Social Media and ROI: Likes and Follows Only Go So Far

ConvoNation
Adam Schreiber CEO & Managing Partner at ConvoNation, Senior Consultant & Partner at B&R, ConvoNation.com

Posted on June 30th 2011

There is an ongoing conversation within the Social Media industry that is recently becoming a global consensus; the number of fans/likes on Facebook or the number of followers on Twitter do not provide enough metric data for brands to prove that their information is doing it justice. Instead, it's the number of connections and engagements that are truly needed. 

The beautiful thing about Social Media is that it has the ability to engage customers and stakeholders, facilitate stream-lined interactions and potentially lead to increased sales. The only problem is that with the platforms that exist right now there is a major gap between consumption and creation.

Brands seem to think that if a user ‘likes" their page or ‘follows them, they are able to get sufficient user information that will help them meet customer interest. But the fact is that this information is incredibly limited. Users are not sharing what part of the brand they like and, or do not like. Even when a user is part of a group on a site like Facebook, they are limited to writing a comment on the brands' wall. Maybe they'll take part in a sweepstake, but that seems to be the extent of the interaction. Nothing more, nothing less.

Consider the media landscape in social media. CNN has nearly 4.5mm followers on Twitter, which is only about 1.8% of their regular viewers. On Facebook, people share nearly 30 billion pieces of content per month. This includes third party links from media outlets and blogs, company research, and photos and videos, etc. Now consider the corporate industry; Nike has 105,605 followers on Twitter, Research in Motion has 461,481 followers.

These numbers seem staggering at first glance, until you consider that RIM makes over 100,000 phones everyday. Their Twitter followers are only around 2% of total customers. Nike's Twitter followers also represent less than has 1% of their customer.

Social media is incredibly valuable and the current mainstream sites have done an amazing job moving the Internet in the right direction. But now it's time to look at the big picture. And that is true brand engagement. It is not a bad thing to only have about 1% of your consumers in direct contact with you. In fact those people may be the top 1% you are looking to engage. The issue lies in what marketers are looking for the "ROI".

The problem is that we are not currently able to quantify ROI of social media. Social media builds relationships through engagement that can lead to sales and advocates. eMarketer has found that more than 85% of consumers make brand decisions based upon social media influences. It is difficult to quantify these relationships and they monetize more slowly than normal transactions, but they are still very valuable, perhaps even more valuable than anything we have had in marketing to date. So, if someone does not want to fund social media because they cannot get a hard fix on ROI or user demographics, well, they had better catch up with modern consumer engagement or fall hopelessly behind. Brands can continue to create campaigns and network on Facebook to build an audience which, overtime will create useful content (hopefully). And after that content is created, companies can then find appropriate ways to provide insight to their stakeholders. It is a lengthy process, but one that saves money in the long run.

Engagement is key in today's market. It's not necessarily based around a strict demographic that older models once were. It's about finding channels and connections with those passionate enough to debate a topic or product. The sooner marketers drop the old-school mentality the better off they will be. It's a rich field of passionate people out there. Stop treating them as if you're better than they are and start engaging with them on their level and on their terms.

ConvoNation

Adam Schreiber

CEO & Managing Partner at ConvoNation, Senior Consultant & Partner at B&R, ConvoNation.com

Adam is the CEO & Managing Partner of ConvoNation.com, and a Senior Consultant & Partner at Brand and Reputation Management. He has extensive experience in digital strategy, reputation management, and communication planning. Adam has previously worked in global communications in both digital technology and healthcare at Hill & Knowlton and Euro RSCG, serving such clients as Hewlett-Packard, Amgen, Deloitte, Yahoo!, and JNJ among others. He is a sought after speaker on topics surrounding reputation implications in social media.
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Comments

Brad - As a brand and reputation management consultant, how do you manage the identity of your clients' brands when customers have so much opportunity to shape the message via social media?

Randy, that's a brilliant question, and something I've been talking about recently with some of our clients. So here are my thoughts. You need a reputation management system in place within the client's organization. It consists of three parts planning, monitoring and reponding appropriately. You could begin by cateogrizing customer conversations and messages. For e.g. lets says you find via listening to online conversations, that there are 3 broad type of conversations. One about your product features/enhancements they wish were there, or about your customer service or lack of it, and maybe about your pricing. These conversations specifically map to 3 different business functions within the organizations. You'd then need to ensure your have the appropriate response mechanisms in place(teams and processes) to address these queries and enhance these conversations. This is one approach of managing the brand identity. Going down this path you'll shortly realise that internal company resources are not enough especially if you're not a very large organization. You'll realise that an additional approach is to ensure you have a solid advocacy program in place. This will go a long way to ensure that beyond the business entity your fans and advocates help advocate and protect your brand identity.

Looking forward to hear what Brad has to add :-)

 

Regards,

Sanjay Shetty

Tha's a good article Adam. It hit the nail right on the head since many companies are just so caught up with getting a 'Like' on their FB page that they forget how important it is to engage their customers for more valuable information on improving their products or a company as a whole. Thanks for sharing this valuable information.

Lauren

http://InstanteStore.com

 

The conversation about quality vs quantity is an indicator that social media is coming of age. Emphasis is changing to reflect longer-term considerations. What must also be taken into account is that social media drive people to websites, to events, to take action that may not actually happen on the social media site. If I read about an event, I may just go to it. Or I may go to the website to donate. How does that get counted in ROI?

 

 

Thanks for the all the comments, all. Randy & Sanjay, I assume when you speak of Brad you mean me?

I'd have to agree with Sanjay's response. Planning social media action (or non action) is a huge must before doing anything. Just because people are on a site does not mean that they want or need your [the business] evolvement. I wold say to, Randy, shaping messaging should not be a goal. Shaping a user experience should be what you aim to do. People are individuals - they feel how they feel. Some for good reason, some, not so much. But as a company the goal is to engage with those who both like you and don't. In today's world, simply responding with brand messaging won't cut it. Users/consumers do not respond well to the old ways of market messaging. it is a two way dialogue now. Before making decisions, we listen and then engage - not from a pedestal, but as an equal.

What we say at B&R is that when dealing with clients the biggest wins are going to come from reshaping your oppositions thoughts. This does not come from "shaping" messaging. Brand advocates are a must, but even the old outlook on that is changing. Winning in messaging comes from heart felt engagements. A lot of times companies think that they need to pull bad comments or have a "fire drill" if someone with clout said something negative about them in public. In fact, we argue that you should embrace those the most. Use those negative experiences as a platform to show that this is no acceptable as a company. No one will ever have 100% satisfaction. The sooner companies realize that they will always have an opposition the better their social media plan will work.

Consumers are just as strong, if not stronger than the companies themselves. We no longer go right to the company and trust what they say is what they do. Instead we google them, look into their offering, post a status asking if anyone has dealt with them and then check out reviews. All of this is done before a decision is ever made. With that said, that is a HUGE benefit to a company who is interested in doing things properly and not just interested in shaping messaging to cut down on the bad. The internet is fueled by emotion. Sometimes people are upset and sometimes people are happy. As a business, your goal for social media should be to sway those who have formed their "own" opinions of you. Turn to them as special interest groups and go for the win. Engage on the same level and see outstanding results. Continue to act as if your company is more powerful and better than the consumer and you will see terrible results.

 

Thanks again for the comments, I hope I addressed your question.

 

Adam 

Great article.  I work in a social media team for an up and coming company and its crazy too see how people can obtain so many "likes" or followers and have it really mean nothing.  Engaging with people is crucial to building relationships that are worth while.