According to a survey of over 300 marketers across a variety of industries, nearly two-thirds (64 percent) believe social marketing is "more effective than traditional marketing." Yet, few think they can effectively measure the ROI of online social media (34 percent) or offline WOM (22 percent).
The end-result is that measurement problems are preventing greater usage of word of mouth marketing. The top three cited obstacles are difficulty in measuring offline WOM (89 percent), not being able to show ROI (85 percent), and difficulty measuring online social media (79 percent). Other obstacles are a lack of company coordination (75 percent) and lack of understanding about WOM marketing (64 percent).
The American Marketing Association (AMA) and the Word of Mouth Marketing Association (WOMMA) sponsored the first of its kind survey.
In an interview with Business 2 Community, David Smith, director of research & analytics at House Party, a social media marketing company, cited weak measurement tools as the reason only 43 percent of marketers listed "direct sales" as a major objective of their WOMM/social media campaigns. Coming in much higher were driving brand awareness (82 percent) and increasing engagement (69 percent). He added, "If marketers were better able to measure a sales impact, they'd feel more comfortable listing that as an objective."
Demonstrating the particular challenges around quantifying offline WOM ROI, organizing parties or events earned the highest level of satisfaction overall, with nine in 10 marketers saying they were "very" or "somewhat" satisfied using this tactic. Yet only 30 percent of all respondents surveyed utilized such events.
WOMMA plans to unveil a landmark study on ROI at its November summit.
Other findings from the survey:
Should offline or online WOM be receiving a larger share of the marketing budget?