The Road Less Travelled: Social Business ROI

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In 2006, most companies believed that Social Media was nothing more than a passing fad. And as with most disruptive technologies or business models in the early stages, there was no ROI in sight. But some companies began experimenting with Social Media and started to see its potential for new sales, marketing and support channels. And the revolution began.

Just a small group of companies and dedicated people, let’s call them Social Starters, got Social Media going. Mostly, Social Starters came from marketing and customer support areas. They started out by simply monitoring customer comments and feedback. Social Starters often became team leaders when social teams were eventually put into place. Many of the first teams started focusing on specific Social Media channels; instead of experimenting with numerous ones like the Social Starters did at the very beginning. Since different channels can produce different results for different organizations, this more focused approach resulted in more measurable results and they were encouraging. Soon, Social Media policies and procedures became more formalized and standardized including training and tools. With that, social teams were better able to determine how Social Media added to the value of the business.

Over time, more measurable and positive results started to come in. It became the norm for companies to listen and interact with the customer and as a result they were seeing an increase in satisfied customers, more traffic to their Websites and social channels, and an increase in sales and repeat customers; all directly attributable to Social Media initiatives. We were starting to see solid results of Social Media contributing to Business ROI. And as the results became impossible to deny, not only did all levels of the organization became more accepting of Social Media — the highest-level company executives became public advocates. Companies started to think of, and refer to, themselves as Social Enterprises.

Today, a true Social Enterprise listens to and considers customer concerns a top priority. It can anticipate customer needs, and market and promote products far quicker than ever before. Customer satisfaction and loyalty is at an all-time high. Customers remark that their needs are anticipated and their ideas are influential. Employees are more productive, stakeholders are more engaged and campaigns are more efficient since there is no guess work on what customers want and need. This is a major breakthrough for enterprises of all shapes and sizes, including cause companies, non-profits and other business organizations both public and private. And, probably most important of all, today’s true Social Enterprise relates to its social communities as real people: customers, employees and stakeholders; instead of just a way to make a profit. Although the disruption and revolution phases are almost over and Social Business ROI is getting stronger, there’s still more to do.

Sources/References:
(1) Social Business ROI: Myths and Successes
(2) Google Analytics Social Reports Ties Social Channels to Business ROI
(3) Social Business and the Growth of Shared Value [Infographic]

Google Analytics Social Reports Ties Social Channels to Business ROI

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Marketers and business owners are now one step closer to being able to track the true value of social channels to their Business ROI within Google Analytics. Google just released their latest social tracking tool “Social Reports” and it’s fully integrated within Google Analytics.

The main reason that social media is so hard to measure is that most social interactions occur off of the business’ website. For example, there may be a vibrant and active Facebook community having constant conversations about a business product, but all these conversations are happening off of the main business website, which means that Google Analytics can’t track what the end result of that conversation is – until now. Google Analytics with Social Reports attempt to bring together social actions that are happening on the website with social actions happening off the website to provide marketers a more accurate, complete picture of business ROI.

How Social Reports Work: An Imagined Scenario

Let’s imagine that Sally is a woman in her mid-twenties who follows her favorite vintage clothing store on Twitter and Facebook. On Monday, she sees a tweet on her smartphone about a new sale on go-go boots. Intrigued, she clicks the link and scrolls through the pictures. She’s on her lunch break, though, so she doesn’t have time to do anything more than look.

A few days later, Sally is still thinking about the go-go boots and goes back to the site. This time, she happily places an order for a pair of bright red, knee-high go-go boots.

The old Google Analytics wouldn’t have been able to tell the difference between a Sally who’d originally clicked through thanks to the tweet versus a Sally who discovered the go-go boot sale page on her own. However, the new Google Analytics with Social Reports can tell the difference.

To describe which social media channels and campaigns eventually result in a sale, Google Analytics with Social Reports is borrowing a word from basketball: assist. An assist is earned when you pass the ball to someone else, who then scores a basket. Applied to Google Analytics with Social Reports, an “Assisted Social Conversion” is a sales or goal conversion that originates with an action from a social media site. In Sally’s case, Google Analytics with Social Reports recognizes that Sally originally came to the site thanks to Twitter, left, came back later and eventually made the purchase. This is an “Assisted Social Conversion.”

Google Analytics with Social Reports also provides a measurement called “Last Interaction Social Conversions.” This means that the action the user took immediately preceding a conversion was a social action. For instance, if Sally had clicked on the link in the tweet and immediately purchased the go-go boots, this would have been counted by Social Reports under the “Last Interaction Social Conversions” header.

Social Reports: Which Social Network is Boosting Your Business?

Another feature of the Google Analytics with Social Reports is the ability to compare and contrast the value of one social channel to another. For example, Sally’s favorite vintage clothing store tweeted about the sale on go-go boots, but they also might have posted a photo album of boots on their Facebook page, as well. When the store’s marketing team examines the results in Social Reports, they might find that the tweet led to 20 conversions, while the Facebook photos yielded 60 conversions.

Which social media channels will Google Analytics with Social Reports enable marketers to better track? To name a few:

• The big ones – Facebook, Twitter and of course Google+
• Digg
• Disqus
• Blogger
• Meetup
• Reddit

Except for Facebook, these are the biggest names in Google’s Social Data Hub Partners, but there are more and Google intends to keep growing the list. As of right now, Facebook is not a Social Data Hub Partner, which means that Google can’t provide as much drill-down data to its Analytics users for Facebook as it can, say, with Reddit. Even though the drill-down information for Facebook is not available, the new social tracking still improves ROI data, especially when marketers combine information from Analytics with Facebook Insights.

How to Get Started with the New Social Reports

Google Analytics first started to offer basic social reports back in the summer of 2011. This was the time when you might have noticed that the look/feel of your Google Analytics page shifted. At that time, you should have updated the Google Analytics code on your website. If you didn’t, installing that code is the first step to better social media reporting.

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We’d like to hear your thoughts on Google Analytics Social Reports, Social Business ROI or Social Media – the good, the bad and the ugly. Share them in the comments section below.

Social Business ROI: Myths and Successes

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Facebook is the 850 pound gorilla of social media. With over 850 million active users, Facebook is rapidly closing in on being used by one in every seven people on the planet. From subsistence farmers in rural Africa accessing Facebook on their mobile phones, to tweeting protestors in the Middle East, to grandmothers living in Michigan sharing their family photos on Flickr, it seems that almost everyone is living a part of their life on a social network.

In some of our more recent articles, we’ve been writing about Social Business ROI and that enterprises typically achieve highly desirable business outcomes through carefully planned and executed social channels.

Businesses have flocked to join their customers on these social networks, but some are still skeptical about the social media craze. The question that presidents and CEOs keep asking their marketing departments (and it’s a question that marketing departments often have a hard time answering) is, “What is the return on investment in social media?”

Some business people take this question even further, asking the more cynical “Is there a return on social media, or does social media have more marketing bark than bite?”

While the skeptics make some valid points, social media ROI does exist and it can be measured. Some businesses are already doing just that. Here’s a closer look at the myths surrounding social media ROI and the businesses that are proving the skeptics wrong.

Three Social Media ROI Myths

Some social media marketing myths still persist despite the growing understanding of how to use the new marketing channels. Here are three of them.

1. Social media is free.

Signing up for a Facebook page or a YouTube channel may be free, but that doesn’t mean social media is. At the very least, successful social media content still takes time to plan and develop, and someone in the business is being paid for that time. However, the good news is that once a social media marketing strategy has been decided upon and people have been allocated to the project, the cost of social media remains relatively flat, while profitability increases over time. Whether or not profitability happens, though, totally depends upon the success of the social media campaign.

2. It’s impossible to assign a monetary ROI value to social media marketing.

Although marketers are still learning how to measure the ROI of social media efforts, stating that the monetary value of a social media campaign cannot be measured at all is not true. As you will see in the next section of this article, many businesses are already successfully measuring the dollar-value of their social initiatives.

3. Social media costs more than it makes.

This is a “myth” that is actually true–for businesses who are poorly executing social media campaigns because they don’t understand their audience, don’t understand their technical tools, or just don’t understand social media itself. Businesses who do not invest the time it takes to learn about their audience, how to grow that audience, and how to interact with that audience will ultimately spend more on social media than social media brings back to them, but this is not the fault of social media itself.

Six Examples of Social Media ROI

Want to see some recent concrete examples of businesses who are measuring the results of their social media campaigns? Try these on for size:

1. Best Buy’s innovative “Twelpforce” enlists knowledgeable, everyday employees to answer customer support questions via Twitter. Best Buy estimates that this “social help desk” saves them $5 million annually in support. [1]

2. Bonobo’s social business became 13 times more cost effective (CPA) in acquiring a new customer from Twitter than from other marketing channels. [2]

3. Paramount Pictures’ #Super8Secret (hashtag) Promoted Trend created a tremendous spike in conversations: Tweets of the hashtag reached nearly nine million impressions in less than 24 hours and mentions of the movie skyrocketed to more than 150 per minute. Receipts for the sneak preview exceeded $1 million, and Paramount said weekend box office surpassed expectations by 52%. [2]

4. Petco’s 1% of shoppers use “Ask and Answer,” that influences a 10% increase of revenue on their website. [3]

5. Sprint’s monitoring of online conversations about their brand enabled them to tweak their social media campaign messaging. As a result, the company says it picked up an extra $133 million in revenue. [4]

6. Sephora Community Users spend 2.5 times more than average customers, and their superfans spend 10 times more. [1]

Example Sources:
[1] Lithium Technologies, 2011
[2] Twitter, 2011
[3] Altimeter Group, 2011
[4] MotiveQuest, 2011

These are just six examples of hundreds of big brands that are successfully measuring the real financial impact of their social media initiatives. If you want to explore these and other examples, contact 4thWeb.

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Do you have your own social business or social media ROI story or thoughts? Share it in the comments section below.