There has been a lot of talk about measurement and return-on-investment in the world of social media. Where and what do we measure? Is there any type of return on investment we can micro manage down to the point of dollars and cents?
Richard Stacy asked a brilliant question on his Social Computing Journal post called Social Media Measurement – Are We STaring At Stones? Are we measuring/looking at the wrong thing? Are we missing the point when we use Web 1.0 measurement tools and try to squeeze them into a Web 2.0 – 3.0 world? I think so. I would guess that Richard would agree.
Are we staring at the finish line without starting the race?
We are focused so intently on understanding the measurement model of social media that we fail to recognize the tool itself. We fail to realize that a complete understanding of social media (as a tool) has yet to be accomplished. We need to back up and refocus. As a company, we are just as guilty.
It is hard for me to swallow the concepts of using traditional and web 1.0 measurements tools (traffic, click-throughs) to social media tools like Twitter. What is the answer? Ad agencies are falling over themselves to gain as many viewers as possible to online videos. We can have 2 million views on a YouTube video but does that measure to actual growth in sales? It is hard to tell and becoming increasingly harder (Google aquisition of YouTube).
I don’t have the answer. Every interactive marketing firm on the planet is trying to measure this phenomenal new medium of communication… We all have case studies but there hasn’t been a proven formula for measurement.
Maybe we need to go back to the basics… refocus on completely understanding a new medium that is changing our entire communication formula.
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Brett Atkin
Do you think the need to measure the ROI will take away the social nature of the medium? Will it change the tone of the converstaions? Will it just become a new form of advertising? If people know that, will it loose the “social” aspect that everyone wants?
I don’t have answers to any of this, but I try to view all forms of social media as a relationship building tool first and a $$ generating tool second. If we flip this, will social media become just another banner ad?
laurent
You’re damn right that this is all over the web (well at least on blogs talking about social media marketing) and nobody has the answer. Lots of people are saying can’t use the 1.0 metrics. Probably true but nobody can point to new ones. Some try but at least there isn’t a consensus. I remember a blogger who said: “i’m not a click, i’m not a keyword, i’m a person”. I think that tells a lot because in my view of work/life, measuring the benefit of people’s interaction is so hard. Try to put a $ number on friendship and it spoils it. Now the truth is that business need metrics because a good execs knows that what you can’t measure you can’t manage. Where I work we have a couple ideas. For exemple on measuring influence, we recommend to measure two things: How influent are 1) your content 2) your people. On content, mneasure the influence of a company blog within it’s community (i.e: if it was in computer security, how does your blog rank within the other 1000 blogs on computer security). On people, measure the level of connections they have with relevant influencers in the community.
Those are ideas, things we preach. But you’re very correct when you say that the models don’t exists thus measuring is difficult when you don’t know what to measure.
Kyle Lacy
@Brett That is a hard question to answer.. or maybe it is not. 🙂 I think that the advertising world will dumb down the social aspects of the medium but the true value of social media is that it is controlled by the consumer not the supplier. Facebook is a great example of this.. They do not control anything.. it is the 250 million that control the content.
@laurent What does a blog rank get you in terms of measurable financial results? That is what I am struggling with.
Maybe there is no way to measure social media – WinExtra
[…] Kyle Lacy put it this way this morning We are focused so intently on understanding the measurement model of social media that we fail to recognize the tool itself. We fail to realize that a complete understanding of social media (as a tool) has yet to be accomplished. We need to back up and refocus. As a company, we are just as guilty. […]
Stuart Foster
Like the idea of starting over from scratch. Dumbing down metrics to a 1.0 model is very difficult to qualify.
My best guess on how to proceed? Try and do it backwards after completing each sales cycle and seeing where SM had an impact.
laurent
kyle,
Obviously, it doesn’t translate into direct measurable financial impact. I think that’s the problem with trying to put a $ number in front of any relevant metrics for SM. Most of the impact will be indirect. Because SM is a great place for influence.
A while ago I found this pretty good resource:
http://twitpic.com/32nwn/full
Tell me how many of those metrics translate into $. Though most of them are valid SM ones.
IndyChristian
Kyle, admittedly the following is not geared to finances, but measurement IS important from my perspective. Its importance for me is to help maintain focus on the strategy (of deploying social media as a driver toward overall mission success).
What metric might be best? I wish I had a composite… QTY x QA. Qty of FBfriends (easy enough, heh?) But Quality is the tougher part… preferably ‘proximity to the mission’. That is, how aligned are their core values compared to the core values or mission I’m hoping they’ll help advocate for.
In a market world, call it narrow-casting… especially to your prime ADVOCATES.
IndyChristian
P.S… The low-hanging fruit I currently use re my QA (Quality) metric… is Facebook groups. Number of your friends who join a group is an indicator of how closely aligned they are to your mission.
Btw, one improvement might be to use a ReedsLaw type of formula to indicate the wider network potential of each group-member.
Douglas Karr
I honestly think your point is moot. Large companies demand measurement because it’s always been a successful means of driving productivity and profitability. You’re simply not going to walk into a Fortune 500 company, tell them to hire a social media team or invest in social media and say, “No, don’t worry about measurement – it works… trust me.”
I just got back from Webtrends Engage 2009 Conference in Las Vegas and session after session were successful examples of accurate measurement of social media on business. It is measurable – both in profitability, acquisition, and retention.
You CAN measure the impact – but it’s very difficult and not for the average joe. You can also optimize the data you capture to enhance communications with prospects and customers.
Measurement is essential because marketing teams don’t have the resources to manage 1:1 relationships when they have tens of thousands of customers. You have to know where you can make the most impact – or your company will flounder and fail.
Luckily, Social Media ENABLES online marketers to measure the impact where off-line models do not. You can’t improve what you can’t measure.
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