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Measuring Social ROI: The CIO's Role

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Measuring Social ROI: The CIO's Role

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Social media marketing may be all the rage, but few companies are measuring results with any level of precision. The research would indicate that only 14% of senior marketers whose companies use social network marketing say they are tying their efforts to financial metrics. With social media becoming so engrained in the way companies do business, measuring its contribution on a wing and a prayer is no longer enough. CIOs need to help enforce disciplined approaches to website analytics, synchronizing metrics to capture and track leads and building 360° views of the customer.

Social media marketing may be all the rage, but few companies are measuring results with any level of precision. The research would indicate that only 14% of senior marketers whose companies use social network marketing say they are tying their efforts to financial metrics. With social media becoming so engrained in the way companies do business, measuring its contribution on a wing and a prayer is no longer enough. CIOs need to help enforce disciplined approaches to website analytics, synchronizing metrics to capture and track leads and building 360° views of the customer.

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Measuring Social ROI: The CIO's Role

  1. 1. Measuring Social ROI: The CIO’s Role Paul Gillin Author: The New Influencers Secrets of Social Media Marketing Social Marketing to the Business Customer
  2. 2. Click to Right Time is edit Master title style Perceived Value of Social Business Increased market share 81% 17% 2% Decreased costs 37% 53% 10% Improved talent retention 58% 37% 4% Improved speed to market/innovation 65% 30% 6% Improved product/service quality 68% 28% 4% Improved collaboration with partners 65% 30% 5% Improved brand or stock value 67% 29% 4% Improved marketing/sales effectiveness 84% 13% 2% 0% 20% 40% 60% 80% 100% 120% Advantage No Impact Disadvantage Source: Economist Intelligence Unit Survey of 329 Business Leaders, 2012
  3. 3. Click Another Channel? style Just to edit Master title Who Has Primary Responsibility for Social Business Marketing and branding 41% Marketing Communications (e.g., Public Relations) 40% Distributed throughout the organization 17% Sales 16% Customer service 11% Human Resource 10% Research and Development (R&D) 8% Education and Training 7% Centre of Excellence 6% Source: Economist Intelligence Unit Survey of 329 Business Leaders, 2012
  4. 4. Click to edit Master title style Executives See Greatest Benefit of social engagement in… • Project management • Innovation 17% • Collaboration • Efficiency gains • Cost savings Yet only 17% have 81% responsibility well- agree that social distributed throughout engagement has the organization tangible benefits Source: Economist Intelligence Unit Survey of 329 Business Leaders, 2012
  5. 5. How to Share Influence ClickWeedit Master title style PRE MEDIA AGE MASS MEDIA AGE SOCIAL MEDIA AGE Talk face to face Personal blog Comments on blogs Phone call Social network page Comments on websites Talk face to face Talk to shop worker Widgets Viral emails Phone call Consult a professional Video sharing site Auction websites Talk face to face Talk to shop worker Readers Letters Photo sharing site Wish lists Talk to shop worker Consult a professional Phone in; TV / Radio Chat rooms Ratings on retail sites Readers letters SMS Message boards Reviews on retail sites Phone in; TV / Radio Email Social Bookmarking Price comparison sites Instant Messenger Chat room Social shopping sites Consumer influence channels Twitter: @pgillin Source: Universal McCann Erickson
  6. 6. Customer Service Matters Click to edit Master title style Service Topic Consumers who General Consumers who have have not used social population used social media for media for customer customer service service Additional amount consumers 11% 13% more 21% more will spend for excellent service Have not completed intended 49% 55% 83% purchase because of poor customer experience, previous 12 months Number of people customers 9 15 42 tell about good customer service experience Number of people customers 17 24 53 tell about poor customer service experience Twitter: @pgillin
  7. 7. Click to edit Master title style “Companies that are highly effective communicators had 47% higher total returns to shareholders over the last five years compared with firms that are the least effective communicators.” Towers Watson 2009/2010 Communication ROI Study Report
  8. 8. Click to edit Master title style “Our data show that fully networked enterprises are not only more likely to be market leaders or to be gaining market share but also use management practices that lead to margins higher than those of companies using the Web in more limited ways.” McKinsey 2010 survey of 3,249 executives
  9. 9. Service With a Smile • 55% of respondents became a customer of a company because of its reputation for great customer service • 40% began purchasing from a competitive brand simply because of their reputation for great customer service • 85% of consumers said they would be willing to pay more over the standard price in order to ensure a superior customer experience. - RightNow Technologies 2010 Survey of 2,217 North American consumers
  10. 10. There are business benefits to encouraging customers to talk publicly – whether 81% positive or negative agree 67% agree Responsibility distributed Responsibility assigned throughout the organization to one department Source: Economist Intelligence Unit Survey of 329 Business Leaders, 2012
  11. 11. Adoption of social channels is strong; with 59% of organizations having adopted Twitter and 60% adopting Facebook, and almost 85% of those who have adopted one, have adopted both together. However, adoption seems to have been the easy part. Justification, integration, and strategic measurement continue to be the most challenging aspects of implementing new social channels. - ThinkJar/Sword Ciboodle survey of 400 customer service practitioners, 2012
  12. 12. Disconnect When selecting a new channel for customer service, who drives the decision? Internal team Customer research Consultants/integrators Customer co-creation Analysts and pundits Other 0% 20% 40% 60% 80% 100% Source: ThinkJar/Sword Ciboodle, 2012
  13. 13. New Channels of Complaint Companies are quick to deploy the Where Crises Originate Blog latest social media technology, yet 20% most have not prepared for the threat of social media crises…we found that more than three-fourths Twitter could have been diminished or 18% YouTube averted. 22% --Altimeter Group Communi ty Facebook Social Media Crises Reaching Mainstream 22% Other 14% Media 4% 10 8 6 4 Data source: Altimeter Group, 2011 2 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
  14. 14. The Sales Funnel Click to edit Master title style Suspects Qualified Prospects Hot Prospects New Clients Image Credit: Retail Sales Systems, LLC Twitter: @pgillin
  15. 15. Flipping the Funnel Click to edit Master title style Respond & Iterate Invite Engagement Listen Go Where the People Are 15
  16. 16. ClickFlattening It title style And to edit Master Source: Monitor
  17. 17. Click to edit Master title style Twitter: @pgillin @pgillin
  18. 18. Today, Integration Means “Everything” Value of Specific Marketing Communications Programs 100 75 10 of 14 achieved 50 50% top 2 box score 25 0 Public Internet Word of In-store/ Direct Social Mobile Relations Mouth/Viral Point of Sale response Networking Marketing advertising General Search Engine Sales Event Sponsorship Branded Videogame Advertising Marketing Promotion Marketing Entertainment Advertising Source: Association of National Advertisers, 2010
  19. 19. Room for Improvement % of Companies Measuring ROI 30% 25% 20% 15% 10% 5% 0% Social Network Mobile Email Direct mail Marketing Advertising Marketing marketing Source: Columbia University/ American Marketing Association 2012
  20. 20. What CIOs Can Do • Set up listening posts • Get people focused on analytics that matter • Invest in marketing automation • Integrate customer service and external data for 360º customer view • Drive consensus on ROI measurement
  21. 21. Opportunities in Listening Click to edit Master title style LinkedIn Answers Quora
  22. 22. 38 Minutes on Twitter Click to edit Master title style Twitter: @pgillin
  23. 23. Click to edit Master Theystyle What the Heck Are title Thinking? Epson reported that revenue per visitor nearly doubled after the reviews were launched. Twitter: @pgillin
  24. 24. What We Usually Measure Click to edit Master title style Hits Traffic Unique Visitors Visits Likes Followers Bookmarks Page Views Clicks These Indicate Activity but NOT Engagement
  25. 25. Terms of Engagement Click to edit Master title style Downloads Subscriptions Repeat Visits Comments Shares Retweets Bookmarks Employment applications Pages/visit Lead forms Forwards Phone calls Ratings Reviews
  26. 26. Measuring the Immeasurable Click to edit Master title style Lift Studies Headline Counts Store visits Speaking Invitations Net Promoter Score Coupons redeemed Employment applications If You Can Measure It, You Can Calculate Its ROI
  27. 27. Click to Things Thattitle style Oh, the edit Master You Know! Thanks to Web Analytics… March 30 April 4 April 9 Prospect reaches website Prospect responds to e-mail Prospect attends through search query "small invitation for "Choosing Small webcast, stays 45 minutes and business accounting," views Business Accounting Software" submits a question related to four pages and subscribes to webcast 30 minutes after e-mail legal practices. newsletter. is sent. April 10 April 12 Prospect clicks link in webcast Prospect downloads trial summary e-mail to visit product version of your small business description page. He downloads accounting software for legal PDF of product brochure about practices. software for legal practices.
  28. 28. Click toMarketing ERP for edit Master title style Graphic provided by Ifbyphone. Sources here
  29. 29. Click to editSocial title style CRM Goes Master
  30. 30. Stagger Activities Click to edit Master title style White Paper Promotion Timeline Task Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Home page link E-mail newsletter E-mail blast Blog promotion Twitter messaging
  31. 31. Look for Impact Click to edit Master title style
  32. 32. Lead to edit Master title Click Gen Excellence style 73 blogs 17 bloggers 600% jump in leads Top quality “Get engineers talking to engineers and get everyone else out of the middle.” Rick Short, Marcom Director @pgillin Twitter: @pgillin
  33. 33. A Reader is aMaster title style Click to edit Lead Each blog has the option to ask a question of the engineer @pgillin
  34. 34. Basic Business Metrics Click to edit Master title style Lifetime Value of a Customer = (Longevity * Revenue) * Margin Conversion Rate = New Customers/ Visits or Leads Value of a Lead/Visitor = Visitor * Conversion Rate * Lifetime Value
  35. 35. ClickLet’s Make it Real style OK, to edit Master title Typical customer Curly spends $10,000/year with you Curly is with you for five years Your profit margin is 10% Lifetime value of Curly is ($10,000 * 5) * .1 = $5,000
  36. 36. Click to edit Master titlea Visitor Applying ROI: Value of style Monthly Visitors 10,000 Conversion Rate .5% Lifetime Value $5,000 Calculation (10,000 * .005 * 5)/10,000 Value of a $25 Visitor
  37. 37. Value of a Blog Click to edit Master title style Monthly Search Traffic 3,000 Estimated Traffic w/Blog 4,000 Value of a Visitor $25 Monthly Value of a Blog $25,000 Monthly Blog Expense $6,000 ROI ($25,000-$6,000)/$6,000 316%
  38. 38. Value of Twitter Click to edit Master title style  You send 50 tweets a month…  Generating 1,000 visitors to your website…  2% of whom become leads…  5% of whom become customers. Therefore, the value of a tweet is: (1,000 * .02 * .05 * 5000)/50 = $100
  39. 39. Click toYou! Master title style Thank edit Paul Gillin Site: gillin.com 508-656-0734 Blog: paulgillin.com paul@gillin.com Twitter: pgillin Twitter: @pgillin

Editor's Notes

  • Customer ExperienceReport
  • The problem is that we’ve defined integration by using moretouchpoints. In that same ANA survey, marketers were asked how important various communications platforms are to their marketing plans. And amazingly 10 out of the 14 platforms received a top 2 box score – very important or important – of 50% or more. So we’ve moved from a world where one media was dominant to a world where everything is important. We would say, however, that using more media does not constitue “integration”. Especially in a world where we are still adapting creative from TV.
  • 17:07

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