For many companies social media can be a “bright shiny object” or a response to what “everyone else is doing.” In these situations social media is used without an end goal in mind and without the proper metrics in place to determine what impact social media has on marketing.
This week I have been doing research on measuring the impact of social media (SM) on the bottom line. One of the things that has stood out the most to me is that while SM can be seen as a low cost alternative to traditional marketing mediums, there remains a significant time commitment to monitor and analyze conversations to determine impact.
To assess the contribution of social media, an organization needs to do the following:
- Establish SMART goals for social media
- Determine 2-3 metrics for each of the goals
- Analyse the data to see how the strategy is meeting its goals
As described by Radian6, the purpose of social media is not just to have “eyeballs” but what matters is having the right “eyeballs” and then driving them to some sort of action. To prove some kind of action you have to:
- Look at average monthly reach across networks
- Count the number of conversations originating from one of those channels during the month
- Establish a ratio of potential reach to actual progress in the metric (ie. conversations, blog subscribers)
- To determine dollar value per fan. Divide value of online referred transactions by the total number of people you reach
Social media is like any other marketing tool its effective use is dependent of the use of metrics and quantitative and qualitative analysis.
Sources
Radian6: Practical Social Media Measurement and Analysis- http://www.radian6.com/wp-content/uploads/2010/03/Radian6_eBook_March2010.pdf
Marketing Sherpa: Measuring Social Media’s Contribution to the Bottom Line: 5 Tactics- https://www.marketingsherpa.com/article.php?ident=31648