Social media is about the hottest topic there is right now in the online marketing world. Search marketers and traditional marketers are both obsessed with finding ways to drive interest and traffic using this new medium. But how many of them are actually investing in social media marketing and how many are simply offering up half hearted efforts? Drew McLellan posts today to ask if social media marketing is still more hype than reality.

Drew points to a new survey from Coremetrics that shows a mismatch between supposed interest levels and marketing investment. The survey reveals 78% of marketers feel social media marketing will give them a leg up on their competitors. But Drew writes:

They talk a good game, but they're not really putting their money where their mouth is. Just 7.7 percent of their total online marketing spend was allocated to it compared to 33 percent to online advertising and 28 percent on online promotion design and implementation.

The biggest issue seems to be lack of metrics. For some, that means lack of time to measure, for others it means lack of knowledge of WHAT to measure.

Drew's post ties in well with the discussion meme Mack Collier tagged me in this week. His post traces back to an excellent one Geoff Livingston made on The Buzz Bin.

Livington explains the reluctance of so many mainstream marketers to dive into social media by citing the push for conversation over conversion.

Geoff writes:

...there is still a very large contingent of social media types that tout conversation instead of measurement. Quite frankly, asking companies to invest tens of thousands to millions of dollars on a conversation -- while factually accurate -- flies in the face of reality. Instead of convincing them, this conversational chatter only scares companies away.

Until we can demonstrate consistent results, organizations will resist social media adoption.

He goes on to talk about how Dell has tracked negative blog posts since the infamous "Dell Hell" incident (at 49%) to the present (22%). While this is clearly a measurable (though not a direct conversion style ROI) metric, it's still hard to put a price tag on things. That leaves social media marketing as the new media version of public relations. You can track the conversation, you can track the "pick-ups," but it's awfully hard to track the direct impact on your bottom line.

I see his point. In fact, it's no secret that I feel many in the SEO world are incredibly misguided in their social media efforts. I can't count the number of times I've heard search marketers tout social media for the number of links or site visits it can drive. That's fine and dandy, but it fails to address the need to actually GAIN something tangible from a campaign.

So what do I think about social media measurement?

From my point of view as a small business social media advocate, there are two points missing from the conversation.

First, there's the idea that social media has such high costs associated with it. While it's true that a large company might pour tens or even hundreds of thousands of dollars into a MySpace page, production of YouTube videos or the integration of Web 2.0 technologies, small businesses tend to come at things from a completely different angle. For the most part, the small business owner measures the cost of a social media campaign in time, not in dollars.

YouTube videos can be shot with the digital camera you already own. Accounts on Facebook, Digg, MySpace, LinkedIn and other social media networking sites are free. Free blogging programs abound. For the small business owner, social media is generally about personal involvement rather than the investment of funds into creative and programming. You ARE your social media presence. You aren't hiring a firm to create one for you.

This leaves small business owners with far less need to directly measure the response to their campaigns. After all, it's always easier to justify a budget of zero.

That said, there's no arguing that time is money to the small business owner. After all, every hour spent blogging or cruising around Facebook is an hour not being spent on clients. So while costs are generally low, there is still a need to track results to make sure your time and effort is well spent.

That leads to my second point...the need to look to things beyond simple conversion rates for measurement. One of the great things about the web is the ability to track direct conversions. The data available these days are what marketers dreamed of decades ago. The ability to track a sale back to a search query, a blog post, a social media site or even a bookmark gives marketers unprecedented insight into what triggers the buyer's impulse in their target audience. It's powerful, powerful data.

On the down side, we've now become spoiled with our ability to track things. We've gotten comfortable with our metrics and we've lost the marketer's insight that allowed us to see beyond those direct conversions. This happens to us in the search world all the time. We take joy in the ability to track a conversion back to the exact search term that brought the visitor to our site, all while pushing back the knowledge that your average shopper conducts 6-8 searches before making a purchase and that 68% of shoppers will make their purchase offline. Sure, we know what phrase ultimately sends them to make the purchase, but what about all those search visits we write off for lack of conversion. Are we sure they aren't responsible for driving repeat visits and purchases down the road?

The same can be said for social media marketing. I see this new drive for metrics and note that many of the pushers are insisting we must track the direct impact of social media marketing on sales. This push ignores the idea that social media marketing builds brand, builds trust and often serves as an influencer rather than a directly trackable source. How many sales are being credited to things like bookmarks, email marketing efforts and blog posts when the reality is that social media is responsible for that bookmark, that email subscription and that editorial link on the blog?

Beyond that, I'm glad to see some talk of measurement outside of pure sales. Geoff talks about tracking the increase in positive comments about Dell and Mack talks about increasing the number of customer evangelists by blogging. I've always encouraged small business owners to look beyond sales to find the metrics they wish to measure. In fact, I wrote a two-part series for ClickTracks on how to use visitor segmentation to find value beyond pure sales.

To offer up an example, I'll refer to The Lactivist, my hobby blog. While I do sell products via CafePress, I'd be doing a disservice to my blog if my sole metric was sales. The site is primarily content driven. The blog is the central focus of the site. Earlier this year, I began selling advertising on the site. That meant each and every visitor suddenly had a dollar value whether they made a purchase or not. In fact, when I sat down and did the math to figure out my average CPM earnings for my ads over the last few months, I can see I earn a little more than a penny per visitor.

With that knowledge, I now track a variety of things.

  • Number of visitors referred from social media efforts (each visitor = one penny profit)


  • Number of links generated by social media efforts (links create more visitors, visitors = profits)

  • Which links send which types of visitors (understanding what types of sites send which visitor segments is invaluable to future link building efforts)

  • Number of comments in response to my posts (comments = engagement, engagement = return visitors, visitors = profit)

  • Which links send buyers (buyers = specific $ profits)

  • Which links send shoppers (the majority of my buyers come from links posted by those who viewed my products)

Of course those are only a handful of the ways I value my social media traffic.

I'd venture a guess that any small business who values their social media traffic solely by looking at how many buyers or leads it produces is being short sighted. The online buying cycle is a complex process. People don't wake up one day, decide they want a widget, take a direct route to get to it and make an immediate purchase. Tracking our social media metrics as if they do leaves far too much value sitting out in the cold waiting to be noticed.

So how do you track your social media success? What metrics do you look at? More importantly, how do we help businesses both large and small understand how to value the success of social media efforts? I'd love to hear from everyone in the comments, but I'm going to specifically call out Wendy Piersall, Matt Bailey, Stoney deGeyter and Matt McGee.


November 19, 2007





Jennifer Laycock is the Editor of Search Engine Guide, the Social Media Faculty Chair for MarketMotive and offers small business social media strategy & consulting. Jennifer enjoys the challenge of finding unique and creative ways to connect with consumers without spending a fortune in marketing dollars. Though she now prefers to work with small businesses, Jennifer’s clients have included companies like Verizon, American Greetings and Highlights for Children.





Comments(8)

Fantastic post, deep thoughts, laden with experience and insights. I'll be sure to mention your comments in the wrap up post.

Social Media... just another form of marketing.

As any marketer will know that sales usually take several occasions of contact before the sale will take place. Social media is vital in keeping that contact going.

I have to point out that although web 2.0 as we know it now is relatively new, the concept of keeping in touch, communities... etc. is not. Those that have managed to keep these small avenues of communication open have managed to keep visitors returning to their sites, sometimes after years since the last contact. The worth of that? Priceless!

"Number of comments in response to my posts (comments = engagement, engagement = return visitors, visitors = profit)"

If companies are wanting to use metrics for blogging, I think this is where they need to start, in tracking comments and links to posts. More comments and links are great signs that a blog is producing content that readers are finding value in.

If the readers find the content valuable, they will leave comments, but they will also share it with others. Which as we both know will result in more visitors, a higher PageRank, likely more positive web mentions for the company, and will help establish the company as a leader in its industry.

But I think it all starts with providing value for readers. THAT should be a company's main blogging goal. Great post, as always Jen!

"This push ignores the idea that social media marketing builds brand, builds trust and often serves as an influencer rather than a directly trackable source."

In my opinion that's the main push here. The conversation is a component of the brand, the more you get the stronger it becomes the more likely you'll get your conversions.

I mean, what's the point of any of this stuff on the personal level? What does a personal blog, Flickr stream, or Facebook page do besides push personal brand and pull in connections based on that? Being popular and influential is good. (or so I've been told...)

-M

Jennifer, really nice post - there’s not enough discussion about the “Value of Social Media” from a marketing perspective.

Robert’s hit the nail on the head that it’s “just another form of marketing” and to understand the value it’s necessary to think through firstly how effectively it can be used in terms of lead generation and secondly how increasing the advocacy of those most influential in a marketplace can shorten sales cycles by addressing sales objections.

Today’s context in which we operate is one where:

1. There are so many marketing messages that more and more people (target customers) tune out, making it ever more difficult to get through to them and this applies regardless of whether it’s advertising; direct mail…

2. Even if your message does get through, then it’s highly likely to be perceived as very much the same as your competitors – getting your differentiators through is really really hard!

3. In the small percentage of cases where your message does get through and is understood to be somewhat different or even compelling your targets are less likely to believe you than ever before, they’re sceptical of what you say and inclined not to believe you because “you would say that wouldn’t you – you’re trying to sell me something”.

Social Media provides an excellent way for people to seek advice and guidance from a broad set of people they trust and respect, some they know personally others they don’t.

So, to maximise the value of Social Media as a marketing vehicle it’s key to understand who are the key influencers in your marketplace and then work at increasing their level of advocacy towards you. Easier said than done! A scatter-gun approach will be hit and miss! Research who they are; rank them; then reach and leverage them through marketing to them. Many will not be potential customers and using your sales pitch will just make them run away and hide… Market through and with them adding value to their agendas…

And one last rant on Brand… Brand is a consequence of success not a prerequisite for it. Google is successful, so its brand becomes trusted. Brand is a measure of trust and expectation, not awareness! I think there’s far too much emphasis on brand, in B2B in particular it should be a consequence of good sales and marketing and not the objective – it’s an outcome and focusing on it will not give any reasonable ROI.

P.S. I have strong views because this is what I do day-in day-out! www.influencer50.com www.influencermarketingbook.com

Cheers, Scott.

Scott:

"You don't become the best known brand because you are the oldest, but you become the oldest brand because you are the best"

I think that pretty much sums up branding.

Jen, a great read. Discovered your insight via Mack. Bang on...

Jen, really good post. I'm conflicted on this topic. Metrics are, of course, great. And you're right in that there's so much we can do. So I agree with that.

But the one who breaks through on this, the one that gains the big benefit from this, is the one that says, "I'm just going to start talking to my customers and empowering them to talk about me if they're interested. I'm going to do it and I'm going to measure it later. Because for $250,000 or so out of my $100,000,000 ad budget, I can do some pretty cool stuff. I'll measure it, but first I'll just do it."

That's the breakthrough person. That's the brand that accrues the big benefits from social media marketing. Sometimes you can caution yourself into irrelevance...

~Jim



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