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  1. 1. Wharton Interactive Media Initiative <br />Measuring Success of Social Media<br />Steve Ennen <br />Managing Director, Lecturer in Marketing<br />Wharton Interactive Media Initiative<br /><br /><br />
  2. 2. Wimi Overview<br /><ul><li>Brings a passionate data-driven perspective to media businesses (content distribution and information acquisition) in a way that no other business school in the world can match.
  3. 3. Distinguishes itself with a tight focus on the interaction between content provider and user, capitalizing on the wealth of individual-level data that is exploding at the crossroads of commerce, technology, and entertainment.
  4. 4. Is dedicated to bringing world-class research rigor to better understand these complex interactions in order to drive new business strategies and tactics that will reshape the media landscape.</li></ul>WHARTON INTERACTIVE MEDIA INITIATIVE<br />
  5. 5. Wimi Infrastructure<br />Global network of research & corporate partners<br />Researchers from Wharton, LBS, MIT, Wharton doctoral and MBA students<br />Projects underway with:<br />WHARTON INTERACTIVE MEDIA INITIATIVE<br />Funding from nine<br />Corporate Partners and key individuals to study data-related issues relevant to several industries<br /><ul><li> Wharton Lab for Publishing Innovation</li></li></ul><li>Overview<br />Today<br />Part 1 Overview,<br /><ul><li>Why you are here
  6. 6. Number one key metric, the holy grail
  7. 7. Cut through the clutter
  8. 8. What is the real-time web
  9. 9. Basic universal marketing measurements
  10. 10. Developing a measurement strategy</li></ul>WHARTON INTERACTIVE MEDIA INITIATIVE<br />
  11. 11. Why you are here<br />The world transforms<br />
  12. 12. Why you are here<br />Number one, key metric, the holy grail!<br />
  13. 13. Why you are here<br />Number one, key metric, the holy grail!<br />
  14. 14. Why you are here<br />Challenges to measurement:<br /><ul><li> Soft metrics – meaningless or close to meaningless
  15. 15. Faux metrics – fabricated by technology
  16. 16. Data deluge
  17. 17. Confusion</li></ul>& Clutter<br />
  18. 18. Cut through the clutter<br />Buzz and business<br /><ul><li>To earn a free burger, Facebook users download the Whopper Sacrifice Facebook application and dump 10 friends unworthy of their weight in beef. After completing the purge, users are prompted to enter their addresses and the coupons are sent out via snail mail.
  19. 19. In about 60 days, nearly 240,000 Facebookers had been de-friended for the sake of a hamburger. That amounts to more than 7,000 coupons for free Whoppers.
  20. 20. Facebook stopped the campaign because of privacy concerns.</li></li></ul><li>Cut through the clutter<br />Buzz and business<br /><br />
  21. 21. Cut through the clutter<br />Buzz and business<br />
  22. 22. Cut through the clutter<br />Buzz and business<br />No evidence of increased sales<br />
  23. 23. Cut through the clutter<br />Hot social media metrics<br /><ul><li> Influencers
  24. 24. Engagement (verb, not a metric)
  25. 25. Sentiment
  26. 26. Earned vs. paid media
  27. 27. Real time</li></li></ul><li>Cut through the clutter<br />Influencers <br />
  28. 28. Cut through the clutter<br />Influencers<br /><ul><li>What is an influencer? </li></ul> Dark and Disenfranchised<br /> Small Town Pride<br /><ul><li> How valuable are influencers?</li></ul> Marketers hope to affect influencers to short cut mass marketing<br /> The research shows…<br />
  29. 29. Cut through the clutter<br />…not so much<br />Becker (1970) and Watts and Dodds (2007) have raised doubts on the importance of opinion leaders in speeding up the acceptance of new products<br />More recent research by Coulter, Feick and Price (2002) and Godes and Mayzlin (2009) provides conflicting answers to the question whether heavy users are more influential than light users, an issue of obvious relevance to the identification and targeting of likely influentials.<br />“Opinion Leadership and Social Contagion in New Product Diffusion” <br />RaghuramIyengar, Christophe Van den Bulte<br />The Wharton School, University of Pennsylvania, et al<br />
  30. 30. Cut through the clutter<br />
  31. 31. Cut through the clutter<br />Bottom line: <br />influencers have smaller spheres of influence than current buzz purports. <br />
  32. 32. Cut through the clutter<br /><ul><li> Engagement </li></ul>(verb, not a metric)<br />“Seriously though, I am surprised that your analysis pegs me as one of the most engaged users to your site. I subscribe to your RSS feed via Yahoo, and eventually get around to reading each new posting, but my access is very occasional. Your email to me was the first that I was aware of the posting.”<br />posting on analytics site by its “most engaged visitor”<br />
  33. 33. Cut through the clutter<br />Sentiment analysis<br />Sentiment analysis or opinion mining refers to a broad area of natural language processing, computational linguistics and text mining. Generally speaking, it aims to determine the attitude of a speaker or a writer with respect to some topic. The attitude may be their judgment or their affective state (that is to say, the emotional state of the author when writing) or the intended emotional communication (that is to say, the emotional effect the author wishes to have on the reader).<br />
  34. 34. Cut through the clutter<br /><ul><li> Perceived characteristics of the company and brand
  35. 35. Perceived characteristics of the competitor
  36. 36. Opportunities to defend or build the organization's reputation
  37. 37. Channels for revenue growth
  38. 38. Potential threats
  39. 39. Most effective methods and venues for engaging with consumers
  40. 40. Keywords and trends for effective marketing strategies</li></li></ul><li>Cut through the clutter<br />
  41. 41. Cut through the clutter<br />Earned vs. paid media<br />Union Square Ventures partner Fred Wilson sees the future<br />As "earned," not paid, media <br /><ul><li>Earned media: viral, usage, utility, UGC, conversations
  42. 42. Paid media: ads
  43. 43. (Owned): brand-created content with the hope of moving to earned</li></ul>USV is funding companies that address the new marketing paradigm, from earned-media platforms such as Twitter and social video site Boxee<br />
  44. 44. tomorrow’smeasurement<br />The next challenge<br />The data collection radically increases speed through<br />Real time measurement<br />
  45. 45. What isthe real-time web?<br />“Real-time is the hottest topic now” <br />Facebook executive, Jan 21 2010<br />Google recently declared real-time search to be one of the biggest unsolved challenges it faces. Announced real-time search in December. <br />Google’s inked partnerships with both Facebook and MySpace to pull in data in real-time. For Facebook, that means public Facebook Pages, and for MySpace, it means any stream data that is publicly available. This is on top of the partnership that the company announced with Twitter in October.<br />
  46. 46. What isthe real-time web?<br />NYTimes put a link to a new real-time view of all its news stories on the front page of its site. <br />Facebook announced a new feature that will let users be notified instantly when their friends interact with media related to themselves on the site.<br />
  47. 47. What isthe real-time web?<br />Real-time web is the acceleration of the exchange of information brought on by the adoption of new technologies<br />Ubiquity<br />Ubiquity disrupts former paradigms and<br />creates new business opportunities<br />
  48. 48. What isthe real-time web?<br /><ul><li>Real-time collaboration – Google Wave
  49. 49. Real-time search -Twitter
  50. 50. Real-time analytics – social games
  51. 51. Real-time pricing</li></li></ul><li>What isthe real-time web?<br />Real time measurement<br />
  52. 52. Measuring the real-time web<br />
  53. 53. Measuring the real-time web<br />
  54. 54. Measuring Blogs<br /><ul><li> Blogs are, essentially, real time
  55. 55. Reliable gauge of sentiment</li></ul>From a marketer’s perspective there are two ways to measure your blog strategy<br />1. The importance of your own blog<br /> new and returning visits links<br /> Google Webmaster Tools or Bing Webmaster track inbound links<br />2. The interaction with another blog<br /> authority<br /> readership<br />
  56. 56. measuring blogs<br />How is Technorati Authority calculated?<br /><ul><li>Authority is calculated based on a site’s linking behavior, categorization and other associated data over a short, finite period of time.
  57. 57. A site’s authority may rapidly rise and fall depending on what the blogosphere is discussing at the moment, and how often a site produces content being referenced by other sites.
  58. 58. The new Authority calculation differs from the past version, which measured linking behavior over a longer 6 month timeframe.
  59. 59. Links in blogrolls don’t count towards Authority, as they are not indicative of interest in relevant content
  60. 60. Authority is on a scale of 0-1000. 1000 is the highest possible authority</li></li></ul><li> measuring blogs<br />How is Technorati Authority calculated?<br />How does topical Technorati Authority work?<br /><ul><li> Topical Authority measures a blog’s influence within its subject category.
  61. 61. Blogs will appear ranked by topical authority within Technorati’s blog directory.
  62. 62. Factors include linking behavior from blogs and posts in the same category, how well a blog's overall content matches the category in question, and other associated data.
  63. 63. It’s possible for a blog to have authority in several different categories. The authority in each category may be different.</li></li></ul><li>measuring blogs<br />
  64. 64. other social media<br />
  65. 65. other social media<br />Twitter<br />Many people, including scholars, advertisers and political activists, see online social networks as an opportunity to study the propagation of ideas, the formation of social bonds and viral marketing, among others. <br />This view should be tempered by findings that a link between any two people does not necessarily imply an interaction between them.<br />
  66. 66. other social media<br />
  67. 67. Twitter measurements - basics<br /><ul><li>Followers
  68. 68. Use third-party tools to figure out how much traffic your websites are receiving from Twitter.
  69. 69. Track click-throughs on any link you post in a tweet. Some URL shortening services let you track click-throughs
  70. 70. Updates
  71. 71. Frequency/Responses
  72. 72. Keep a tally of questions answered, customer problems resolved and positive exchanges held on Twitter. Do the percentages change over time?
  73. 73. When you offer deals via Twitter, use a unique coupon code so that you can tell how many people take you up on that Twitter-based promotion.
  74. 74. If you have an online presence, you can also set up a landing page for a promotion to track not only click-throughs but further behavior and conversions.
  75. 75. Keywords
  76. 76. Sentiment analysis Tweetfeel, TwenzeTwitrratr</li></ul>.<br />
  77. 77. facebook measurement<br />
  78. 78. Facebook measurement<br />Basics<br /><ul><li>The best practitioners make Facebook less about selling and more about interacting.
  79. 79. Engage with fans and critics.
  80. 80. Listen to what people are saying, good and bad.
  81. 81. Keep content fresh.
  82. 82. Use status updates and newsfeeds to tell fans about specials, events, contests or anything of interest.</li></ul>Measurement<br /><ul><li> Number of impressions and clicks-through
  83. 83. Sharing pieces of content: Defined as “web links, news stories, blog posts, notes, photo albums, etc.”
  84. 84. Keywords
  85. 85. Sentiment</li></li></ul><li>Facebook measurement<br />“Despite the potential of social ads where the social actions of your circle of friends could make the ads more targeted, none of the anticipated positive effects were observed. Despite the promise of mass reach, there was not the corresponding attention or clicks. And despite the use of demographics-based targeting, there was no statistically significant difference between different targets nor the control sample, running during the same time period.”<br />Dr. Augustine Fau<br />SVP, digital strategist MRM Worldwide<br />
  86. 86. Facebook measurement<br />
  87. 87. Facebook measurement<br />
  88. 88. Gaming measurement and metrics<br />Social Gaming<br />
  89. 89. Gaming measurement and metrics<br />Gaming Measurement and metrics<br /><ul><li>How many of the new registered users turn out to be a monthly active user and how many of them are daily active users (DAUs), and what percentage of those daily active users turn out to be purchasers.
  90. 90. The churn rate for social games is high — two to three months for most titles. A good chunk of players — 25% to 33% — play a particular game two to three months before moving on</li></li></ul><li>Gaming measurement and metrics<br />Examples<br /><ul><li>Playdom, sold more than $200,000 of virtual pink Volkswagen Beetles in two days. Its revenue is about $75 million this year
  91. 91. On a recent two-day period, Zynga sold 100,000 "meat grinder" machine guns & 80,000 body armor suits.
  92. 92. Mafia Wars, for example, $10 will buy 42 reward points, enough to purchase a 9mm pistol.</li></li></ul><li>Gaming measurement and metrics<br />The K factor: the k-factor in this context is itself a product of the rates of distribution and infection for an app. <br />Distribution measures how many people, on average, a host will make contact with while still infectious and "infection" measures how likely a person is, on average, to also become infected after contact with a viral host. <br />That is, what is the inherent virality of the application.<br /> (53% said a friend or family member recommended the game).<br /><ul><li>For a new registered user, how many more registered users will that give you?
  93. 93. Then you have to look at the quality of users, </li></ul>as defined by the play rate. <br />
  94. 94. Basic, universal marketing metrics<br /><ul><li>Impressions (exposures and opportunities to see)</li></ul> -an impression is generated each time an advertisement is viewed<br /> -number of impressions achieved is a function of an ad’s reach - multiplied by it’s frequency<br /> -Impressions do not account for quality of viewing<br /><ul><li>Gross rating points – impressions divided by the number of people in the audience for the advertisement. Impressions expressed in relation to the population. GRPs are cumulative across media vehicles
  95. 95. CPM – cost per thousand
  96. 96. Net reach/reach number of people who see a message/advertisement
  97. 97. Average frequency- average number of times an individual receives an advertisement given that he or she is exposed</li></li></ul><li>Basic, universal marketing metrics<br /><ul><li>Frequency response functions – models the reaction of a population to exposure to an advertisement
  98. 98. Effective reach –measures the portion of an audience that is exposed to an advertisement enough times to be influenced
  99. 99. Effective frequency – number of times an individual must see an advertisement in order to register the message
  100. 100. Share of voice – quantifies the advertising “presence” of a brand
  101. 101. Pageviews – number of times a webpage is served
  102. 102. Rich media display time - average time rich media is displayed per viewer
  103. 103. Clickthrough rate number of click-throughs as a fraction of the</li></ul> number of impressions<br />
  104. 104. Basic, universal marketing metrics<br /><ul><li>Cost per click – ad costs divided by # of clicks generated
  105. 105. Cost per order – ad costs divided by number of orders generated (measures cost effectiveness of advertising)
  106. 106. Cost per customer acquired – ad costs divided by # of customers acquired
  107. 107. Visits – number of unique viewings of a site
  108. 108. Visitors – number of unique site visitors in a given period
  109. 109. Abandonment rate – rate of purchases started but not completed
  110. 110. Bounce rate – fraction of site visitors who view a single page
  111. 111. Friends, followers, supporters - measures size of a social network,</li></ul> but unlikely to measure engagement<br />
  112. 112. Measuring social media success<br />Step 1: <br />Understand the environment / Landscape analysis<br />Gain a greater understanding of social media <br /><ul><li> Blogs
  113. 113. Communities/Social Networks
  114. 114. Discussion forums
  115. 115. Ratings and reviews
  116. 116. Sharing
  117. 117. Video
  118. 118. Widgets
  119. 119. Wikis
  120. 120. Traditional media platforms</li></li></ul><li>Measuring social media success<br />Step 2<br />What is your measurement strategy?<br /><ul><li> What are you measuring?
  121. 121. How will you measure success?</li></ul>- Can you clearly define metrics for successes and failure?<br />- Can you determine ROI, ROE?<br /><ul><li> What are the mechanisms for gathering the data?
  122. 122. How do you determine what’s important?
  123. 123. How will you analyze the data?
  124. 124. Who owns it?
  125. 125. How does the information move across the organization?</li></ul>-Dashboards, reports, meetings, enterprise media<br />
  126. 126. Measuring social media success<br />
  127. 127. Measuring social media success<br />
  128. 128. Measuring social media success<br />Four failures of measurement & analytics<br />1. Information is ineffectively shared within the organization - Everyone in the strategic process needs to know<br />2. Goals and the metrics themselves are poorly defined - You should not be spending money or building campaigns just to bring people to your site, you must bring people to your site with a specific goal in mind<br />
  129. 129. Measuring social media success<br />Four failures of measurement & analytics<br />3. Companies either don’t take action or take improper action on results<br />The secret to truly successful marketing is actionable measurement. Measuring your results alone isn’t enough; the key to feeding them back into your sales and marketing process.<br />4. No holistic or cross-platform synchronization<br />
  130. 130. Measuring social media success<br />25 MEDIA MAXIMS, Ken Auletta<br /><ul><li> Passion Wins:
  131. 131. Focus is Required
  132. 132. Vision is Required:
  133. 133. A Team Culture is Vital:
  134. 134. Treat Engineers as Kings:
  135. 135. Treat Customers Like a King:
  136. 136. Brand Often Means Trust:
  137. 137. Every Company Strives to Take the Risks Out of Capitalism:
  138. 138. Every Company is a Frenemy:
  139. 139. The Speed Of Change Accelerates:
  140. 140. Adapt or Die:
  141. 141. “Life is long but time is short.”
  142. 142. A “Free” Web Is Not Always Free: </li></li></ul><li>Measuring social media success<br />25 MEDIA MAXIMS, Ken Auletta<br /><ul><li> Digital is Different
  143. 143. Don’t Think of The Web as Another Distribution Platform
  144. 144. Technology Provides Potent New Targeting Tools
  145. 145. The Web Forges Communities, and Threatens Privacy
  146. 146. Beware The Government Bear
  147. 147. Paradox:The Web Forges Both Niche and Large Communities
  148. 148. More Media Concentration, Yet More Choice
  149. 149. Luck Matters
  150. 150. No More Old Media Magic
  151. 151. No More New Media Magic, Either
  152. 152. Don’t Ignore the Human Factor
  153. 153. There are no Certitudes: “Today, Google appears impregnable. But a decade ago so did AOL, and so did the combination of AOL Time Warner. “There is nothing about their model that makes them invulnerable,” Clayton Christensen, Harvard business historian and author</li></li></ul><li>Contact<br />Steve Ennen, <br />Managing Director,<br />Lecturer in Marketing<br />The Wharton School, University of<br /><br />WHARTON INTERACTIVE MEDIA INITIATIVE<br />