Budgeting for Social Media: Art or Science?

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According to Altimeter Group's latest report, most of the brands are engaged in some form of Social Media Marketing. Yet most of marketers are not sure how to budget for success. Explore some of the strategies and tactics involved with social media budgeting and planning for success and conversions.

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Budgeting for Social Media: Art or Science?

  1. 1. Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Alex Romanovich - @alexromanovich Material in this seminar is for reference purposes only. This seminar is sold with the understanding that neither any of the authors nor the publisher are engaged in rendering legal, accounting, investment, medical or any other professional service directly through this seminar. Neither the publisher nor the authors assume any liability for any errors or omissions, or for how this seminar or its contents are used or interpreted, or for any consequences resulting directly or indirectly from the use of this seminar. For legal, financial, medical, strategic or any other type of advice, please personally consult the appropriate professional.
  2. 2. About the Webinar Speaker <ul><li>Alex Romanovich, Founder – Social2B, CMO – EuroSpaClub International, Advisory Board Member – The CMO Club </li></ul><ul><li>Unique blend of technology, marketing and business development skills and experience (IBM, SGI, Bertelsmann AG, Unified Technologies, Global Advertising Strategies, Social2B, EuroSpaClub Intl.) </li></ul><ul><li>Frequent speaker and advisor on topics of International and Multi-Cultural Mktg. (CNBC, CNN International, Forbes, Crains, Voice of America, etc.), Social Media </li></ul><ul><li>Social Media Marketing, Social Value Chain, and Social Media Scalability Expertise </li></ul><ul><li>@social2B, @alexromanovich, @eurospaclub </li></ul>Slide Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Alex Romanovich www.ExecSense.com © ExecSense, Inc.
  3. 3. Overview <ul><li>Social Media Networks are the most popular consumer-oriented and B2B oriented, ‘client-centric’ outlets on the Internet </li></ul><ul><li>Social Network give you the opportunity to connect, engage, build a community, and convert clients and connections into ‘advocates’ for your business and brand </li></ul><ul><li>Social Media Networks give companies and individuals the ability to share their knowledge with prospective customers and clients, community, making it more likely that they'll be chosen over a competitor or be deemed as a subject matter expert </li></ul>Slide Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Alex Romanovich www.ExecSense.com © ExecSense, Inc.
  4. 4. What to Know - Why Social Media is still important in 2011-2012 <ul><li>4 out 5 US businesses over 100 people will use Social Media Marketing in 2011(eMarketer, 2011) </li></ul><ul><li>Social Media Marketing spending is increasing and Social Media Advertising (Ad spending on social media destinations) will cross $2B in 2011(eMarketer, 2011) </li></ul><ul><li>85% of Marketers indicated that Social Media Marketing generated exposure for their business ( ‘Social Media Marketing Report, 2010”) </li></ul><ul><li>There are over 4,700 Social Media Jobs available in NY market area alone (Source: www.indeed.com) </li></ul>Slide Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Alex Romanovich www.ExecSense.com © ExecSense, Inc.
  5. 5. Average Annual SM Budget – 2010 (Source: Altimeter Group) Slide 5 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Alex Romanovich www.ExecSense.com © ExecSense, Inc.
  6. 6. Sales and Marketing Funnel - Traditional Slide 6 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Alex Romanovich www.ExecSense.com © ExecSense, Inc. Prospect Traditional ad & branding media Direct & digital media lower value higher value Prospects and Customers Customers Loyalty Cross Sell Upsell Purchase Preference Consideration Interest Awareness TV Radio Newspaper Magazines Outdoor Cinema Events Direct Mail Email Search & Web Social Media Web 2.0 Mobile/SMS DRTV DR Print CPC Games
  7. 7. Sales and Marketing Funnel - New Slide 7 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Alex Romanovich www.ExecSense.com © ExecSense, Inc. Awareness Loyalty Cross Sell Upsell Purchase Preference Consideration Interest Traditional ad & branding media Direct & digital media lower value higher value TV Radio Newspaper Magazines Outdoor Cinema Events Prospects and Customers Customers Direct Mail Email Search & Web Social Media Web 2.0 Mobile/SMS DRTV DR Print CPC Games Prospect
  8. 8. Sales and Marketing Funnel – New Integrated Funnel Slide 8 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Alex Romanovich www.ExecSense.com © ExecSense, Inc. Traditional ad & branding media Direct & digital media eRFP request Select Partner Research a product Search brand Nurture lead Pass link Qualify Lead Email $ $ View ad Interact with ad Social bookmark Write a review Rate a Product Click email Register account Blog entry Register account Transact View Facebook M commerce Info request Close lead lower value higher value TV Radio Newspaper Magazines Outdoor Cinema Events Prospects and Customers Customers Direct Mail Email Search & Web Social Media Web 2.0 Mobile/SMS DRTV DR Print CPC Games Prospect
  9. 9. Tips, Tricks, & Techniques <ul><li>According to the same Altimeter Group, maturity of an organization will define the budgets that should be allocated proportionally </li></ul><ul><li>Overall budgets should increase as social business matures (annual social media budget for a Novice organization averaged $66,000, while Intermediate and Advanced averaged nearly the same at $1M to $1.3M) </li></ul><ul><li>As Social Media business matures, team sizes grow but spread across functions (provided there is a buy-in at the executive level) </li></ul><ul><li>To scale, organizations may have to re-organize or organize differently – centralization and standardization may have to be considered </li></ul><ul><li>Scalability has to be preceded by a robust metrics and measurement development exercise, to make sure analytics and reporting is in place </li></ul>Slide 9 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Speaker Name www.ExecSense.com © ExecSense, Inc.
  10. 10. Tips, Tricks, & Techniques <ul><li>Assessing your organization business maturity level can be important </li></ul><ul><ul><li>Program – experimenting or more advanced level </li></ul></ul><ul><ul><li>Leadership or Organization Model – centralized or distributed </li></ul></ul><ul><ul><li>Processes or Policies – mature or still developing </li></ul></ul><ul><ul><li>Education – formal education present or still being developed </li></ul></ul><ul><ul><li>Measurements – tied to social media success or business success </li></ul></ul><ul><ul><li>Technology – investment present in integrated infrastructure or still maturing </li></ul></ul>Slide 10 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Speaker Name www.ExecSense.com © ExecSense, Inc.
  11. 11. Tips, Tricks, & Techniques Slide 11 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Speaker Name www.ExecSense.com © ExecSense, Inc.
  12. 12. Case Studies <ul><li>Case studies and statistics from Altimeter: </li></ul><ul><li>All corporations will gear up their social media efforts in 2011 and 2012 (46% increase in spending, but the staff will remain small) </li></ul><ul><li>Training and Education will be a priority, but still underfunded </li></ul><ul><li>Corporations will invest in Ad and Marketing on social networks (75% of companies will spend Ad and Marketing dollars in 2011) </li></ul><ul><li>Advanced and mature companies will spend 3X more on Boutique Agencies (in comparison to traditional agencies) </li></ul>Slide 12 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Speaker Name www.ExecSense.com © ExecSense, Inc.
  13. 13. Case Studies <ul><li>Case studies and statistics from Altimeter: </li></ul><ul><li>Most of the corporations will spend 56% more on brand monitoring and reporting, but ROI puzzle will still not be solved </li></ul><ul><li>Community platforms will be on the rise </li></ul><ul><li>Advanced corporations will invest in Custom Technology Development, including integration of social networks on the corporate websites </li></ul><ul><li>Companies will invest into SMMS and SCRM (Altimeter Group) </li></ul>Slide 13 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Speaker Name www.ExecSense.com © ExecSense, Inc.
  14. 14. FAQs <ul><li>Number 1 – If I increase my social media budget, I can get some quick results </li></ul><ul><li>Number 2 – I can probably do some test campaigns and see if any of them will be successful, then I can scale </li></ul><ul><li>Number 3 – It’s tough to educate everyone in the company on the benefits of social media, let alone ask for budget </li></ul><ul><li>Number 4 – We need to establish some social media metrics first and experiment – business metrics are not important </li></ul><ul><li>Number 5 – I can simply decrease my budget by hiring junior staff and interns and get the same results </li></ul><ul><li>Number 6 – Social Media may sill be immature, hence I will focus more on the traditional media </li></ul><ul><li>Number 7 – My existing agency (PR or Ad) can handle all social media efforts. Why should I get another one? </li></ul><ul><li>Number 8 – I am too busy to pay attention to Social Media and ROI hasn’t been proven – maybe next year </li></ul><ul><li>Number 9 – Investing into social media tools seems like a thing of a future – I can’t leverage it now </li></ul><ul><li>Number 10 – My CEO doesn’t understand it, hence I will not bother with it </li></ul>Slide 14 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Speaker Name www.ExecSense.com © ExecSense, Inc.
  15. 15. Moderator Questions <ul><li>List three questions you would like the moderator to ask you during the Q&A section to help spur questions from other attendees: </li></ul><ul><li>Number 1 - What are the most important factors in considering a budget for social media? </li></ul><ul><li>Number 2 – Does the SM budget have to be a part of the overall marketing number? </li></ul><ul><li>Number 3 – How much budget should I allocate to external and internal resources? </li></ul>Slide 15 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Speaker Name www.ExecSense.com © ExecSense, Inc.
  16. 16. Supplemental Documents <ul><li>Altimeter Group Report on Budgeting for Social Media </li></ul>Slide 9 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Speaker Name www.ExecSense.com © ExecSense, Inc.
  17. 17. Conclusions <ul><li>Point 1: Social Media spending will be more robust – time to plan is now </li></ul><ul><li>Point 2: Get trained resources or start training for SM campaigns – will help with budgeting </li></ul><ul><li>Point 3: ROI metrics are important and need to be established early, in unison with the financial, technology and HR organization </li></ul>Slide 17 Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Speaker Name www.ExecSense.com © ExecSense, Inc.
  18. 18. Additional Documents <ul><li>Please email the finished PowerPoint and any other sample documents to [email_address] at least three business days before your scheduled webinar presentation. </li></ul><ul><li>If the files are too large to send through your email server, let us know and you can use our large-file email service at www.yousendit.com. </li></ul>Best Practices for Creating Your Social Media Budget- What CMOs Need to Know Speaker Name www.ExecSense.com © ExecSense, Inc.

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