In 1848, James W. Marshall’s discovery of gold in the California territories resulted in a massive seven year migration from the east coast that we remember today as the California Gold Rush. Administrators and laborers alike packed their lives into wagons and caravans and set out with little plan other than getting wealthy.
But the attraction wasn’t simply the promise of gold; it was the promise of easy gold, littering the dirt, steams, and sand that everyone in their day was familiar with.
When it comes to your social media marketing strategy, however, the “gold rush” isn’t everyday people pursuing rare earth minerals. It’s everyday businesses and marketers looking for success on platforms that have become so common in everyday life.
And in one of those beautiful moments of history repeating itself, many brands struggle to find or demonstrate return for their social efforts, modern-day prospectors sifting dirt through their hands. It’s disappointing, since all it takes to strike social media ROI gold is some preparation and forethought.
Laying the Foundation with Expectations
Most marketers (or marketing students for that matter) will tell you that the first step of any marketing effort is defining your goals and KPIs. What they don’t tell you in school is that this step can be exceedingly difficult if you have non-marketing team members helping to set these goals.
Many social campaigns and presences are ruined from the start by unrealistic expectations. A popular example—and one that is forever the bane of my existence while consulting—is the idea of going viral. There are well-documented and effective ways to build reach and audience over time. These processes rely heavily on the ability to track, control, and optimize your presence as you go along. The inherent nature of digital virality (and thepsychology behind it) is that it’s generally uncontrolled and aberrant—so going viral can be a tough goal to strive for.
A good social media campaign should accomplish one of three things overall: it should build your audience, interest your audience, or serve your audience. Good brand presence on a platform means accomplishing all three.
When communicating with your marketing team or the rest of your company at large, try to limit and define expectations within these three buckets. This is primarily useful because each of these areas offer their own form of value to your company: building your audience improves visibility and reduces costs for disseminating content, interesting your audience helps drive traffic and encourage specific actions, and serving your audience affects customer retention and can ease the cost of your other customer service efforts. This makes it much easier to communicate with leadership, and express exactly how your work with provide measurable value for your company.
Earning Your Keep: Direct vs. Indirect Value
So you’ve gotten your brand on board with your social efforts and you’re ready to build out some campaigns that generate value for your company. But how do you actually measure that value? Regardless of the KPIs you’re working with, the two overall ways you can demonstrate ROI is either direct or indirect.
Direct ROI reporting is the most traditional approach, the most accurate and useful measurement—and the biggest headache to actually achieve. Direct ROI tracking is simply the process by which you are able to directly track unique interactions or exposure to social media to an eventual conversion that results in revenue. This sort of tracking is most relevant when you are aiming to interest your audience, and it involves many of the digital tactics, tracking, and analytics that have become commonplace for social media marketers today.
But there’s a big issue with direct ROI tracking on social: social audiences are increasingly resisting directly promotional posting. This isn’t news to most social marketers, but it means that the funnels for driving conversions frequently involve more touch points and circuitous routes to landing pages that can make it difficult to attribute purchase revenue to any number of posts.
This puts marketers between a rock and a hard place: do you opt for direct sales messaging to simplify attribution, or do you embrace the more complex structures necessitated by interesting storytelling that adds more steps for tracking to fail? This also brings into questions numerous other social situations where your activity may not drive direct sales, like expanding your follower count or resolving a customer service inquiry.
Where direct ROI helps measure value by attributing actions to revenue generated, indirect ROI tracking helps by measuring how much cost you’re avoiding. There are two ways you can accomplish this. For the first, you’ll need to understand the total cost of your social activity—this includes everything from ad spend to overhead to your spend on personnel. Once you have these values, start to take stock of some of your average spending points: what’s the average price to earn a paid follower, impression, share, etc.? With these in hand, you can multiply these values against metrics you achieve organically to get a back-of-the-napkin value for the worth of your social activity. It’s important to note that these values are less quantitative than they are descriptive. A single value can’t really tell you much about how much value you’ve brought to your brand, but watching trends over time can tell a powerful story about the growth or decline of your social presence.
You can see the second way indirect efforts can work for your team by comparing service outcomes against other methods they might use. For instance, say a member of your social team responds to a product question that solves the customer’s issue and prevents them from making a warranty claim. In either case, the customer is retained, but your team accomplished it with a $1 interaction rather than through an expensive warranty transaction. Those saved costs can speak volumes for what your team accomplishes for your company.
Story Can Create ROI
The benefit of having two approaches for demonstrating social ROI is less about making your social media platform more valuable, and more about justifying creative approaches within your brand’s marketing efforts. It’s likely that your social team’s understanding of their audience or ideas for engaging content are great, but constantly forcing these into funnels that track to sales may actually be stifling your ability to retain and grow your audience. The goal is to find a process for your team that allows you to standardize the value of efforts across the board so that your stories can have a chance to demonstrate their worth.
Social media marketing strategy is the earth that marketers and users alike are familiar with using. Make sure that that your brand’s stories are the gold that people are looking for.
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