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Social Marketing & PR ROI - Focus roundtable

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This is a slide deck that accompanied a Focus roundtable on how to calculate a marketing and PR ROI.

Focus roundtable = http://www.focus.com/roundtables/simplifying-social-business-social-marketing-and-pr-roi/

Published in: Business, Technology
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Social Marketing & PR ROI - Focus roundtable

  1. 1. Social Marketing and PR ROIDrNatalieNews www.kathyherrmann.com
  2. 2. Marketing & PR ROI Gains• Revenues from enhanced Marketing Funnel Dynamics • Increased word of mouth and customer influence: Shares, referrals, online reviews, key message pick-up,… • Increased marketing lead conversion rates• Savings from: • Consumer Insights. • Brand protection. • Reduced marketing costs. • Reaching PR objectives faster, better, cheaper: • Increased awareness, reach, relevance, engagement,… 2
  3. 3. ROI CostsCommon costs for social customer serviceprograms: • People, • Process, • Technology. 3
  4. 4. ROI Formula ROI = (Gains - Costs)/Costs x 100 ROI is shown as a percentage. 4
  5. 5. Sample ROI: Client Case Study #1 Sales revenues from Marketing Program(Medium-sized brand for baby care products.) 5
  6. 6. Challenge1. To lead and own the conversation on baby care WOM channels.2. Increase awareness, reach, relevance, share of voice, positive sentiment in online conversations about diapers compared to competitors.3. Educate moms on the new concept of Babies’ Stage of Development (BSOD) to generate interest for diaper product. 6
  7. 7. Solution1. Create online presences and invite parents to share and learn about their babies’ development.2. Develop online PR program for baby care websites targeted at parents to build up a WOM channel to increase influence among parents and establish/drive loyalty among consumers.3. Determine ROI of program. 7
  8. 8. Projected program stats (conservative)• Average volume of social conversations • Before: 1,380,000 in previous 6 mo. • Goal: Add 168,000 convos over a 6-mo period (12% increase). • Add 5,000/mo from registered users uploading photos and essays to branded site. • Add 10% to convo volumes = 23,000 other convos/mo in 3rd party blogs, their own tweets, etc.• Social media sentiment • Before: 42% positive, 36% neutral, 22% negative • Goal: increase positive sentiment• Sales and Revenue • Before: • Annual sales = $156M • Sales/convo before program = $56.52/convo • After: Increase annual sales and value of purchase 8
  9. 9. Formula for Revenue Gain Revenues = Impact x Reach x Yield Influenced convos * We look at changes before program versus estimates of expected after results. 9
  10. 10. ImpactImpact= Positive sentiment x Listening Rate= 42% x 10%= 4.2% 10
  11. 11. Reach = Extent of online footprintReach= 1,380,000 convos in previous 6 months= Avg of 230,000 per month= 5,000 posts/mo on website+ 23,000 other convos/mo across web (blogs,tweets, etc).= 28,000 convos/mo= 168,000 add’l convos total for 6 mo 11
  12. 12. Influence factor= Impact x Reach= 4.2% x (168,000 convos)= 7,056 influenced convos for 6-mo period.* Influenced convos = # of impacted, add’lconvos. 12
  13. 13. YieldAdd’l sales= (Rev/convo) x (# Influenced Convos)= $56.52 x 7,056 convos= $398,805 13
  14. 14. CostsPeople costs= $49,000 for employees for 6 moProcess costs= $163,000 for agency for campaignTechnology= 60,000 community solutionTotal costs = $272,000 14
  15. 15. ROI FormulaROI= (Gains - Costs)/Costs x 100= ($398,805 - $272,000)/($272,000)x 100= 47% 15
  16. 16. Actual program statsRegistered users = 38,700 (29% higher)Total conversations across social web = 196,560(17% higher)Social monitoring = 44% positive (+2% climb)Revenues/convo = $61.61 (9% higher)Actual Sales Impacted = $532,842Actual ROI = 96% (2x higher than forecast) 16
  17. 17. Sample ROI: Client Case Study #2Consumer Insight Savings(Medium-sized software company.) 17
  18. 18. Challenge and SolutionChallenge - Cut the cost of gainingconsumer insight.Solution – Use social media in lieu of moreexpensive focus groups. 18
  19. 19. Program statsAverage cost per survey or focus group= $15,000Recommended # of surveys per year= 1 before each major release= 2x per year.Total cost of recommended surveys= $30,000 19
  20. 20. Program statsCost of personnel= 1 marketing person working 20% of time onmonitoring= ($112,000 burden compensation) x 20%= $22,400Cost of social monitoring= $6,000/yrTotal costs = $28,400/yr 20
  21. 21. ROI FormulaROI= (Savings Gains - Costs)/Costs x 100= ($30,000 - $28,400)/($28,400)x 100= 6%Recommendation – Do either 2 surveysper year or social. 21
  22. 22. What if?What if company wants ongoing real-timecustomer insights?What would ROI be then? 22
  23. 23. What if costs…Savings Gains= Price of 4 surveys per year= 4 x ($15,000/survey)= $60,000Costs= Cost of personnel = $22,400/yr= Cost of tech = $6,000/yr= $28,400/yr 23
  24. 24. What if ROIROI= (Savings Gains - Costs)/Costs x 100= ($60,000 - $28,400)/($28,400)x 100= 111%Recommendation – Do social media forconsumer insights or do a mix of social mediaand surveys. 24
  25. 25. Contact information Natalie Petouhoff Kathy HerrmannDoctorNatalie@gmail.com info@kathyherrmann.com DrNatalieNews www.kathyherrmann.com @DrNatalie @KathyHerrmann +DrNatalie +KathyHerrmann 25

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