<br />
  16. © 2009 Awareness CONFIDENTIAL<br />#5<br />We only use the FREESocial Web<br />
  17. © 2009 Awareness CONFIDENTIAL<br />#6<br />Tracking the wrong stuff<br />
  18. © 2009 Awareness CONFIDENTIAL<br />#7<br />No Plan or Objective<br />
  19. © 2009 Awareness CONFIDENTIAL<br />Now, Let’s Talk about the Elephant in the room<br />
  20. © 2009 Awareness CONFIDENTIAL<br />Social Media R.O.I.<br />
  21. First an ROI Primer<br />ROI = (Profit – Investment)/Investment<br />© 2009 Awareness CONFIDENTIAL<br />
  22. For Example<br />Investment: $1000<br />Profit: $5000<br />ROI = (5000 - 1000)/1000<br />ROI is 400%<br />© 2009 Awareness CONFIDENTIAL<br />
  23. Remember a couple of things…<br />ROI does not care about the MEDIA you use<br />If you keep it simple, it usually is<br />Don’t focus on metrics that don&apos;t make financial impacts (like page views, click throughs, Facebook followers, etc) – Focus on the ones that MAKE a financial impact<br />&quot;Profit&quot; may mean a sales or a reduction in costs <br />© 2009 Awareness CONFIDENTIAL<br />
  24. Simple ROI Framework<br />© 2009 Awareness CONFIDENTIAL<br />
  25. © 2009 Awareness CONFIDENTIAL<br />#1<br />Define the Objective<br />(or goals)<br />
  26. Sample: Company X<br />Large, Public software company<br />Transactional Model (lots of low cost customers)<br />1000&apos;s of clients worldwide<br />Stated Goals:<br />&quot;Connect with Customers&quot;<br />&quot;Share best practices&quot;<br />&quot;Improve customer Service&quot;<br />Business Objective:<br />Reduce support costs by driving self-service among peers<br />© 2009 Awareness CONFIDENTIAL<br />
  27. © 2009 Awareness CONFIDENTIAL<br />#2<br />Benchmark Before<br />
  28. Known Facts<br />Average support call/email costs around $40 to resolve<br />Over 70% of support calls are &quot;best practice&quot; related<br />Currently receiving around 1000 calls per month<br />Around 40K per month total; $480K p/year<br />© 2009 Awareness CONFIDENTIAL<br />
  29. © 2009 Awareness CONFIDENTIAL<br />#3<br />Track the RIGHT metrics<br />
  30. Known Facts<br />Originally were paying a lot of attention to traditional metrics like Page Views, Signups, Requests submitted, etc<br />Moved to track the FINANCIAL impact metrics:<br /># support issues submitted<br /># resolved through community<br /># escalated to customer service<br />© 2009 Awareness CONFIDENTIAL<br />
  31. © 2009 Awareness CONFIDENTIAL<br />#4<br />Track activities that measure $$<br />
  32. Results<br />Reduce call-in support by 75% in less than 3 months<br />Monthly inquiries went from 1K to just under 250<br />Increased average cost of call-in support to $50<br />Monthly spend of $12.5K; Annual spend of $150K<br />Community investment (est) $65K<br />Total investment: $215K<br />ROI = (Profit – Investment)/Investment<br />($480K-$215K)/$215K<br />ROI = 123%<br />© 2009 Awareness CONFIDENTIAL<br />
  33. Buckets to Track?<br />© 2009 Awareness CONFIDENTIAL<br />Social Yield<br />Social Effect<br />Results<br />
  34. Social Yield<br />Return vs. Performance Target<br />Examples:<br /># of response on Facebook page about your product<br /># of RT&apos;s on Twitter<br /># of people that join a blog discussion<br /># of new &quot;Fans&quot; &quot;Friends&quot; or &quot;Followers&quot;<br />Don&apos;t forget to put a stake in the ground<br />© 2009 Awareness CONFIDENTIAL<br />Social Yield<br />
  35. Social Effect<br />The Delta from Social activity<br />Examples:<br />Change in the number RTs about our company <br />Number of ebook downloads through your community<br />New leads through social channels<br />© 2009 Awareness CONFIDENTIAL<br />Social Effect<br />
  36. Results<br />How social media solved, met or missed the stated objective<br />Examples:<br />Increased sales<br />Reduced support costs<br />© 2009 Awareness CONFIDENTIAL<br />Results<br />
  37. © 2009 Awareness CONFIDENTIAL<br />Mike Lewis<br />@bostonmike<br />mike.lewis@awarenessnetworks.com<br />http://blog.socialepisodes.com<br />http://www.awarenessnetworks.com<br />

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