Know what ROI really means and get faster executive approval for your social business and media initiatives.

1. What social business ROI really means www.kathyherrmann.com ©2010 Kathy Herrmann

2. Who is using social media to gen revenues and cost savings ?

3. And the reason is because…

4. Don’t be “ myth”taken … Avoid social media myths that will torpedo your initiative.

5. Social media is free . That would be never …Even a small program has personnel costs. Larger programs? Add in higher people costs plus technology.

7. Metrics = R eturn O n I nvestment Big honking no. Web visitations Page views Registrations Customer Satisfaction Etc. Metrics are important…But as leading indicators of revenues (or cost savings).

8. What executives really want to know about a corporate initiative.

9. The purpose of business is to generate revenues or increase profitability . Get executive attention by showing them the money associated with your social initiative.

10. Convert social benefits (like influence, loyalty, engagement, etc.) into monetary terms…. …yes, really.

12. Perform valuation hand-in-hand with the strategic vision and definition, as well as tactics.

13. Strategic definition = verbal or written expression of what you plan to accomplish. = Valuation = numerical view of the strategy.

14. 1. Start with cash flow … … of Gains and Costs.

15. NPV = Time-value of cash flows. Incorporates risk via discount rate (also known as cost of capital). 2. Determine Net Present Value

16. 3. Determine ROI Determined from the NPV of Gains and Costs. ROI = Gains - Costs Costs

17. What cash flows where?

18. Money out = Social Media Costs

21. Money In = Social Media Gains

22. Revenues due to social initiatives = x x Reach How many are you connecting with Impact Who’s paying attention Yield How much is their spend

24. Now you’re ready to be an executive champion helping them make an informed decision about investing in social business.

25. Go forth and make social!

26. About

28. Thanks! www.kathyherrmann.com ©2010 Kathy Herrmann