Social Business ROI: Myths and Successes

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Social Media ROI

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.

Social Media is NOT free

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:

Social Media ROI

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.

Part 2: Social Media Chaos: How To Manage The Chaos

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This is Part 2 of our 2-Part series on Social Media Chaos.

In “Part 1: Social Media Chaos: The Shifting Sands of the Business Landscape”, we present the chaotic marketing environment created by social media.

To recap the last few paragraphs of Part 1, here’s how companies fall victim to hasty mistakes in each of the three Acts of Social Media Chaos:

  1. While hurrying to catch up in social media, companies pass over careful planning, instead flinging themselves into the social media fray without checking to see which channels are right for them, which can be left out, and whether or not they’re reaching their audience.
  2. Companies struggling with social media talent find themselves rapidly switching from one strategy to another as leadership changes, or else never settling upon a social media strategy that works for their business.
  3. Measuring the success of social media with the same ol’ marketing metrics is a little like trying to measure the width of a canyon using a speedometer. Companies not only need to rethink marketing strategies, they also have to rethink how they will measure social media success.

How to Manage the (Social Media) Chaos

As we stated in Part 1, the chaotic marketing environment created by social media can still be navigated by the savvy marketing professional. Here’s six tips for managing the chaos.

How To Manage The Social Media Chaos?

  1. Good social media may look spontaneous, but organization is still a must. Altimeter Group, a research-based consulting firm, found many large corporations managing an average of 178 social media accounts. As a result, businesses are struggling to coordinate their marketing message across different channels and prevent brand fragmentation. Social media management software is emerging to help businesses manage these various accounts; your marketing department would be wise to invest in a tool like this to assist with organizing, tracking, and measuring social media campaigns.
  2. Live in the present, look to the future. They say that those who don’t know history are bound to repeat it. When websites came on the marketing scene, too many businesses wrote them off at first – exactly as many would later write off Facebook, Twitter, blogging, and YouTube. Don’t make the same mistake three times: Make sure your social maedia marketing team lives in the present, not the past, while it simultaneously keeps an eye on the future.
  3. Speaking of the future, look at your mobile device. Smartphones are no longer the next “big thing;” smartphones are a big thing that’s already here. What is your company doing to reach out to mobile users, especially social media mobile users? How have you optimized your website for them? How are you making your brand a part of their on-the-go lifestyle? If you don’t have answers to these questions, you need to find them quickly.
  4. Got talent? Get it. Marketers very much need to either recruit or create social media talent within their organizations. However, the next generation of (social media) marketers that you build should be defined by their creativity, curiosity, and flexibility, not just a simple checklist of computer skills. For example, you don’t just want a Facebook wiz; you want someone who can envision a post-Facebook world – because the time will eventually come, perhaps sooner than any of us can guess, when Facebook will become MySpace and some new network will reign supreme.
  5. Be brave enough not to imitate. You may feel safe by looking at what a successful competitor is doing in social media and imitating their model. Yet remember what your mother asked you all those years ago about copying your friends: “If your friend jumped off a bridge, would you?” Indeed, many companies have jumped (or were pushed) off bridges in the last several years. The iPhone and Droid dethroned Nokia; online video streaming and Roku boxes stopped the meteoric rise of Netflix. Follow the advice in tip #4 and succeed without being a copycat.
  6. Charles Darwin and Social Media?Remember Charles Darwin. Charles Darwin observed that it wasn’t necessarily the strongest or smartest species that survives a challenging time; it is the species that is most capable of adapting. If we could boil “Social Media Chaos” down into one statement, it would be this single, astute observation.

This is Part 2 of our 2-Part Social Media Chaos Series.

In “Part 1: Social Media Chaos: The Shifting Sands of the Business Landscape”, we present the chaotic marketing environment created by social media.

Remember Me? I’m Your Customer.

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social media

You already know how to build your brand through social media marketing. You’re already on top of the changes that Facebook announced at the 2011 f8 Developers’ Conference. You’re also well-aware of the fact that you need to interact with your social media consumers, not just constantly pitch to them. As such, you’re always looking for ways to increase interaction and dialogue with Facebook fans.

You follow all the social media rules of engagement because you want to build your social brand. That’s fine – building your social brand is your job. However, have you ever stopped to ask yourself what’s in it for your fans and followers? You know what you’re getting out of your social media relationship with them; what are they getting out of it?

The better you understand what your social media followers are getting from their relationship to your brand, the better and faster you will be able to build your social brand. Let’s have a little Being John Malkovich moment and travel inside your followers’ heads.


1. Social media consumers want to save money

One of the greatest perks to social media consumers is the ability they gain to find deals and save money. They are no longer chained to whatever they can find at their local retail stores; unfettered, they prowl Facebook pages and join email lists with the intention to save a couple bucks on products they like or think they might like.

Here are some social media statistics you need to know:

  • 88% of women and 70% of men say that promotions were what motivated them to subscribe to emails from a company (Source:
  • 40% of consumers who “Like” a Facebook page do so in the hopes that they will receive discounts; this is the top reason they click “Like” (Source:
  • Another 36% of consumers say they follow Facebook business pages to get a freebie or coupon (Source:
  • Put the two above statistics together and you’ll see that 76% of Facebook fans are hoping to get a deal of some kind
  • 43.5% of Twitter users start following a brand in the hopes of deals and discounts; this is also the number one reason for following a Twitter user (Source: Blog)
  • 70% of social media users who follow brands report that they have participated in a sweepstakes or other brand-sponsored contest (Source: Blog)


social media brands

2. Social media consumers want to display their personality

Interestingly enough, the same social media study that found the #1 reason for following a brand is the somewhat predictable wish to save money found that the #2 reason for following a brand is to publicly display their brand affiliation. Receiving discounts was the top reason for 40% of respondents; showing support for a brand was the top reason for 39% (Source:

In other words, Facebook users will frequently “Like” a page simply for the purpose of self-expression. Understanding this, you may wish to think more about what following your page says about a person and how you can tweak that meaning to reach out via social media to more people and the right people.


3. Social media consumers want to be entertained

While people use a site like Google principally to find information, people are often using sites like Facebook, YouTube, and Twitter for the same reasons that they turn on the television: They want to be entertained.

As part of their drive to be entertained, Facebook users continue to consume Facebook apps at a rapid rate. Facebook’s own statistics state that “more than 500 million people use an app on Facebook or experience Facebook Platform on other websites” each month (Source:

Facebook games continue to blow the minds of their creators. Data from September 2010 reveals this about Facebook games:

  • 53% of all Facebook users play social games, or 56 million each day
  • Unlike the typical gamer profile, these gamers are 69% women
  • 50% of all Facebook logins are for game playing
  • The average gamer plays for 210 minutes each month



4. Social media influencers have their own agenda

Much has been written about creating “brand evangelists” — influential bloggers and consumers who will build your brand for you just because they like you so darn much. However, it’s important not to be sucked in to the evangelism about brand evangelists. Don’t be naïve; most of these influencers review, write about, and promote your brand and products as part of building their own brand.

Independent reviewers and bloggers are mostly interested in building their own fan base and sphere of influence. When you reach out to an influencer, you must remember that their agenda is just as self-promoting as yours is. Therefore, ask yourself how your brand can benefit the influencer before reaching out and suggesting a collaboration.

Now that you’ve gotten a glimpse of what’s going on inside your followers’ minds, reexamine your social media outlets and check to see if you are actually meeting their needs. You might be great at posting surveys and responding to comments right away, but have you really taken the time to consider why your social media fans are following you in the first place? Once you align the content you provide with the reasons consumers follow your brand, your social media success will skyrocket.

Don’t know why your existing fans are following you? Here’s a novel approach: Ask them.

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Have some thoughts on this topic or general comments? Share them below.

Top 3 Picks: Best Social Media Infographics

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Here’s Stephen Paul’s Top 3 picks from the latest round of Social Media Infographics. Say what you will about the tidal wave that is social media: it’s over-hyped, a fad halfway through its 15 minutes, that surely won’t be around in a few years’ time.


Here’s Stephen Paul’s Top 3 picks from the latest round of Social Media Infographics.

First Up Infographic. Say what you will about the tidal wave that is social media:

it’s over-hyped, a fad halfway through its 15 minutes, that surely won’t be around in a few years’ time. But take a look at the Infographic below – the steep curve of the user growth rate in all age ranges and demographics, and the continuing pervasiveness of social media into every facet of work, play and life in general. It’s hard to argue that social media hasn’t changed forever how we interact and connect online. See for yourself. Here’s the Infographic:

Social Media Growth Infographic
Source: The Growth of Social Media: An Infographic

Next up Infographic. Small businesses are becoming savvier about social media.

And, increasingly, smaller-scale operations are turning to Facebook, Twitter, LinkedIn, and other social media channels for promotions, customer acquisition, and sales leads. An impressive 75 percent of small businesses now have a presence on a social media site. Interestingly, 27 percent of small businesses are on Facebook, while 18 percent reside on LinkedIn, and just 7 percent use Twitter. This new data comes from CrowdSpring, a Web design firm that crowdsources all of its projects and that created the new Infographic below. Probably the most revealing social media stat here: 64 percent of Twitter users are more likely to buy the brands they follow or for which they’re a fan, compared with 51 percent of Facebook users. Here’s the full breakdown on usage at the top social media spots:

Small Business and Social Media Infographic
Source: Crowdsourced Logo and Graphic Design by crowdSPRING

Last up Social Media Infographic. From hurricanes and floods to earthquakes and wildfires, natural disasters affect the United States every year.

When it comes to being prepared for a disaster there are a number of basic items to include in your emergency kit, like water, food and a battery-powered or hand crank radio. However, armed with your smartphone and a knowledge of social media, you can be better prepared for an emergency situation. Here’s the Infographic:

Infographic - In Case of Emergency Use Social Media

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What’s your favorite Social Media Infographic or thoughts? You can share your comments below.

5 Social Media Marketing Tips to Increase User Engagement

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If you keep up with social media marketing news, you already know that if Facebook were a country, its 800 million users would make it the third most populous nation in the world. And, besides being the largest social network in the world (by far), it’s now the most popular website in the U.S., consistently beating out Google for the top spot.

Social Media Marketing

If you keep up with social media marketing news, you already know that if Facebook were a country, its 800 million users would make it the third most populous nation in the world. And, besides being the largest social network in the world (by far), it’s now the most popular website in the U.S., consistently beating out Google for the top spot.

However, just because Facebook is the country’s stickiest site doesn’t necessarily mean that your Facebook page has any “stick” to it at all. How do you connect with your customers on Facebook, get them to engage and keep them coming back for more? Here are five social media marketing tips for increasing user engagement on your Facebook page.

Social Media Marketing Tip #1: Pick the low-hanging fruit first

Whenever you’re trying to improve your social media marketing, consider starting with the low-hanging fruit – the changes that you can make right away that offer a big return. When it comes to increasing user engagement on your Facebook page, the low-hanging fruit includes:

  • Respond to questions and comments right away
  • Post regularly
  • Run a poll, a quiz, a contest
  • Change your Facebook URL to something easy to remember (i.e., don’t allow your URL to stay as “”)

Social Media Marketing Tip #2: Time your posts to reach more users

We’ve found that big brands who post Facebook content outside of business hours have 20% more user engagement than brands who only post during the work day. And there are a number of social media marketing studies that concur with this.

Facebook user engagement for big brands peaks at three points each day: 7am EST, 5pm EST, and 11pm EST. In other words, user engagement peaks before people go to work, after they get off work, and just before bed time. If you post during the work day, there’s a good chance you’re missing out on your social media marketing user engagement windows.

However, different markets peak at different times. The entertainment industry peaks over the weekend – times when people might check out a movie or a concert. For the media industry, Mondays are weak, but the other weekdays are strong. Auto and retail brands see the most engagement on Sundays; healthcare, beauty, travel/hospitality, and fashion all peak on Thursday; and the business and finance industries peak on Wednesdays and Thursdays. If your business falls into one of these industries, post your content on days when user engagement is already naturally high.

Social Media Marketing Tip #3: Short ‘n sweet (except for URLs)

Posts of 80 characters or less – shorter than a long Twitter post – generate the most user engagement. However, when you include a full-length URL, as opposed to a or tinyurl, people are three times more likely to click on it.

Along the same lines, if you want a post to generate more user engagement, ask them to respond to a simple question at the end of the post, such as “What new widget would you like XYZ Company to produce?” Do not put the question at the beginning of the post or buried somewhere in the middle – it is far less likely to be seen.

Social Media Marketing Tip #4: Get out of sell mode

Too many businesses still don’t understand that Facebook is about interaction; a Facebook page is not a newspaper advertisement and it’s not even a company website. If all your posts are sales-oriented — “Check out our sale!”, “Look at our new products!”, “Did you know we just got our fall items in?!” — very few people are going to comment on it, like it, or share it.

From a business perspective, Facebook is less like a sales meeting with a prospective new client and more like a networking meeting where you have a chance to meet contacts and build relationships. To be effective at social media marketing, instead of constantly talking about your products, throw in an occasional picture of a colleague’s new puppy or a bit of industry news from a website that’s not your own.

Social Media Marketing Tip #5: Ask for content in a compelling way

You might remember what poor Domino’s went through a few years ago when a couple of not-thinking-straight employees posted a video on YouTube demonstrating how to cough on, sneeze on, and otherwise molest an innocent pizza before shipping it out to the customer.

[youlist vid=”OhBmWxQpedI” width=”400″ height=”300″]

The video went viral, but Domino’s handled it well. One of their innovative responses was to fight fire with fire: They encouraged customers to send in photos and videos of the delicious pizzas they had received from Domino’s. The best entries would win $500 gift certificates. Dominoes leveraged social media marketing skillfully.

In the same way, consider following Domino’s lead and holding a video contest or photo contest on your Facebook page. Make the contest prize something worth competing for, then watch the content and social engagement pour in.

These are just five social media marketing tips to get your creative juices flowing when it comes to increasing user engagement on your Facebook page.

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