Aug 9 Posted 8 years ago
I must completely disagree with you. I believe you are speaking in theory and not in practice. I've been seeking answers to the MROI (Marketing ROI) puzzle for some time, and every actionable and practical idea I've ever heard provides MROI measures at an aggregate level and not at a granular level.
Just last week, I attended a webinar by an author and professor who specializes in Marketing ROI, and he acknowledged it is impossible to measure ROI of different channels and tactics separately from each other; we just live in too complex of a world.
You speak of how online banners can be measured with metrics that are "basically ROI metrics," but I think your "basically" is hedging. Obviously, you can track a click on a banner ad and know if it created a conversion. That is fine for comparing the relative performance of different banner ads, but it is not measuring ROI. There is a difference. Consider:
- What if the site doesn't have an ecommerce or other conversion action? (This is quite common for CPG and other manufacturers.) Then all you're doing is measuring response rate. Put "free" or promise naked pictures of Britney Spears in the ad and response rate goes up, but that doesn't mean you've increased loyalty, usage, or ROI.
- What caused someone to click on an ad in the first place? The person who clicked may may have previously used the product; or perhaps they saw a print ad for the brand in the same day; or maybe they saw the banner ad four times before clicking--how do you separate the value of the banner for that specific click from all the other exposures that supported the click?
Social media is even more difficult to measure, because it doesn't relate to single exposure or click. Think about the environment in which social media is used by consumers and brands. As an example, consider an automaker that launches a multi-million-dollar campaign:
- They purchase media across TV, print, radio, and online ;
- they create a microsite;
- they post about the microsite from their Twitter profile;
- consumers ask questions or share criticism/praise about the automakers products on Twitter;
- the microsite invites consumers to join a community;
- community members engage each other and invite others to join the community;
- community members are invited to a test drive of the new car when a branded event tour is in town;
- community members are offered an online casual game and some play it others don't;
- the community members are furnished with a widget for their blogs and social media profiles with some level of participation; and
- some members of the community contribute and visit a lot and other don't.
In the end, the automaker sells X cars. While they can understand the Marketing ROI of the entire campaign, how would you separate the value of social media from other media? You can measure plenty--Twitter followers, Twitter comments, number of community members, number of community actions, number of people who showed up at the mobile event; number of times a game is played, number of widgets served--but you cannot attribute ROI to each and every channel or tactic.
Sorry, but I believe too often people speak of ROI in theoretical ways rather than practical ways. In a complex work where consumers are touched by many touchpoints and engaged in a virtually unlimited combination of ways, the idea that we can separate a single tactic--social media or a specific Web 2.0 site--doesn't make any sense.
Aug 8 Posted 8 years ago About loyalty you can measure it easily. You social media efforts have to be directed to a specific objective, which means you should be able to drag people you touch through social media to engage with the brand through a dedicated platform (which may then redirect to the general CRM program, but don't try to connect directly people from conversation to CRM program, that would be foolish). And activity on your dedicated platform can be easily measured. Which means you can calculate ROI of your social media program.
The trick is to not connect directly your social media effort to your CRM program, create a gate to make the user experience user-friendly since you do not do direct marketing (ok yes you're quite doing it, but in a different shape and using different tools). It would be like creating a brand image online advertising and redirecting to a couponing program. You'd lost your prospects and clients, being too straight forward.
And regarding your point on not being able to apply ROI to social media separate from every other activity, the Internet media enable that possibility since you can track people coming and request enough interactions and forms to get data about who they are and why they're here. And taking your example of the billboard, what you can't to offline, you can do online: you can track efficiency of online billboards (banners and other IAB formats) and know what was the best click through rate regarding formats and websites they were on, which is basically a ROI metrics.
Aug 8 Posted 8 years ago
I agree that theoretically you can measure social media using the same metrics as with other business activities, but practically I think that is extremely difficult (bordering on impossible.)
If customer loyalty improves, how does a brand match the loyalty increases due to social media activities from the loyalty increases due to the thousands of other things the enterprise does. Customers can be touched in person, on the phone, in social media, and in other channels--so how do we know an increase in loyalty is applicable to social media efforts. This same inability to split the results from one tactic or strategy from the others is a problem for all metrics--brand equity, sales, etc.
Trying to apply ROI to social media separate from every other business activity is like trying to equate the ROI of a billboard among a campaign that involves Out of Home, Radio, and TV. We can know the entire campaign works, but we can't know a particular billboard has provided positive ROI.
Webinars On Demand
April 05, 2017In the ever-changing world of digital marketing, operational efficiency, quick turn-around times, testing and adapting to change are crucial to...
January 25, 2017While we’ve had access to the Internet since the early 1990s, we’ve only started to experience the full effects of its disruption on public rela...
Video is expected to account for three-quarters of all mobile traffic by 2020. But, creating powerful, effective video requires a significa...
Marketers are constantly seeking to engage with their buyers and drive actions that help buyers move rapidly through their customer lifecycl...