Why Social Media??General questions asked by executives when introduced toSocial Media: Why should I invest my valuable resources in Social Media? What business impact it will have on my business? What will be ROI in terms and time and resources invested? What are the key metrics to follow for measuring ROI in terms of engagement, sales, brand loyalty and customer retention?
Types of Social Media ROI.. Revenue Generation Cost Reduction• Increase in number • Saving on product of new customers development cost• Increase customer • Saving in research retention costs• Increase in how • Saving on transaction much people spend costs• Increase in how • Saving on technology often people spend or business costs
Things happen in sequenceInvestment inSocial media: Financial Non-financial BusinessTime, People Impact and Money Impact Impact $$$$ $$$$ Non financial Impact does not directly translate in ROI but necessary for business and financial impact
The sequence explainedNon-financial Business Impact FinancialImpact • Increased revenue Impact• Brand Awareness• Brand engagement• Word-of-mouth through new customers • Reduced • Revenue Generation • Cost Reduction $$ advertising cost • Reduced customer service costs $$ • Reduced product design cost
What the survey says…58 % says that social media campaigns helps in generating more revenue but only 41% thinks that it reduces cost.
3 Steps • Measure the Conversion rateStep 1 • Have the increased number of visitors also increasing number of transactions? • Measure Cost reduction through customerStep 2 engagement • Have the increased followers and interactions decreasing the PR and CRM costs? • Measure the Financial ImpactStep 3 • How the revenues and profits moving with social presence?
Step 1: Conversion Rate 18000 60000 Transactions 16000 No. of Vistitors 50000 14000 12000 40000 Social media management No. of VisitorsTransactions 10000 campaign was launched in 30000 8000 September. 6000 20000 As shown in graph: 4000 Customer transactions has 10000 2000 increased along with increase in no. of visitors 0 0 Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Months Before Social Media Since Social Media www.brandbuilder.wordpress.com
Step 2: Cost Reduction80000 PR Costs CRM Costs70000 Followers Conversations6000050000 The number of followers and conversations have increased40000 With Social media program.30000 As shown in graph: PR and CRM costs have first20000 decreased and then increased10000 due to increasing revenue. Overall, Both PR and CRM costs 0 have decreased in proportion Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb to sales revenue. Month Before Social Media Since Social Media www.brandbuilder.wordpress.com
Step 3: Financial Impact1816141210 REVENUE (Millions) 8 COSTS (Millions) 6 PROFITS (Millions) 4 www.brandbuilder.wordpress.com 2 0 Before Social Media Since Social Media The revenue has increased proportionally more than the cost. Thus increasing profit by the use of social media management
Now you may want to be more Social... Dildar Singh Social Media Analyst, Inrev Systems. E-mail: email@example.com M.no. : 08943400766
If you make customers unhappy in the physical world, they might each tell 6 friends.If you make customers unhappy on the Internet, they can each tell 6,000 friends. - JEFF BEZOS Social Media Monitoring Platform Visit : www.simplify360.com for FREE Demo