The document discusses different viewpoints on calculating the return on investment (ROI) of social media, providing examples of how both tangible and intangible benefits of social media can be measured. It also presents three case studies showing how organizations have successfully measured the ROI of social media through metrics like increased awareness, improved sentiment, and engagement with target audiences.

1. What is Your
Social Media ROI?
Date: March 26, 2012
Time: 3:15 – 4:30 pm
Hub Tag: #ideas12 LM8
Tom McClintock
This is an excerpt. Click here for the full
presentation.

2. A Presentation By:
Tom McClintock
Colorado Springs, CO · Richmond, VA

3. ―A brand is no longer what we tell the consumer it is
– it is what consumers tell each other it is.‖
– Scott Cook, Co-Founder of Intuit
―Social media changes the relationship between
companies and customers from master and servant,
to peer to peer.‖
– Anonymous
―The ROI of social media is that your business will
still exist in 5 years.‖
– Erik Qualman, author & founder of Socialnomics
Source: AnsonAlex.com

4. Source: Three Ships Media

5. SM Sites Now Ruling Web
2005 2012 (as of March 2012)
1. Yahoo.com 1. Google.com
2. Msn.com 2. Facebook.com
3. Google.com 3. YouTube.com
4. Ebay.com 4. Yahoo.com
5. Amazon.com 5. Baidu.com
6. Microsoft.com 6. Wikipedia.org
7. Myspace.com 7. Live.com
8. Google.co.uk 8. Blogspot.com
9. Aol.com 9. Twitter.com
10.Go.com 10. Qq.com
Source: Synovate Research, Alexa Global Traffic Ranking, Morgan Stanley
Research (2005) – Mostpopularwebsites.net (2012)

6. Viewpoint #1
You can’t—and shouldn’t try to—calculate the ROI
of social media.

7. VIEW 1: No ROI from SM
 Having thousands of followers doesn’t necessarily translate into SM
marketing success
 You can easily measure only some things
• Coupons
• Contests
• Clicked links
• Signups
 Much of SM’s benefit is indirect or intangible—not
an asset purchased and placed on
balance sheet

8. VIEW 1: No ROI from SM
Qualitative Benefits In Each Stage of Your Marketing
Campaigns:
 Research
 Strategic Planning
 Implementation
 Evaluation
Source: Synovate Research, Alexa Global Traffic Ranking,
Morgan Stanley Research

9. Viewpoint #2
You can—and must—calculate the ROI of SM.

10. VIEW 2: Calculating ROI from SM
Low investment in SM leads to high ROI when
organizations:
 Have a clear business strategy
 Aren’t afraid to jump in
 Make imaginative use of social
channels, customer engagement and
brand relationship
Source: Petersen, Rob. 34 cases that prove social media ROI,
http://barnraisersllc.com/2010/10/33-13-social-media-case-studies-prove-roi/

11. Must all SM ROI Be Sales-Based?
If your goal is sales, you can
measure ROI using the standard
financial formula:
(Return – Investment)
Investment
But what if you’re, say, an
Association…with returns less
tangible, e.g., raising consumer
awareness about your industry?

12. New Math
BarnRaisers and others realize that social has not only
decentralized and disaggregated, but it’s also dematerialized
—things are less tangible
Less Tangible Today
• Publishing • Hollywood Studios
• Content • Trade Shows
• Workplace • Friendships
• Corporate Structure • Business Contacts
• Pricing (Freemium Model) • Assets, too!
 Great Idea #1: social redefines how we generate and
value returns in a less tangible world

13. New Math
 Great Idea #2: Untethered, ROI metrics can now go beyond
sales dollars to include Retention, Research and Sentiment
values as major currencies to track your messaging
• Message-Point Delivery—for associations often industry viewpoints,
not product features
NSI CLIENT CASE: AMERICAN CHEMISTRY COUNCIL
• Brand Investment—your promise to constituents
NSI CLIENT CASE: UNIVERSAL MEDIA’S PROMOTION OF DISNEY’S JOHN CARTER
• Drip Marketing—maintaining mindshare
NSI CLIENT CASE: AMERICAN NURSES ASSOCIATION

14. Don’t Base ROI on Sales
If Sales isn’t Your Goal
Great Idea #3: when sales aren’t the goal, calculate the ROI
Return using the Persuasion Index
Defined by 5 levels of agreement:
• Strongly agrees (5)
• Partially agrees (4)
• Neither agrees nor disagrees (3)
• Partially disagrees (2)
• Strongly disagrees (1)

15. Don’t Base ROI on Sales
If Sales isn’t Your Goal
 People are not easily persuaded: typically, even the most
persuasive message point is only going to shift a person one level
 Therefore, conversion equals increasing the target’s agreement
level by one, a ―persuasion‖
—equivalent to making a sale in retail
 Valuation based on advertising cost
• If you spend $20,000 on an effective display ad presented to audience of
100,000 that will convert 1 in 5, you value each persuasion at $1

16. Five Steps to Calculate SM ROI
 Step 1: Identify Objective sales, retention, market research—or
for most associations—sentiment
 Step 2: Define Metrics
• sales: thank-you page visits from tweeted landing page
• retention: repeat customers/Facebook posts
• market research: likes to announcement of potential new
product/number of Facebook fans
• sentiment: shift in percentage of conversation participants who agree
vs disagree to message point over time
 Step 3: Estimate SM campaign costs labor + ad spend +
premium value
 Step 4: Estimate SM Return against Objective via Metrics
 Step 5: Measure and report regularly

17. NSI CASE 1: Sentiment Measurement for
American Chemistry Council
 ROI: Message Point Delivery
 Problem: Regulators can’t keep up with
the latest in materials science, like Life
Cycle Assessment (LCA)—a methodology to
measure a building’s lifetime
environmental impact
 Objective: Raise Sentiment for LCA
Across Target

18. NSI CASE 1: Sentiment Measurement for
American Chemistry Council
 Goals:
 Increase web traffic by 10% by December 2011 (+60%)
 Create regular weekly blog content on highest visibility sites
 Use Social Media to reach public and key Building & Construction
audiences

19. NSI CASE 1: Sentiment Measurement for
American Chemistry Council
PHASE 1
of 3
 Alterian’s SM2 is the No. 1 platform for collecting
& analyzing SM data
 SM2 powers NSI’s listening platform,
ReputationConnect™
 ReputationConnect™ provides data for analyzing
changes in customer sentiment

20. NSI CASE 1: Sentiment Measurement for
American Chemistry Council
 Methodology: 4-Phase Strategy
PHASE 1: PHASE 2: PHASE 3: PHASE 4:
Listening Strategy via Increase Change Blog and
ReputationConnect™ Social Voice Sentiment Twitter
Listening Platform Outreach

21. NSI CASE 1: Sentiment Measurement for
American Chemistry Council
PHASE 2
of 3 Increase Social Voice
 Facebook page
• Pay-per-click ads
• Regular posts
• Posting key Facebook messages
on association’s website
Results: Increased FB ―likes‖ from 165 in
January 2011 to 2,523 in March 2012 ROI Calculations:
Return Metrics: Fan Growth, Shares, Post
Likes, Uploads Per Fan, Fan Valuation,
Group Membership, Event Attendance
Investment Metrics: Campaign Labor,
Contest Premium Costs
Compare to: FB PPC Cost to generate
similar activity

22. NSI CASE 1: Sentiment Measurement for
American Chemistry Council
PHASE 2
of 3 Increase Social Voice
 LinkedIn
• Initiated Profile improvements to attract
connections and began outreach campaign
• Sharing LCA-related messages
ROI Calculations:
Return Metrics: Connection Growth,
Shares, Post Likes, Comments, Retweets,
Recommendations, Company Follows,
Event Attendees, Event Follows, Group
Membership
Investment Metrics: Campaign
Labor, Contest Premium Costs
Compare to: LI PPC cost to generate
similar activity

23. NSI CASE 1: Sentiment Measurement for
American Chemistry Council
PHASE 3
of 3 Change Sentiment: Identify & participate in
SM conversations
 Identified Relevant Conversations through
ReputationConnect™
 Recruited ―Sentiment Softball‖ Team Members
from Downstream Members to Join Conversations
 Tossing ―Sentiment Softballs‖ to Infielders

24. NSI CASE 1: Sentiment Measurement for
American Chemistry Council
ROI Calculations:
PHASE 3
of 3
Change Sentiment: Gauge
sentiment impact Return Metrics: Visitors to
pages displaying testimonials,
persuasions
 Repurpose Positive Investment Metrics:
Mentions as Testimonials Listening-platform analysis
on other Online Compare to: Paid placements
Properties and endorsements
ROI Calculations:
Return Metrics: Persuasion value of third-party  Convert Neutrals to
endorsement x # of positive mentions per average
advocate x typical advocate reach
Positives through
Investment Metrics:
Repurposed Content
Listening-platform analysis
Fear of Electromagnetic Field Exposure beneath power lines
Compare to: (a) display ads and (b) public-relations & cost $25 billion (1979-1999) paid by the Utilities Industry,
legal costs of junk science spread via Internet despite lack of even a single successful lawsuit

25. NSI CASE 2: Sentiment Measurement
for Universal Media & Disney’s
John Carter
 ROI: Brand Investment
 Problem: Marketing for Disney’s $350mm
John Carter, adapted from Edgar Rice
Burroughs’ 1912 classic ―A Princess of Mars,‖
confused audiences: false rumors were fueling
social backlash that the story had appropriated
works such as Avatar, Dune and Star Wars—
which it had helped inspire.
 Objective: Improve Image and Debunk
False Plagiarism Rumors

26. NSI CASE 2: Sentiment Measurement
for Universal Media & Disney’s
John Carter
 Messaging
• As one of the first sci-fi characters in
existence, John Carter has been an
inspiration for generations
20 Feb 2012:
• Share Universal Media’s re-edited
trailer http://www.youtube.com/watch?v=-
BxeHQY1NuM
• Universal Media’s Teen Reading
Project promoted Burroughs’ series as
―the Harry Potter of its day‖ Recognition from John Carter Director
Stanton led to coverage by CNN,
accelerating positive coverage of the film in
both social and mainstream media.

27. NSI CASE 2: Sentiment Measurement
for Universal Media & Disney’s
John Carter
ROI Calculations:
 Methodology: Inspire grassroots science- Return Metrics: Persuasion value
of third-party endorsement x # of
fiction fans to post message points positive mentions per average
advocate x typical advocate reach
• January Investment Metrics:
Listening-platform analysis
Compare to: (a) display ads and
(b) public-relations & legal costs of
junk science spread via Internet
• February

28. NSI CASE 3: Sentiment Measurement for
American Nurses Association
 ROI: Drip Marketing
 Problem: 24/7 patient care allows
little time to navigate the overwhelming
flood of healthcare information, so
nurses are turning to social networks on
mobile devices when they can. The
American Nurses Association (ANA)
must therefore understand and
participate in this ever changing topic
stream.
 Objective: Analyze daily healthcare
conversation streams to provide
opportunities for ANA to make available
its resources.

30. Data Assumptions and Tools

31. If You’re Not Measuring,
You’re not Listening

32. Listening Platforms Today
 Ability to analyze, manage, track and report
on your Social Media monitoring and
engagement efforts.
 Flexible dashboard.
 Analysis widgets, streamlined reporting,
integrated workflow capabilities and an
Insights platform with integrated CRM.

33. Listening Platforms Today
 Integrated Marketing Platform
combines campaign management,
web content management, email &
social media monitoring tools.
 Social Media Console captures and
analyzes SM data.
 SM2 provides key reports, data
warehouse & sentiment analysis.

34. Contact Information
Tom McClintock
NSI Partners
719.328.0042 x801
tom@NSIpartners.com
www.NSIpartners.com