The Social Business Metrics Resource Round-up: Insights on social media measurements and ROI from around the web
The promise of social media is compelling. But how do you know that what you’re doing is working? Normally this isn’t such a difficult exercise. But when it comes to social media, measurement takes on a new level of complexity in many people’s minds. In fact, it can be one of the real limiting factors for companies in their evolution to becoming social enterprises.
Fortunately, the reality is that determining real, tangible metrics for your social activity is entirely possible. You just need to measure the right things. In this round-up, we’ll cover a number of smart thinkers who are demystifying the process.
Social business metrics themes: As we reviewed the material, a few themes emerged
- Social works? Prove it While there is plenty of anecdotal evidence to show the benefits that social tools deliver to today’s companies, business executives want to see tangible evidence.
- “Free” isn’t free There’s often the perception that social means free. It doesn’t. It certainly means cost-effective but there are other costs (such as time) that must be added into the equation when you’re measuring ROI.
- Measure what matters to the business Too much measurement is self-referential – it focuses on measuring the things that matter to social media. Back in the real world, it’s vital to measure the outcomes that matter to the business.
Social business metrics resources
The social media ROI pyramid
This is an excellent framework by Jeremiah Owyang focused on getting social media measurement right. Jeremiah spells out why you need to measure and, importantly, the right kinds of measurement for stakeholders at different levels. So while community managers may be focused on clicks, fans and retweets, business executives only care about an increase in the top line, a boost in reputation and reduced costs. Highly recommended.
The social media scorecard
Russell Pearson over at the Parallax View blog has a post subtitled “ROI made easy”.
In it he lists potential social business metrics for a range of company objectives – employee engagement, innovation, customer experience, sales etc. It’s a great place to start in determining what you can (and should) measure across your social business activities.
How to calculate the ROI of enterprise 2.0
For the more visually inclined, this infographic on the Socialcast blog lays out three core areas for you to focus your measurement around: increased employee engagement, decreased turnover rate and sales. We particularly like the instructions for measuring the ROI of a collaborative sales team.
"According to a recent article in Harvard Business Review titled “Competing on Talent Analytics,” companies like Starbucks, Limited Brands, and Best Buy not only greatly value employee engagement as a concept, but also can also accurately quantify an increase in employee engagement in actual dollars. For example, at Best Buy, a 0.1% increase in employee engagement at the store level is worth a $100,000 increase in annual operating income per store2."
The rise of the networked enterprise: Web 2.0 finds its payday
This research from McKinsey focuses on the tangible business benefits connected enterprises are already achieving. Importantly, they show how different types of networked companies realise different benefits.
"Our data show that fully networked enterprises are not only more likely to be market leaders or to be gaining market share but also use management practices that lead to margins higher than those of companies using the Web in more limited ways"
11 ways to measure the value of social media
In this article on Econsultancy, Jake Hird talks about the importance of approaching social business in a staged fashion: listening – interacting – selling. He then goes on to outline different available metrics, from interaction and traffic through to retention and profits.
"Most surveys of practicing social marketers have aligned its value with brand building, thought leadership, customer service and other important, but difficult to measure, ‘soft’ benefits. When the question posed is 'What is social media good for?', direct sales usually ranks toward the bottom. However, this ignores the increasing degree to which social media enables customers themselves as a channel for sales, PR and customer service"
Are you making these 5 social measurement mistakes?
In this post from internet marketing company, Outspoken Media, Lisa Barone highlights five key errors companies make in assessing the business impact of social media. It’s skewed, as you’d expect, towards marketing but three stand out for social businesses as a whole:
- Not assigning dollar values to social media KPIs
- Measuring ego, not results
- Ignoring the search factor
ROI of social media
In this video from our Dreamforce event, Jason Falls of Social Media Explorer focuses on the key benefits social media offers businesses today. He outlines the seven business drivers of social media and how to measure their success.
Also worth a look:
- Infographic: the ROI of social media A very cool chart from MDG Advertising.
- Return on influence: the new ROI From a Harvard Business Review blog post
- Shattering the myths about enterprise 2.0 Another excellent post on the HBR site
Don’t forget these Social Sales resources from Salesforce.com:
- The Social Success Portal Harnessing the power of social media for your business
- The Social-Powered Enterprise eBook Free 25 page eBook on how Social Media is transforming your 3 most important disciplines.