Align measurement with business aims for social media
Wed, 4 Jun 2014 | By DeeDee Doke
To effectively measure an organisation’s return on investment (ROI) in social media, measurements must be aligned with its business aims, a London audience heard last night [3 June].
Companies use platforms such as Facebook and Twitter to support functions as diverse as recruitment, customer service, product development and quality control, which means that how the ROI is measured must match how social media is being used, attendees at a First Tuesday technology gathering were told.
Do the number of clicks, likes or follows really translate into any financial impact?, was the rhetorical question asked. Yes, said speaker Christer Holloman, but ultimately, unlocking the ROI of social media is to link the measurements to a company’s key performance indicators (KPIs) and “have a goal the whole business understands”. Holloman is a social media and technology specialist, who has just launched a new book, The Social Media MBA Guide to ROI.
His advice is particularly appropriate for organisations when they are hiring, not only to find the most effective methods but also the best channels.
For instance, customers of workplace social media platform Glassdoor UK measure their ROI by computing their cost per hire, Holloman said. The customers might pay a fixed fee to advertise on Glassdoor and secure a certain number of hires for that amount, while they might have to pay individual fees for hires made through recruitment agencies. [Holloman provides UK business development for Glassdoor.]
At multinational electronics and music corporation Sony, social media is used to ‘listen’ to consumer conversations and comments to identify any problems with new products. As a result, Sony is able to pinpoint and fix any critical issues much more quickly than if the company waited for months to learn about problems through more formal channels. By using social media as a quality control measure, Sony is able to save money and stay closer to its customers, Holloman said.
In the US, financial services giant Barclays has used social media to develop what it claims is the world’s first social media credit card, Holloman said. The bank has been able to prove that by involving customers via social media to create their guidelines and rules for the card’s use, such as preferred interest rate, the number of customers defaulting on their credit bills has been reduced.
To ensure the most effective measurement, Holloman urged the audience to define success, set realistic goals, track information and analyse the data.
Other speakers were Eb Adeyeri, strategy director for social media marketing and social business programme agency We Are Social, and Kristian Lorenzon, head of social media, 02 Telefonica UK.
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