Tag Archives: ROI
Even though Super Bowls can be a bit of a let down, advertisers and brands swarm to get spots for the big game. Case in point, all of the Super Bowl ad spots were sold out before Thanksgiving this year. This is mainly due to brands wanting to get in front of one of the largest audiences to view television programs. It is predicted this year there will have been 100 million people watching (REUTERS) the Super Bowl; and at a price tag of $3.5 million dollars for a 30 second spot, it may seem like a deal. However, I’m not sure that the brands truly recognize the value of the spots or the return they may, or may not get from them.
The Retail Advertising and Marketing Association states that 73% of consumers who watch the Super Bowl ads, watch them for entertainment; entertainment, not for purchase. Only 8.4% of all consumers who watch the ads, say the ads influence their intent to purchase. Now that number is quite scary. Brands invest $3.5 million dollars for 15-30 seconds of the consumers’ attention and only 8.4% see that spot and think, “purchase.” I won’t even go into my concern that the brands aren’t even doing their market research on the audience. How many brands that advertise during the Super Bowl know they are advertising to their target demographic?
We had a great turnout here at Critical Mass for our Social Media Week presentation on measuring Social Media ROI. As the standing room only crowd attested, this is a topic that many people are grappling with right now.
Social Media Week’s blogger Kerry Sugrue developed a good summary of the presentation, and we’ve made the slides available as well.
ROI Is Not Always the Right Fit
Perhaps the most well-received point of our presentation was the observation that the measurement of ROI is not always the best way to evaluate the value of social media engagement to an organization.
ROI has a clear definition; the measure of financial results against a defined investment. It is also unfortunately a management catch phrase.
Often, when management asks for the ROI on social media, what they are really asking for is the value of social media engagement to the business. Some value can be measured financially, and thus be converted to ROI, but with social media, much value must be measured in other terms.
Anyone who is asked to evaluate the ROI of their social media effort should ask back in return if ROI is really the right measure, or if management is really seeking the most relevant measures of value available. If the true interest is around understanding the effectiveness of engagement, then many alternative measures can be used.
Two prior posts on this blog have discussed digital experience optimization and methods for appropriately attributing across distributed digital touch-points. Among these touch-points, social media is becoming a significant focus for many businesses, so this post examines how measurement of social media should align with the digital experience delivery process.
Social Media ROI
The previous post in this series addressed how appropriate attribution is essential for establishing accurate ROI for communication though various channels. I’ll pick up again on ROI with this post since this is a strong area of general interest right now. (In fact, I presented on this last week, and have another presentation on the topic this week as part of Social Media Week).
A fact of ROI is that while the formula is simple, the variables can get complicated when multiple investments contribute to a single measured return (i.e. social media’s role in the attribution question) or when a single investment contributes to multiple measured outcomes (potentially as in the social media diagram above), or when the outcomes of an investment are difficult to quantify (as in most “returns” from social media). Unfortunately, any of these can come to bear in measuring social media ROI.
Social Media Outcomes
Since the amount invested in a social media program is usually front-of-mind to management, an important area for clarity is usually the definition of (quantifiable) outcomes. The diagram above aligns key measureable social media outcomes with stages in the digital experience delivery process.
A prior post on this blog discussed the digital experience delivery process with a focus on the practice of optimization. This post focuses on the steps that lead from awareness through to Action/Conversion, with an emphasis on the importance of properly understanding the drivers of digital conversions.
The Awareness Challenge
Most businesses understand that the notion “if you build it they will come” is not actually true when it comes to the web. The web is a big place with many options for consumers, so getting attention for the experience you’re offering is a critical component of the digital experience delivery process.
The job of generating awareness and thus (relevant) traffic to your website typically belongs to online advertising and SEO teams, who utilize search engines for organic and paid appearances and distribute display ads across the web. Increasingly, social media is also being utilized as a channel for driving traffic to websites.
In the ideal process, your awareness generation efforts bring people into a destination designed and optimized to meet their needs, and their visit ultimately results in a mutually beneficial transaction.
Trying to increase your Facebook fans, Twitter following or even charitable donation numbers? Give something away.
Brands make a habit of promising that if YOU follow or like they’ll give things away to a varying number of followers. Life as a Community Moderator has by no means made me immune to this. In the past year, I’ve become a fan of Einstein Bagels—even though I don’t eat bread. I’ve voted on my favorite feature of a Ford Explorer and “liked” the page—even though I have no use for a car in the city, and I’ve followed Chicago Food Critic Steve Dolinsky for the chance to go to dinner with him (and won)—even though (I’m sorry, Steve) I had no idea who he was. Why? Because these brands were all giving stuff away and even though I didn’t necessarily need this stuff, I did what these brands and people asked for a chance to win. Was I bought or was I earned? Short answer: I was bought in all cases except for Steve Dolinksy, he’s great. I don’t fit the other brands’ profiles of a model community member, and I’m a useless fan.
Upon realizing my own affinity to follow the directions of those who will buy or give me things, I started to think through successful contests and giveaways for branded communities. Thus, my proposal for a SXSWi panel, Fans for Freebies, was born.
Aside from my own anecdotal evidence in Einstein Bros Bagels’ giveaway, the brand posted some solid fan numbers after it gave away coupons for free bagels to all who liked its page. In an interview with Spinsucks.com, the brand revealed that it increased its fan numbers from 4,700 to 613,703. Suspecting that many would have dropped off as fans after downloading their coupons, I checked the Facebook fan page’s current fan count: 613,413. That’s a 310 fan loss, out of 609,003 fans gained through the giveaway, that’s over a 99% retention rate. In college, we called that an A+. Because Einstein featured more deals and giveaways since their initial free-bagel offering, my conclusion is that these fans actually frequent Einstein Bagels enough to make use of the page’s coupons, thus they are valuable and active fans. Aside from those who gave their coupons away (me), these fans were earned.
Originally published at iMedia Connection.
The doldrums of summer notwithstanding, I’ve noticed no dearth of self-reflective articles discussing the changing role of the advertising/marketing agency in a web 2.0 world.
Great minds wax poetic about the move from push to pull, from TV to web, from monologue to dialogue – and these are great discussion topics.
But you know what? Almost none of these articles talk about sales.
Are we forgetting our purpose?
Bursting A Bubble
I remember back when the internet was the shiny new object of fascination. Over time, businesses that marketed online to sell products survived (i.e. Amazon.com) and those that just focused on the fun online marketing stuff…well, didn’t (i.e. Pets.com).
Are we seeing a similar trend with social media? A lot of brands are throwing money at engagement and conversation and friending – but is this making the cash register ring?
Image Courtsey of Big Mouth Media; http://tinyurl.com/nellt9
Real Marketers Still Make – And Sell – Stuff
Phil Johnson’s Ad Age piece entitled Agencies Should Be Defined by What They Know, Not What They Make is one of the articles about the modern agency that rubbed me wrong.
As I read it, his article focuses on what we know (communication) at the expense of what we make (ads/experiences which turn into sales).
My conviction is that advertising agencies should become a community full of intellectually curious people…Clients should feel compelled to work with a given agency because they hold the keys to the mysteries of how people communicate with each other.
OK, sure, but isn’t this a tad esoteric?
Clients aren’t comforted by what you know. They’d rather see how you turn that into sales.
Agencies that use social media, then foster loyalty and trust, and then turn that into sales – those agencies will triumph. But agencies that dabble in social media without even considering ROI or sales…think Pets.com 2.0.
Marketers and advertisers who consider sales not lofty enough of a goal would do well to remember David Ogilvy’s number one obiter dictum from Confessions of an Advertising Man:
“We sell – or else.”
