Proven ROI or Not, 72 Percent of Companies Have a Social Media Strategy
September 15, 2010 By Heather Fletcher
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As much as companies tell their marketing departments they have to show a positive return on investment to justify spending on a new channel, most are still adding dollars to their social media strategies while only 29 percent of firms are requiring proof of ROI for continued funding. For that matter, ROI isn't being measured in the usual way.
So finds Salem, Mass.-based custom media provider King Fish Media in its survey, "Social Media Usage, Attitudes and Measurability: What Do Marketers Think?" HubSpot and Junta42 co-sponsored the research released in August.
Gordon Plutsky, director of marketing and research at King Fish, says the survey proves what his company has been saying all along: "Content is the key to creating an emotional connection. Social media has clearly emerged as a dynamic vehicle for delivering it to the right people in their preferred format."
Companies are using Facebook, LinkedIn and Twitter—with more and more adding videos on YouTube—to develop an audience for that content. Their objectives, according to the study, are to develop a dialogue with consumers in order to generate leads and develop closer relationships with their customers and prospects.
Plutsky explains more about how marketers are using social media:
Target Marketing: So 85 percent of respondents say original content is the most important contributor to a successful social media campaign. What kind of content is it? (Promotional? CRM? etc.) And what do they mean by success?
Gordon Plutsky: Our study showed that expert, original and branded content that delivers valuable information about an issue, product or industry works best in a social media campaign. It's important that the customer perceives value from the content—purely promotional content or puff pieces will not work over the long term. Metrics for success include identifying new customers and prospects, strengthening relationships with customers, increased sales of existing products and improved customer feedback.
TM: Of the marketers who do measure the ROI of their social media campaigns, what are they measuring?
GP: Often-used metrics are the number of fans or followers, traffic generated from the campaign, number of page views, SEO rank, number of leads generated, customer conversions and the number of comments posted.
TM: How were the marketers surveyed achieving conversions through social media campaigns?
GP: Though this was not directly asked in the survey, our experience shows us that online retailers and others in transactional businesses achieve conversion by sending potential customers to commerce pages with relevant content and offers. Other types of businesses (those not looking to make a direct sale online) hope to capture and nurture leads with an opt-in database.
TM: According to the research, "Only 9 percent of surveyed organizations have full-time positions dedicated to managing social media responsibilities, while 90 percent include those as part of someone's overall responsibilities." Of the companies with dedicated staff for social media efforts, whose duties weren't split, were the social media campaigns more successful than others?
GP: This was not directly asked in the survey, but my feeling is that larger Fortune 1000-type companies are now making social media positions dedicated posts. We will likely see more of this in the near future as companies like Pepsi, Honda and IBM replace some of their traditional marketing with ramped-up social media efforts. My sense is that companies with dedicated and talented teams will see better results than those without them.
TM: What's the main question marketers are asking about social media?
GP: This was not directly asked in the survey. But in my opinion it's, 'How do we monetize this?' We are all looking for the way(s) to convert social media engagement and conversations into new customers and into additional sales from existing customers. Many companies now have Twitter handles and Facebook fan pages, but the challenge is to turn all of this social activity into sales.
So finds Salem, Mass.-based custom media provider King Fish Media in its survey, "Social Media Usage, Attitudes and Measurability: What Do Marketers Think?" HubSpot and Junta42 co-sponsored the research released in August.
Gordon Plutsky, director of marketing and research at King Fish, says the survey proves what his company has been saying all along: "Content is the key to creating an emotional connection. Social media has clearly emerged as a dynamic vehicle for delivering it to the right people in their preferred format."
Companies are using Facebook, LinkedIn and Twitter—with more and more adding videos on YouTube—to develop an audience for that content. Their objectives, according to the study, are to develop a dialogue with consumers in order to generate leads and develop closer relationships with their customers and prospects.
Plutsky explains more about how marketers are using social media:
Target Marketing: So 85 percent of respondents say original content is the most important contributor to a successful social media campaign. What kind of content is it? (Promotional? CRM? etc.) And what do they mean by success?
Gordon Plutsky: Our study showed that expert, original and branded content that delivers valuable information about an issue, product or industry works best in a social media campaign. It's important that the customer perceives value from the content—purely promotional content or puff pieces will not work over the long term. Metrics for success include identifying new customers and prospects, strengthening relationships with customers, increased sales of existing products and improved customer feedback.
TM: Of the marketers who do measure the ROI of their social media campaigns, what are they measuring?
GP: Often-used metrics are the number of fans or followers, traffic generated from the campaign, number of page views, SEO rank, number of leads generated, customer conversions and the number of comments posted.
TM: How were the marketers surveyed achieving conversions through social media campaigns?
GP: Though this was not directly asked in the survey, our experience shows us that online retailers and others in transactional businesses achieve conversion by sending potential customers to commerce pages with relevant content and offers. Other types of businesses (those not looking to make a direct sale online) hope to capture and nurture leads with an opt-in database.
TM: According to the research, "Only 9 percent of surveyed organizations have full-time positions dedicated to managing social media responsibilities, while 90 percent include those as part of someone's overall responsibilities." Of the companies with dedicated staff for social media efforts, whose duties weren't split, were the social media campaigns more successful than others?
GP: This was not directly asked in the survey, but my feeling is that larger Fortune 1000-type companies are now making social media positions dedicated posts. We will likely see more of this in the near future as companies like Pepsi, Honda and IBM replace some of their traditional marketing with ramped-up social media efforts. My sense is that companies with dedicated and talented teams will see better results than those without them.
TM: What's the main question marketers are asking about social media?
GP: This was not directly asked in the survey. But in my opinion it's, 'How do we monetize this?' We are all looking for the way(s) to convert social media engagement and conversations into new customers and into additional sales from existing customers. Many companies now have Twitter handles and Facebook fan pages, but the challenge is to turn all of this social activity into sales.
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