Where’s the ROI for social media?
Through a special arrangement, presented here for discussion is a summary of a current article from Tenser’s Tirades blog and the Shopper Technology Institute.
An Instant Poll that recently appeared on the home page of CPGmatters.com sheds some light on an important part of social media evaluation; namely, ROI.
Every CPG company of consequence has a social media strategy nowadays. So do marketers think social media is a success?
Not really, say nearly nine of ten executives who took part in the poll. Only 12 percent say that social media is a success in CPG. Three of four respondents say concern over ROI is holding back success:
- There is not enough ROI so far to be a success (19 percent);
- It is very difficult to measure ROI at this time (56 percent);
- It’s too early to determine the success of social media in CPG (12 percent).
I concur especially with the largest group of poll respondents (56 percent) who say ROI measurement is the top present challenge for social media marketing programs. Know-how and methodology are simply lacking.
Others may be confusing counting likes and re-tweets with something that can be a reliable proxy for conversions. Sentiment analysis goes to brand reputation, not necessarily to resultant sales. And of course, heavy posters are outliers, heavily involved with the product for a variety of reasons.
Brands make a large commitment to monitor social media content and respond diligently. They may have little choice since silence is poison in this context. Still, fine control is unlikely since many opinions are set before they are posted, and defending too vigorously may appear like consciousness of guilt.
It’s a new era with new consumer expectations, and transparency seems to be highly valued. Brands that try to use social media to mount campaigns to drive measurable sales are likely to be disappointed. It’s too difficult to sort out the influences on any given conversion.
On balance, social media must be regarded today as a marketing and branding cost, not a driver of sales. That’s OK, I think, since marketing costs have long been justifiable based on their ability to generate awareness, communicate brand values, and build brand health. The days when an ad or promotion campaign could be reliably linked to a sales bump may be over. But that’s true more or less in all media, so it’s no disgrace that very new channels like social and mobile are hard to sort out. Better methods will come, and pretty quick, I’ll bet.
- Where’s the ROI for social media? – Tenser’s Tirades
- Where’s the ROI for social media? – Shopper Technology Institute
How tough is ROI determination for social media? What promising approaches are there? Can conversions be reliably linked to social media promotions?