With any activity, the objectives need to be set as part of the strategy, then the ‘measures of success’ can be defined, then measured
Some people don’t want to look at quantifying the value of social media, because they argue it’s a completely new model, and it’s like trying to measure the value of email to businesses. However, if you’re an employee asking for budget to spend on social media, or a small business investing time in social media or you’re advising your clients to invest in social media, at some point the question will be asked how to measure whether it’s worth doing or not. You are making financial decisions about social, eg do I spend $2/click to get people to Like my FB page or should I send them to my website and skip the FB step?
There’s plenty of numbers in social media, numbers of fans, followers, retweets, likes but unless your objective is ‘get lots of followers’ then you still need to be able to translate those numbers into something that’s meaningful when it comes to measuring value.
We’re focusing on the ‘Value’ metrics because these are most likely to be where businesses can see a measurable number that they can understand and can help you achieve ongoing support and budget for social media activities
Businesses might want to know what it’s worth paying to acquire a fan – I don’t believe there is any set benchmark for this. Many studies have been done into this, but unless you ARE McDonald’s or Coke, this data isn’t really useful. Look at what you already know of your OWN business eg do you know the average value of a customer? What would you normally spend to acquire a customer? Then you can set your own benchmark for what you might be willing to spend on getting a ‘fan or follower’
Ads in Facebook, three specific objectives, so these numbers are more about measuring value from the campaign costs – but still interesting. Michael from SOP is comparing these stats, saying that 50c is more typical cost for a new like, $4-5 is reasonable to spend to acquire a new email address. The sales are based on those that are either directly attributed or an assisted conversion. SOP may find that these customers are higher in lifetime value.
Large companies typically measure the conversions, sales achieved through either directly attributing the activity to social media activity or where a customer’s purchase has included social media. Average lifetime value of a customer might be measured using CRM and the Social customers measured compared to non-social customers. Leads acquired through SM activity can be measured. Customer service can also be measured, it might be easier for customer to self-serve through social media, removing the cost of customer service from the company.
Core analytics looks after the usual web analytics, together with conversion activities, funnel and attribution to social. Other peripheral tools might be more important depending on the nature of the business eg a CRM might capture that a prospect/client came about as the result of social media activity. Depending on the nature of your business, you may need to incorporate other forms of tracking. For small businesses, it may be important to track manually, particularly if the call to action isn’t actually about purchasing online. Small businesses may also want to track time spent on social media to ensure accurate reporting on the value.
This is useful to give an overall sense of what is driving not just the traffic, but the actual conversion of business goals on the site
This demonstrates that conversion is not always immediate and shows that often conversions occur after interacting across a number of channels. It is possible to show the channels, and also whether the conversion is a direct conversion or simply that social media was one of the contributing channels to the conversion result.
Measuring the value of social media
Measuring the Value of Social Media April 10th, 2012 #smwomen @socialmediawomn
• Does social media have a value?• Can you measure it?• What tools are there to measure Social?• The future of Social Media Measurement
Measuring value starts with definingyour social media objectives• Why am I using social media? – Awareness/brand building – Drive traffic • To site • In store – Increase leads – Increase sales
Can you really measure the value ofsocial media?• Some people argue you can’t measure the value of social media• But: you’re investing money & time in it OR you’re asking your client or your company to invest in it you are making financial & strategic decisions
There’s lots of numbers... But whatmatters?• Is there value in measuring “vanity metrics”: – # of fans – # of followers – # of retweets, reach etc• Does it really matter if you’re not sure how much value they contribute to your business?
What to measure? • # of fans/followersAudience/Reach • Amplification (sharing etc) • Interactions with social content Engagement • Sentiment • Conversion to sale (purchases – online & offline) Value • Cost savings (customer service self service etc) • Lifetime Customer Value
Is there a ‘standard’ value for a SocialMedia fan/follower? Some companies can find Think about: that a social media fan/follower is more - Your average customer value (in lifetime valuable - Your average cost to acquire than a non-social value) a customer customer. - What you spend on other value in creating a Little lead generation activity eg standard value unless you advertising, SEO, SEMbaseresults from your and that on real data, own results. Source: DigitalBuzzBlog.com
Measuring value from a Facebookcompetition• Shoes of Prey case study• Objectives: – Increase fan base – Increase email subscriber base – Increase sales• Cost: $6800• 17500 new likes (.38c each)• 4000 new email subscribers ($1.70 each)• $3250 of sales attributed to campaign Source: 22Michaels.com
Measuring value by customerretention & sentiment• UBank case study• Objectives: – Innovation – Customer Service – Education• Measuring: – Sentiment (Net Promoter Score) – Impact on sales – Customer service: • Time to resolve • # of compliments/complaints Source: eMarketingConnected
Value of Social Mediafor Customer Service• Customers can find their own answers, and solve each other’s problems• Large companies doing Customer Service using Social measure cost savings
Measuring cost per acquisition &lifetime value StyleTread know two key things about their social media acquired customers: - Lower cost to acquire customer - Higher lifetime value (more likely to spend more) Source: eMarketingConnected.com.au
How large companies measure ‘value’• Conversions (purchases on eCommerce site) – Direct result of Social Media – Multiple channels including Social Media (attribution)• Average lifetime value of a Social Media acquired customer compared to non-SM• Leads acquired through Social channels• Reduced cost of customer service channels
But you don’t need a complexmeasurement approachBefore Social Media:Sold 2x dayAfter Social Media:Sell 10 x sandwich aday
Tools that can help Social Media Mgmt eg HootSuite, Radian 6 Core Website Facebook Insights, CRM Analytics LinkedIn page stats eg Google Analytics, Omniture Sentiment: eg Manual Social tracking Mention, Buzz Numbers
Look at what you can measure withyour existing toolset• Conversions – sign up or – purchase• For our business that is ‘value’ because: – We can reduce our spend on Search Engine Marketing – We can reduce our spend on traditional PR
What else can inform our decisions onSocial Media• We also know what channel brings us the most value, so we know which social media is more likely to convert• That lets us focus our efforts on the most successful channels for us• We still continue with the other channels, but put less time into these
Analytics: traffic sources forconversions• Can compare sources of conversions eg direct, search, social media
Analytics: multi-channel funnelsshowing multiple interactions• Using multi-channel funnels, track conversion across channels, shows a number of interactions before conversion Multiple interactions before conversion Some direct through social media, some include social Learn which social media channels are the most effective
Other useful measurement• Simple insights: Facebook insights can help you understand what your audience respond to
Other useful tools Crowdbooster is useful for showing which tweets had most impact, the best times to tweet and influential followers.
Other measurements Social Mention does quite simple sentiment measurement Sentiment measurement isn’t foolproof Worth benchmarking now and as you do more social activity
Other measurements Social Influence measures are increasingly being used in business Some companies already prioritise customer service queries by looking at Klout scores of customers
What next?• New Google Analytics: – Social Reporting being enhanced
Future predictions• Increased pressure to show measurable return• Smarter and more integrated reporting toolsets• More focused use of social media channels as companies understand what is returning value and stop using what isn’t• Social influence scores increasingly used in business decision making
Now what?• Know how much social media costs: – Tools – Time• Know what your objectives are• Know the value of achieving those objectives: – Value of a lead – Value of a sale – Value of a customer• Benchmark (today): – How many visits/leads/sales do I get – How many from SM and from what channels• Keep tweaking• Keep measuring
Useful resourcesSmart Insights – Tips on Social Measurement with Google Analyticshttp://www.smartinsights.com/google-analytics/google- analytics-setup/google-social-analytics-review/Occam’s Razor Blog:http://www.kaushik.net/avinash/best-social-media-metrics- conversation-amplification-applause-economic-value/Google Analytics Conversion Room Blog:http://conversionroom-japac.blogspot.com.au/
Keep in touchWeb: www.eMarketingConnected.com.auEmail: firstname.lastname@example.orgPhone: 0448822369 http://au.linkedin.com/in/traceylbrown @traceybrown74 www.facebook.com/pages/EMarketingConnectedAU