Lewis writes, “Don’t Say ROI Unless You Mean It
.” Agreed. I see a lot of bloggers wading into unfamiliar territory, starting to spew opinions on measuring return on investment (ROI). It’s easy for anyone with an understanding of business finance to see the shallowness of these analyses. But don’t be surprised – has not knowing anything about a subject ever stopped a blogger from writing about it?
To get to the root of the problem, we first need to go back to school. Marketing has historically been a right-brain discipline, reflected in academic coursework. Left-brained marketers
end up focusing on direct and/or B2B – staying far away from social media.
Fast forward to the top of the food chain. CMOs have a shorter tenure than other executive roles. Why? According to Spencer Stuart
, the firm that publishes the most widely cited statistics on the subject, CEO and CMO agendas are misaligned. CEOs want to see business results – I’d say now more than ever. Marketers can’t counter with, “well, I can’t give you a number, but there sure are a lot of people talking nice about us.”
Social media is easy to use. If you can type in a box and click a button, you can blog. Click the button that looks like “play” and sure enough the video starts rolling. There is no secret to using Twitter. Being a social media user meant that you were an expert…five years ago. Not today.
And so the Emperor set off under the high canopy, at the head of the great procession. It was a great success. All the people standing by and at the windows cheered and cried, “Oh, how splendid are the Emperor’s new clothes. What a magnificent train! How well the clothes fit!” No one dared to admit that he couldn’t see anything, for who would want it to be known that he was either stupid or unfit for his post?
We know the Emperor should’ve just used some common sense. Calculating ROI from social media efforts is no different.
If ROI doesn’t apply to social media marketing, then social media should not be used for marketing.
Karl Havard is Managing Director of Propeller.net
Forget ROI – This will be a tough one!! Measuring the return from the investment in social media is probably impossible today. (Coca Cola has recognised this.) ed note: Would love to learn the facts behind this statement.There are certain metrics which can be monitored such as increase in unique visitors to your site (via social media AND search), increase in brand “buzz”, ultimately increase in sales (if you’re a commerce business). But don’t expect to be able to calculate the Y return from your X investment in social media alone. It can’t be done.
I love creative, creative types and have a strong bent of myself, but the reason I love Digital Marketing is the accountability. Yes, common sense applies as it relates to determining an approach for quantifying “the gains’ and there is certainly a place for Brand Awareness in the metrics mix.
However, the current infatuation with MAD MEN aside, (love of creative for creative sake and be damn the strategic insight of the consumer), I for one, don’t want Social Media to fall victim to the black box syndrome that Creatives and some new technologies, leverage. It works but I don’t know how or why?
Of course Peter Kim and Karl Havard are both right,it is probably “impossible today” depending on how you define “gain from the investment” but certainly worth beginning the journey, which has begun in earnest in many circles.
First to Learn, First to Earn, I always say.
Next up, some real voodoo economic theory (joke), Net Promoter Scores.