In the course of work, I often hear the refrain that ROI with regards to Social Media is hard to quantify and that we should be looking at engagement and conversation rather than material returns. Thats really nonsense. Sure, a greater degree of engagement with your stakeholders is a good thing, but this doesn’t automatically translate into increased revenue or profit which is the ultimate aim. In fact more often than not, familiarity breeds contempt.
So-called Social Media consultants who advise you to measure your ROI based on number of members, amount of feedback, etc… are either misguided or do not have your best interests at heart. A business is seldom run based on how much feedback they get. Its a useful thing to have, but its not likely to be a business driver. Furthermore, the ease at which unique personas can be created online, leads one to believe that with sufficient time and inclination, these numbers can be artificially manipulated.
Feedback is helpful in identifying operational shortfalls, but to use this as a measure of social media’s effectiveness is not what I would call a useful way to spend your company’s money. And more often than not, the public’s vision of how your product should evolve is highly unlikely to be as innovative or ground-breaking as we would hope. As Henry Ford, said “If I’d asked my customers what they wanted, they’d have said a faster horse.” That said, this kind of feedback is usually acceptable if its to tweak certain specs.
At the end of the day, if your company’s engagement within the social media space doesn’t lead to new business, repeat business or product development initiatives, then its maybe not the best place for you to be in. I usually measure its effectiveness by launching promotions or products before the media blitz and see how much upside I get. Thats quantifiable and easily measurable. It also helps me to determine which channels or platforms work best.
Sometimes, we also get feedback that allows us to streamline our processes better, but these are rare. More often than not, customers view the opening of another channel of communication as being just another (possibly more convenient) way to air their grievances.
For this reason, we don’t spend too much money on social media engagement to the chagrin of the many experts who believe that all big companies should pay them thousands of dollars to spout the rubbish they claim is their intellectual approach to social media. I do believe social media is a ground breaking channel of communication, but till I see a greater degree of real business derived from it, I am unlikely to pour more resources into it.
As a customer said to me recently “It ain’t the way you say, its what you have to say….you could drop an email to my janitor offering to sell your product at 50% discount and believe me, we would find out and react to it immediately…..or you could blast me from all angles with a great new product that don’t do nuthin for us, and we still couldn’t care less”……
Some Meowsings...... 