Today’s installment is a collaboration between Johnson King’s Tom Kirkham, account manager, and Jonathan Mathias, senior account executive. Keep an eye out for more updates from our friends in the UK later this week!
Social Media Week: the ROI question – what do we actually want from social media?
Tom Kirkham, account manager, and Jonathan Mathias, senior account executive at Johnson King
Greetings from Social Media Week (http://socialmediaweek.org/), where yesterday evening we attended an absorbing debate at ‘Chinwag Live: Show me the money – where is the ROI in social media? (http://smw-london.sched.org/event/96a5ab8a98ad88 081ca46d7e08b46ff3) . Speaking for Johnson King, we definitely saw an immediate return on investment – attendance didn’t cost us a thing and there were drinks and pizza provided for all. However it became clear as the debate unfolded that the business world is still struggling to quantify ROI (see this recent IAB study for starters: http://www.nma.co. uk/news/brands-need-roi-evidence-to-invest-more-in-social-media-says-iab/3009466.article), and indeed, several of the panelists made a convincing case for redefining ROI altogether when assessing social media’s value.
The debate took a while to heat up; after the first fifteen minutes all they’d determined was that ‘listening is key’ – not exactly groundbreaking stuff. However, then the idea was raised that instead of analysing the people talking about your brand (and thus already engaged with you), you need to listen to the people who aren’t talking about you, and figure out a way to interact with them. The key is to tap into the conversations taking place within a wider context, thus creating a new audience for your business.
Another key point was that social media activity has different aims depending on whether it is being used to engage directly with consumers as a sales tool. In a B2C context, ROI from a social media campaign will likely manifest itself in sales figures which can be broken down and evaluated. However, in a B2B environment social media tactics are much more useful in terms of brand building and reputation or crisis management. Mark Rogers at Market Sentinel argued that social media monitoring is actually more valuable than measurement, as it can be used to assess campaigns in real-time to decide whether to keep going or pull the plug, whereas all measurement can do is provide a retrospective proof point – i.e. “It worked,” or, “It didn’t work”.
Robin Grant of We Are Social described social media investment as similar to life insurance: you’re making a payment that doesn’t have a return unless something goes wrong. The best examples of successful business-customer interaction using social media occur when traditional channels like telephone or email have become overburdened or ignored. Yet even then appraising a social media strategy may involve dealing with something very abstract – sentiment and perception – rather than ‘results’ in a more tangible sense. While many businesses still ignore customer criticism within Facebook groups, blog entries and Twitter posts, the panel lauded several forward-thinking companies that have taken a mature, honest approach to social media outreach to address these crises.
The big question is whether being seen to be listening and taking action is ROI enough? This is of course a world away from financial ROI, and the panel didn’t seem convinced that many CEOs would be willing to embrace this concept at present. That said, last night’s overarching take-away message was that social media is going to cause a seismic shift in the way consumers perceive businesses – with a far greater emphasis placed on trust and transparency– suggesting that perhaps these CEOs will be forced to re-evaluate their own definitions of ROI in the near future.