Social ROI (Part I)
By Joe Szalkiewicz
The Marketing Executive -- we’ll call her Jennifer -- steps up to the podium. It’s time to wow the board with her quarterly report, and the jewel of the report is the social media section. “Audience growth is up 70%, engagement is up 242%, and organic reach last month alone was over a quarter of a million people.” These are metrics-driven, quantifiable results, the kind of stuff board executives have been asking Jennifer to provide for years. She notices lots of nods and smiles from the members as she shares the results.
Then the Chairman throws the big wet blanket: “These results sound great, Jennifer, but what’s our ROI?” Jennifer’s demeanor drops. “The ROI is all the results I just listed. It’s the people interacting with our brand. It’s the new people who joined our community; the fact that our brand awareness is increasing through organic reach that we aren’t paying for. It’s awareness and affinity for our brand just like marketing has always been you idiot!”
This is, of course, what Jennifer thinks. What she says is: “I apologize, I don’t have a deeper ROI analysis prepared at this time. I’ll develop a more detailed report that more directly connects our results to the bottom line, ma’am.” Feeling dejected and now unsure of the value of all her social success, Jennifer struggles with what the heck just happened. She felt so confident, finally presenting the kind of information the board wants: numbers, analytics, quantified results. If those don’t do the trick, how in the world does she communicate the value of the success she readily recognizes in her gut as “knocking it out of the park”? Jennifer went into her board meeting feeling like a champion and left feeling dejected. She isn’t even sure where to begin.
This scene is playing out in board rooms every day. Social media and digital advertising in general has provided what marketing execs have longed for since the dawn of advertising: ample amounts of detailed data. Gone are the days where marketers live by adages like “50% of my marketing is working great -- I just don’t know which 50%.” We can now know almost down to the social security number who’s responding to our campaigns and whether the response is positive or negative. Digital Natives in particular are so free with their information, we can know the exact time and place of their first interaction with our brand, and what they thought about it. So why are CMO’s and CCO’s still struggling to impress their board members and others? There are many reasons, but let’s focus on what I believe is the biggest problem: something I call ‘Lacking the ROI Bullet.’
Jennifer is giving good and valuable data to her board. She just hasn’t connected the data to things the board cares about. This feels like a very difficult job, and it is actually made harder by the glut of analytics reporting options out there. Having so many options on what you can report on in terms of data sets makes it difficult to chose what to report.
The answer turns out to be far simpler than the rats’ nest of analytics tools would lead you to believe. It comes down to three very simple questions. Who does your board want you to reach? Why do they want you to reach them (as opposed to some other demographic)? And finally, what do they want them (the demographic they want you to reach) to do?
This is part one of a 2-part series; Part Two is available here.