NADA MarketINSIGHT: Does the ROI on Social Media Pencil? New Ideas on Measuring Performance of Social Media “As an industry, we need toget past the point of listening to closely to so-called social media gurus who respond to dealer questions about ROI by dancing around the use of objective measurements in applying performance analysis to automotive social media marketing initiatives…” -- Ralph Paglia
What: Debunk many of the fallacies surrounding social media by applying measurement and tracking systems to eliminate mysteries surrounding social media marketing and reputation management ROI.
Why: Despite an endless supply of new social media sites similar to, but different from Facebook, YouTube, Twitter, Google, DealerRater and hundreds of others, there has been little effort to supply dealers with tools to measure and report results… Yet, dealers are being inundatedwith various spins on social/digital media made during new vendor pitches for dealer dollars.
How: The current situation around social media is like the 18th century question, "How many angels can dance on the head of a pin?" In my opinion, too many social media pundits dance around each dealer inquiry concerning tracking, results measurement and ROI analysis… Put measurement systems in place BEFORE starting a social media initiative!
Total Dealer Economic Impact Forrester’s ROIMethodology Benefits
Benefits(Impact on dealership) R I S K Costs(Impact on expenses) Cost
Flexibility(Proactivevs Reactive) “Options” created
Are there new opportunities created for future revenue and profit realization?
Impact of “assumptions”
There are many benefits of Online Dealer Communities… Source: “The ROI of Online Customer Communities” Forrester Research
AutomotiveExamples Strategic ROIProforma…
Planning… The essentialingredient todriving withyour eyes open! Objectives… The essentialingredient togetting results.
Social Media Results Known = Dealer ROI(the What) Marketing Communications: Create and Publish content that attracts consumers within demographics targeted by social media marketing strategy. Use Social Apps to engage/interact/convert. Reputation Management: Monitor social web for content posted containing dealership brand. 911 Fast Response Strategy and Process for negative content posted. Notify dealer POC’s of what was posted, when and by who. Send POC copy, including response published and actions/due dates required “Social Rewards” strategy for positive posts, comments and mentions Promptly create and post appropriate responses to all dealership mentions so people see your store cares, pays attention, responds, appreciates compliments and resolves customer concern issues Traffic Generation: Use anchor text and linked content to drive targeted traffic from social media sites into dealer’s social assets and websites, incoming phone calls to social media assigned numbers, use stories to drive showroom traffic Improve SEO Strategy: Quickly increase the dealership SEO “footprint” with multiple SERP listings from dealer’s Social Media accounts and profile subdomains. Back links from hundreds of Social Media sites to dealer’s eCommerce sites boost authority and rank with search engines.
Social Media Marketing Tactical Objectives (the How) Create and Publish high quality content that attracts and engages people in demographic categories your overall dealership marketing programs seek and target Monitor every post that mentions your dealership, report to key dealership stakeholders on what it is, when, where and by who Promptly post appropriate responses to all dealership mentions so people see your store cares, pays attention, responds, appreciates compliments and resolves customer concern issues Drive qualifiedtraffic from social media sites (earned media) to dealership sites (owned media) defined by marketing strategy Improve SEO “footprint” by creating multiple SERP listings using dealership branded Social Media accounts and profile pages
History and Correlation Good ROI analysis requires accurate historical performance data (which few dealers have). Capturing and analyzing historical data requires time and discipline. It’s easy to cast aside analytical tasks when everyone is focused on making deals and generating profit. Historical datasets a baseline for measuring the “Delta”.That change can then be measured and compared to actions that may have caused it. If you can correlate Social Media initiative actions to impact, then you can calculate ROI.
Automotive Avenues Internet Sales Lead volumeYear Before Investing resources into Social Media Marketing 2,383 Leads Submitted Annually (Above the National Average for metro car dealers of 968)
Automotive Avenues Internet Sales Lead volumeYear After Investing resources into Social Media Marketing 6,340 Leads Submitted Annually 166% IncreaseDuring Worst Economic Climate in 30 Years!
Does posting relevant Blog content that attracts Traffic yield an increase in volume of Internet Sales Leads? Sales Leads Blog Visitors
Does postingYouTube videos designed to drive Lead Form submissions generate ROI?
ROI Performance Metrics PUTTING IT ALL TOGETHER Apply all the measurement factors available for B2C social marketing scenarios. Then compare the ROI of Events to buying RFQ leads. Start with historical data. What is the conversion rate of leads from special events versus 3rd Party Leads? What is the lifetime value of an average car buyer to your dealership? Compare the outputs and divide by costs to assess ROI: Assumptions: Average cost of a special event for 100 RSVP attendees= $3,000 People attending your eventsconvert at a 2% sales rate (30 days) Average cost of buying 500 3rd Party Leads is $10,000 3rd Party Leads convert to sales at a 1% rate.
Lead Generation from Article Marketing Let’s look at one more example in which we use a blog for lead generation. We know that performance will be slow during the first few quarters until search engine traffic kicks in. Based upon the experience of others, we believe that lead growth will improve steadily as traffic builds. We expect to be at 50 leads per month by the end of the first year and 160 per month by the end of the second. Our historical data tells us that a lead is worth $100. We further estimate our editorial costs at $2,000 per quarter during the first year, doubling to $4,000 during the second. Here’s our analysis of quarterly and cumulative ROI.
Measuring Intangibles The trickiest aspect of ROI analysis is accounting for intangibles. These include factors like customer satisfaction, customer loyalty, brand reputation and market influence. Many social marketing projects are justified for these reasons but the outputs are never measured, either because it’s not worth the effort or because the measurements aren’t in place. In fact, all of these outputs can be measured and have been for years using some of the following tests:
Automotive Marketing ROI; By Social Media Channel
What happened when 11,159 People in San AntonioVisited AnciraCommunity.com
11,159 Absolute Unique Visitors
4.94 Average Pageviews
00:04:32 Time on Site
48.12% Bounce Rate
60.36% New Visits
Advertising Equivalent Value What is the Display Advertising Media Equivalent Value of AnciraCommunity.com Impressions?
11,159 Absolute Unique Visitors
Theaggregate average Cost Per Thousand Impressions (CPM) for “Automotive Intender” geotargeted advertising in San Antonio market is $7.57 CPM… 90,715 Pageviews = 907.15 CPM Units 907.15 x $7.57 = $6,867.13
Advertising Equivalent Value What is the Google Adwords Pay Per Click (PPC) Search Advertising Media Equivalent Value?
11,159 Absolute Unique Visitors
The aggregate average Cost Per Click (CPC) for Google Adwords campaigns for automotive relevant keywords geotargeted within San Antonio Metro is $2.64 CPC… 18,374 Community Visits = 18,374 Click Throughs 18,374 Clicks x $2.64 CPC = $48,507.36
Advertising Equivalent Value What is the comparable Cost Per Unique Visitor Equivalent Value?
11,159 Absolute Unique Visitors
The aggregate average Cost Per Unique Visitor (CPUV) for all other Ancira Auto Group online campaigns focused on driving traffic to Ancira Web Sites $2.12 CPUV… 11,159 Unique Visitors X $2.12 CPUV ------------------------------------ $23,657.08
What is the Social Media Aggregate Equivalent Media Value Average for AnciraCommunity.com within the time period measured? $6,867.13 CPM $48,507.36 PPC $23,657.08 CPUV ------------------------ (79,031.57 / 3) = $26,343.85
Social Media Marketing: Measurements to Financial Values for ROI
Social Media Marketing – ROI Categories
Ads were seen 7,201,334 times in October by Facebook members who live near the two dealerships in this case study… 1,730 of those Facebook members clicked on one the two dealer advertisements… Since we spent $1,595.25 for the Facebook Ad Campaigns, each click customer visit to our community site, or Fan page cost 92 cents. To show Facebook members our dealership ads 1,000 times, it cost 22 cents…
Case Study: Ancira Auto Group Birth of a Social Community ADP builds AnciraCommunity.com integrated w//Facebook, Twitter, Flickr, etc. Ancira personnel & suppliers set-up profiles - Get engaged – Create Content Registration / Publication Site Registered in 120 Social Venues Web based console manages all accounts Will you be my Facebook friend? Subscribe to our YouTube channel Follow Us on Twitter User Content Fun Stuff ForCustomers Road tests, reviews & how to’s “Canine Romance Blooms…” Syndicated Content Interviews with Civic leaders Relevant Info From Other Sources Dealer Information Ancira Crafts Their Message Employees engage discussions Local Interest Highlight AnciraCivic Leadership Become local social media leader 3 4 5 6 1 2
Case Study: Ancira Auto Group – San AntonioSocial Media Reputation Management Results Positive customer feedback “Heaters Become Raving Fans” “I am absolutely blown away that you not only responded… but that you use social media” “I will be happy to explain to everyone the fantastic service I received…” SERP Returns10 pages of AnciraSocial Media content Branded Search ancira dodge san antonio ancira auto group ancirachevrolet ancirakia san antonio Search Engine Results (SERP) Consumer Response to Social Media Advertising