Daily Archives: November 25, 2013

Social Media Metrics: Still a work in progress

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Through my research for this blog I have discovered several different methods to measure Social Media success.  Some try to draw a direct link to sales volumes, while others try to measure web traffic levels and link them back to company objectives.  What I have learned from my research is that there is no shortfall of people trying to find the best way to measure success in this relatively new forum.  There is an endless supply of “10 Ways to Measure Social Marketing” type articles that come up after a quick Google search.  While this can be helpful as eMarketers try to find the metrics that work best for their business, it can also result in companies using the wrong metrics to measure their marketing investments.  With so many options, it can also be easy for eMarketers to pick the metrics that make them look the best to the company’s executives for personal gain!

So what are the metrics that should be used for Social Media campaigns?  I wish I had an answer to this question.  In fact, I wish anybody had an answer!  In my search for the answer, I found that Don Bartholomew (SVP Digital and Social Media Research at Ketchum Inc.) summed it up best in his personal blog posting a few months ago.  I couldn’t agree more with his opening statement, in which he states the following:

“We are at a crossroads in social media measurement. Expectations for rigorous and relevant measurement have risen more quickly than delivery. Too many are fixated on quantitative outputs – speeds and feeds – at the expense of understanding the outcomes achieved by social media marketing and social business. There is still too much emphasis on vanity metrics and not enough on business results.“

Bartholomew goes on to list some of the key steps required to truly have useful Social Media metrics, and the most intriguing one is the requirement to have a standard set of measurements and definitions across industries.  This would create a system whereby campaigns can be measured against each other, and misleading metrics can be abandoned completely.  To my surprise, there is already an international and cross-industry organization setup to reach this goal!  Smmstandards.org bills itself as “A Cross-Industry Effort to Simplify and Unify the Measurement of Social Media”.  This organization met in 2011 and set out the following set of priorities for which standardized measurements should be created:

  1. Content and Sourcing
  2. Reach and Impressions
  3. Engagement and Conversation
  4. Influence
  5. Opinion & Advocacy
  6. Impact & Value

Impact & Value is of most interest to me, as this is where the valuation of programs from a financial perspective would fall in.  I believe that a standardized measurement system will go a long way in validating the benefits of Social Media marketing, and will push the medium further as eMarketers increase presence there.  Smmstandards.org has already made some progress in this regard, and I look forward to monitoring the evolution of their value metrics as Social Media space becomes more and more popular.

Digital Budgets – Where does the money go???

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I’ve read plenty of articles about ways to measure the success of the Social Media campaigns that companies employ, but have not yet looked into how much companies actually utilize this channel over other more traditional ones.  TechnoratiMedia published the results of a survey earlier this year that investigated this very subject, entitled the “2013 Digital Influence Report”.  This survey was completed by 6,000 influencers, 1,200 consumers, and 150 top brand marketers, and provides valuable insight into where companies are investing their Marketing budgets and which online mediums provide the best bang for the buck (in terms of level of influence).

First let’s get grounded on the actual dollars we are talking about.  From the below figure pulled from the TechnoratiMedia report, we can see just how much top brand marketers spend in the Digital channel.  In my experience, it is difficult to repurpose a firms’ traditional channel spend towards new digital initiatives.  This can be a long and drawn out process, but the spend figures in the below table are already classified as digital and we can safely assume that these figures will only increase over time.  Amount spent will obviously vary depending on the size of the firm, but we can see here that we are talking about substantial investment going into the digital channel in 2013.

Now for the interesting part – the report further breaks down the digital bucket into various components, and as can be seen in the below chart, just 10% of this is going towards Social Media at this time.  Display ads account for the majority of digital spend, and this may be because it is the oldest form of advertising in this relatively new world.  I would assume that over time the Social, Mobile, and Search pieces will increase more and more, and new forums will become available that do not exist today.

The above chart also breaks down the Social Media spend into subcomponents, and from this is where the most interesting finding of the TechnoratiMedia report is found.  Facebook is getting by far the largest piece of the Social Media investment pie at 57%, while Blogs receive just 6%.  However when we look at which forums actually influence consumers purchase decisions (as seen in the consumer chart to the right), both of these are tied at 31% response rate.  This strikes me as a very significant piece of information.  It seems that while Facebook is important, Blogs can be equally as effective at what is likely a fraction of the cost.  My learning from this report is that marketers should consider investing more heavily in specifically targeted blogs to get to the influencers, as these are the groups that are impacting the consumers decision to make a purchase.