If I have heard it once I have heard it a few hundreds times..Where is the ROI in Social Media? Interesting enough, there are some people who will put forth an honest effort to quantify a business’ efforts for social networking. I know, I attempted a few times and like the rest, failed.
The reality of it is…there really is no absolute way to calculate the ROI of Social Media. Why? There are a number of reasons why a true ROI cannot be formulated. Here are a few
- None of the figures offered by any of the social networks on how many people are on their site can be validated, especially by a third party.
- Without valid figures on viewership there is no way to build a formula.
- Same goes for responses to posts. How many responses to a post actually product a sale?
- Even with a coupon, password or some other tracking method used to receive something from a merchant there are far too many ways to manipulate the results.
Of course there are a number of ways to calculate ‘Costs’ of social media. Focusing only on the cost usually is the first mistake many businesses make when they jump into social media. In many cases I have reviewed I don’t blame the business owners highlighting the costs, especially those who paid ten’s of thousands of dollars to marketing strategist and PR firms to be told to use an aggressive marketing plan which produces a moderate level of Spam. This usually is where the hunt for the ROI begins.
The truth of the matter is, ‘The ROI’ ‘n social media is in the ‘doing’. If you or your business is not effectively using social media to establish a presence online there is no ROI to be obtained. The keyword in this statement is ‘Effectively’.
Anyone can join a social network, post a trillion promotional pieces a day and say they are using social media…or at least think they are using social media.
Effective social media comes from the root action word in the phrase which is ‘Social’. When a business goes in to work a social network like a sideshow barker they are not being social. What they are doing is being ridiculous and wasteful of the funds they spent for someone to tell them that is the way social media is to be done. No wonder there are so many CEO’s and CFO’s I run into who have a bitter taste left in their mouth about using social media.
So the question I ask to turn people around in their thinking of using the social spaces for business becomes..What do you want to get out of social media?
Naturally, the answer usually includes statements like..get my money back or make a trillion dollars. In some people’s minds these are actually goals, but for the most part are very unrealistic aspirations.
The realist in business will answer with a statement like..I want to maintain a competitive advantage and develop a solid customer service vehicle from social media. The business person who sees these values is the business person who will gain a return on the time and effort being social in the social spaces.
If you are out to promote your business in the social spaces it can only be done through a social approach. Naturally, having a dedicated representative online to be the voice of the company is the most effective method. There are similar approaches that are just as effective.
The bottomline is…to get any return on funds spent on implementing social media there has to be a high level of socializing performed. Reaching out to strangers online and exchanging pleasantries is the simplest way to gain their trust. Once trust is built then everything else falls into place.
Depending on what you want to get out of social media will determine the approach to developing an effective use of social media. Just make sure you are placing social media first and not the ROI.
Let me know how I can help.