The document discusses measuring return on investment (ROI) from social media. It notes that most marketing dollars are spent on awareness and interest rather than later stages of the purchase funnel. This does not help prove ROI to leadership. The document then outlines how social media data can be used to better measure impact on purchase intent, purchases, and loyalty when aggregated at scale. It provides examples of how sentiment analysis and purchase intention metrics can provide insights into sales fluctuations and the impact of promotions.

1. www.empowerresearch.com
Social Media ROI: Stop. Don’t Run Away!
Debjani Deb
Managing Partner
EmPower Research LLC. 2011 Listen. Learn. EmPower Listen. Learn. EmPower
1
Tuesday, June 07, All Rights Reserved.

2. Your Consumers are Online Today
14% 21% 31%
66%
Of online 14% either publish 21% post ratings 31% update
Americans now a blog/ web page or comments in social
use social media or upload video online forums networking sites
HOW MANY TURN TO SOCIAL MEDIA WHEN MAKING PURCHASES
Travel Apparels Personal Care Food/Beverages Groceries
28% 26% 18% 26% 17%
Sources: www.sanfranciscosentinel.com, www.blogs.forrester.com, Knowledge Networks – May 2010
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3. CONSUMERS ARE EXPRESSING
OPINIONS ON
BRANDS/PRODUCTS/SERVICES
AND LEARNING ABOUT THEM
Paths to success
not yet laid out
THIS RESULTS IN SEVERAL
OPTIONS FOR INVESTMENT/
SPEND
ROI is still murky
THEREBY INCREASING THE
PRESSURE TO EMBRACE THIS
NEW MEDIUM
Cause and effect
is not well
thought out
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4. IN NEXT
MINUTES WE WILL DISCUSS
DISCUSS…
CURRENT ISSUES OF SOCIAL MEDIA MEASUREMENT
THE PURCHASE FUNNEL AND HOW IT RELATES TO SM
BLUEPRINT TO EFFECTIVE MEASUREMENT USING SM
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5. The Marketing Spend Scenario Today
$$$$
Most marketing
$$$$ dollars are spent
today on the first
2 steps of the
purchase funnel
Loyalty
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6. But measuring awareness and interest does not
g
help. The core measurement issue today…
Relevance CFOs are not convinced by absolute
measure such as these.
Leadership will not be DASHBOARDS
content when results are
conveyed as re-tweets, fans
re tweets,
or number of followers
Metrics need to reflect SITE STATISTICS
impact on purchase intent,
purchase and loyalty
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7. Copyright Howard McWilliam. Produced with prior consent

8. Fact 1: External and Internal Stimuli Shaping Brand Perceptions
are Captured in Social Media
Advertisements
Advocacy
Engagement
Online Outreach
Changing brand
perceptions reflected in
ti fl t d i
social media by voice of
the consumer
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9. Fact 2: Investments Made at the Top of Purchase Funnel are
Reflected at the Bottom of Purchase Funnel
$$$$
$$$$ 1
Higher
Purchase
Intent
2
Loyalty
Higher Sales
and Loyalty
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10. So How Can We Use Social Media Data To Measure
BYTES + BRAINS
Aggregate
at Large
Harness Identify
Online Influencers
Opinion
1 2
Aggregation of Insights Understanding Opinion
Universe Leaders
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11. How Does One Aggregate at Large?
Stage -1
Aggregation of unqualified chatter using
tools
Stage -2
Filter by using semantic rules as such as
proximity, NLP or sentiments etc.
Stage -3
Filter by using stratified random sampling
for sub-populations that vary considerably
Stage -4
Analysts led tagging for themes, tonality,
demographic profile etc.
Analysis
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12. Nuts and Bolts of Purchase Intention
+ve
Price
-ve Neutral
Image
I Utility
Utilit
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13. Case in Point: Patient Consideration in Real Time
Hi
The launch of
Product A lost some
its sheen owing to Product B
negative chatter on
areness
its price even when
it was highly
recommended by
opinion leaders.
Awa
Product
A
This resulted in
higher purchase
intent/consideration Lo
for competitor that
was still in pipeline. -Ve Interest +Ve
Size of the bubble indicative of intent
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14. An Example of How Purchase Intent Metrics Impact Returns
Share of Voice
50
40
For a particular 30
cereal brand, it 20
was found that 10
while moms had 0
high awareness, Brand A Brand B Brand C Brand D Brand E
it did not result
in
i actual
t l Actual Purchase Intention
purchase intent 60
owing to poor 50
p
perceived 40
nutritional value 30
20
10
0
Brand A
Brand A Brand B
Brand B Brand C
Brand C Brand D
Brand D Brand E
Brand E
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15. An Example of How Loyalty Metrics Impact Returns
Increase in Awareness Sentiment
The Greenpeace
movement
against Leading Negative
Chocolate Brand
Ch l t B d Sentiment
created a lot of
interest for the
brand.
Week 1 Week 2 Week 3 Week 4
Interestingly,
many more first Loyalist First timers
time customers
bought the brand.
Switchers
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16. Social Media can Provide a Lead Indicator for Sales
Lag Data Marketing Data 1 Promo Data Integrated
Sales Data
g
Insights
3
Social Media Lead Data
Purchase
Awareness Interest Intent
2
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17. Case in Point: Reasoning for Sales Fluctuations
The above result explains that negative
p g
sentiments in the previous months had
Social media some effect on sales performance.
sentiment can be
SALES
used as a lead
indicator for the
point of sale data.
Social media can
explain the drivers
and the ‘why’ of the
peaks and troughs
for sales data
Mon 1 Mon 2 Mon 3 Mon 4 Mon 5 Mon 6 Mon 7
Brand’s Negative Sentiments
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18. Statistical Analysis Reveals Competitor’s Promotion Efforts and
Its Negative Conversation Influences Brand Sales
Competitor promotion spend
affected sales performance in
Competitor’s negative
a negative way
tonality increased sales
SALES
SALES
Mon 1 Mon 2 Mon 3 Mon 4 Mon 5 Mon 6 Mon 7
Competitor Promotion Spend Competitor Negative Tonality
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19. The Mom’s Index a Way to Understand Intent at the Segment Level
Millennials Moms Teens
Understand Mom’s Purchase Intent
outlook towards a Sales
category including
purchase intent of
brands within the
category relative to
each other
Understand teens
perception of a
brand. This index
also lends itself to
understanding
segment based
drivers for sales Month 1 Month 2 Month 3 Month 4 Month 5 Month 6
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20. In Conclusion
Social Media lends itself well towards learning about marketing impact
But focus on pure awareness as a measure is not enough to justify spending
True impact/ROI can be measured if purchase intent loyalty and sales can
intent, loyalty,
be measured
The voice of the stakeholder is a powerful
learning tool that brands should use to
empower and tweak marketing strategies
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