ROI from Social Media – what brands need to do next
Published on June 16th, 2011 by Tom List
Over the past few years, working in the UK social media industry, I have attended many conferences and events. Content has varied widely with debatable levels of useful takeaways. Brands like to share their ‘Do’s and Don’ts’ lists based on their experience with delegates desperately trying to find ideas that will work in their own companies.
This week, I attended Social Media Results – From Engagement to ROI, in London. There was a distinguished line-up of speakers and a high-calibre audience all keen to learn how to drive ROI from social media. Notably, whilst there wasn’t the ultimate golden ticket for showing the equation of net revenue gains everyone is striving to prove ROI to business-owners, there are elements of discussion which are starting to get closer.
My two key takeaways from the Social Media Results Conference were:
- Brand advocates will help you increase incremental revenues. To increase the number of advocates, you need to look outside your “owned” media and reach out into the relevant sections of the social web.
- Social media, like any other marketing channel, requires structured thought and planning. How can you measure what you have not planned?
Many companies are still focused on their “owned” media: Facebook fan pages, Twitter accounts, YouTube channels and the strategies/ tactics which are used predominantly to “entertain” their already won audience. This serves to maintain current advocacy levels and customer retention, but where is the incremental revenue in this model? After Twitter’s crash last Christmas, it is also debateable how safe this approach is. As Fergus Boyd from Virgin Atlantic pointed out, these third-party “owned” media channels are complimentary rather than operational services. What happens if you are totally reliant on Twitter and it is suddenly out of service?
Jeremy Waite from Phones4U spoke of his small team spending 10% of their time producing content and the other 90% engaging in blogs and forums, ultimately to drive people back to their owned properties. Tom Hall, head of communication for Lonely Planet, also alluded to the fact there are three levels to their community. Staff and authors on the first level; members of their forum, Thorn Tree, on the second. But the third level, being the external communities which frequently discuss travel, are not necessarily directly linked with Lonely Plant.
The next logical step for the many companies is reaching out into the social web to drive people to their owned properties. The focus is on incremental revenues to improve business performance rather than farming an existing customer base.
The Phones4U method of spending 90% of their time engaging on “owned” and “not owned” properties is clearly time-consuming and resource-intensive. Efficiencies need to be driven into this practice to identify the media where potential new customers spend their time and those that, as a result of their inherent high influence, can spread a positive brand message. Social media monitoring tools, like Sysomos MAP, is a great solution toward that end.
At the conference, “advocacy” was a word constantly mentioned by speakers and delegates in the breakout sessions. Contacting existing brand influencers as well as market influencers all serves the purpose of building brand advocacy. The end goal is the same for online marketing, customer service and PR activities (i.e., to drive higher levels of advocacy whilst limiting detractors). The more these efforts are aligned as a common goal throughout an organisation, the greater incremental revenues should be.