What is ROI ? Why ROI Matters?
The acronym stands for Return On Investment. In other words, how much of the investment (in terms of time, effort and money) gets converted into business-favourable activity (such as sales, brand recognition, partnerships etc etc)
Businesses calls for 3 channels of investment; By Thought, By Time, and By Money. Measuring the performance (of the idea) is a direct indicator of its probability of success (money) over a period of time.
By tracking the ROI on each item at the investment-sequence-chain, we are able to identify the ones that generate maximum interest amongst the audience (user engagement, as they say in social media), which acts as a soft-selling-tactic nudging the user to sign up with the businesses’ service/product offering.
Hence ROI matters
What gets tracked over for ROI?
Assuming the product / service in the offing is superlative; the Advertising and Marketing division shoulders the responsibility to drive sales and generate revenue. So it is only natural for the business owners to track the Return on the investment made to this department and compare it against the sale generated by Advertising and Marketing campaigns.
In other words, any effort to connect with the public at large over the business’s product / service/ brand qualifies to be tracked over for ROI
Traditional Media vs Social Media ROI
Marketing via Traditional media includes Benefit flyers, Radio ads, TV ads, Billboards etc. The brand message is thrust onto the consumer-at-large, with no specific target-customer in mind. Due to such generic nature of these “push-model” advts, measuring the ROI too is very non-specific. One can only measure the no. Of benefit flyers distributed, no. of times the ads being aired etc.. but cannot measure, if these efforts have created a direct customer engagement with the brand or not.
Social Media on the other hand is about targeted marketing and strategic sharing of customer-centric ads. This personalised approach makes social media ads to influence customer behaviour compared to traditional ads. Here, personalisation happens are multiple levels; Geography / location of the customer, Interests & Inclinations (from associated groups/community/ forums etc), and age. Armed with these data from the public social media stream of a customer, ads are strategically placed along the timeline to gain maximum attention and there by influence purchase pattern. Hence measuring Social Media ROI is very specific and extremely detailed.
Social Media Strategy – Chatter that matters
Call it Water cooler talk, huff it over a puff, talk it over a beer, are all but another name for offline – social – media – interaction. We tend to recall these unofficial chatter with better clarity than our boardroom meetings. If not for the meeting agenda, and the dutiful colleague who keeps the minutes of the meeting, many would be lost as to what to expect, and what to say next.
The ultimate goal of any social media interaction is to generate brand awareness, grow in popularity and in turn subtly drive sales to the business service/ product. The strategies listed here are popular, tried, tested and repetitive.
There is nothing wrong with being repetitive. This can only mean one thing. This actually works.
- Stuff matters, fluff don’t : Ensure the content you share is authentic, legally permissible and extremely relevant to the context.
- Content is King, Context is Monarch:. A short “May be this will help” on the right context is likely to have better impact than your 3 fold marketing brochure.
- Being social is about respecting other’s social space as well : Distribute your social media updates over the day / week. Flooding the timeline (even if it is your SM acct) with self-promo material is obscene.
Additional reading – Stage Manage Social Media; Postion yourself Strategically.
Social Media Metrics used towards measuring ROI
LogicSpeak : Measuring ROI from Social Media
Social Media engagement is a slow and steady process. This is not a magic pill to skyrocket your brand / product/service from out of the blue. One needs to allow at least 3-6 months for the efforts on Social Media to produce measurable metrics.
By diligently tracking the above Social ROI metrics and overlaying the results over the website/sales analytics data, one can determine the impact of Social Media ROI on the overall business.
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