measuring social return on investment

SOCIAL MEASUREMENTBEST PRACTICES FRAMEWORK

FOR A SOCIAL MEASUREMENT STRATEGY A practical, proven approach to integrating social media with other digital channels and determining its value to the bottom line.

DIGITALMEASUREMENT

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2013 © 2013 WEBTRENDS, INC. WWW.WEBTRENDS.COM.

CONVERSION OPTIMIZATION

SOCIAL MEASUREMENTBEST PRACTICES FRAMEWORK

FOR A SOCIAL MEASUREMENT STRATEGYA practical, proven approach to integrating social media with other digital channels and determining its value to the bottom line.

Mind the Social Gap

Altimeter Group reports that 48% of corporations made social media ROI a primary focus in 2011, yet just 56% of companies who identified as advanced users of social media had standard measurement frameworks in place to help benchmark ROI.

+20%rise in social media in the next 5 years

$1.2 BILLION SPENT ONSOCIAL MEDIA IN THE US IN 2011

Merlyn Gordon, Director, Solutions Marketing

Merlyn has spent his career helping leading global brands succeed with

digital marketing, social CRM, and multi-channel measurement solutions.

As Director of Solutions Marketing at Webtrends, Merlyn is currently

responsible for product marketing activities related to Webtrends’

portfolio of measurement and optimization solutions.

AUTHOR BIO

EXECUTIVE SUMMARY

TREND

As spending increases in social media, marketing departments are under greater pressure to prove the value of social channels and tie efforts to business outcomes and revenue.

PROBLEM

However, most companies who include social media in their digital marketing efforts do not have a measurement strategy in place to prove success or return on investment.

SOLUTION

By developing a framework grounded in best practices — objectives, technology and expertise — companies can clearly measure the impact of social on engagement, conversion and revenue, and in context of other digital marketing efforts.

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SOCIAL MEDIA AS A BUSINESS DRIVERIt’s fair to say that social media is no longer new – Facebook, Twitter and YouTube have been around for more than six years, and internal collaboration solutions, such as Jive and SharePoint, have been in use even longer. But the volatility, fragmentation and unique characteristics of social data continue to challenge many brands. Companies are still looking for ways to quantify the success of social media initiatives.

As social media ramps up and dollars shift from traditional marketing channels, there’s a corresponding shift in technology ownership taking place within many organizations. In fact, Gartner recently predicted that CMOs will surpass CIOs in technology spend by 2017. This adds to the pressure marketing leaders are feeling to justify investments in people and tools, and to tie social initiatives back to business performance. Proving social ROI is the primary challenge most organizations face as they adopt social business programs.

CHALLENGES OF MANAGING SOCIAL MEDIA MARKETING

In addition to the challenge of tying social initiatives to business performance, brands face other major pain points in managing their social business.

1. LACK OF FAMILIARITY APPLYING TRADITIONAL DIGITAL MEASUREMENT PRACTICES TO SOCIAL

MEDIA CAMPAIGNS. It’s not uncommon to find social practitioners with public relations or communication backgrounds thrust into the position of deciphering how to deal with changes to social platform APIs, or trying to make sense of which media, audience and content attributes should be collected and how. The skills required to design, deploy and manage social media initiatives really require a unique set of skills and thinking. This presents a people and process opportunity as brands organize for social business and look to interact with rapidly evolving mediums.

Forrester reported $1.2 billion was spent on social media in the U.S. in 2011.

The CMO Survey on Marketing and Social Spend (August 2012) shows social media spending will rise nearly 20% in the next five years.

Gartner recently predicted that CMOs will surpass CIOs in technology spend by 2017.

Social Media by the Numbers*

Facebook

- 618 million daily active users

- 680 million monthly active users who use Facebook mobile products.

Twitter

- 140 million active users

- 84 million active users who accessed content through mobile.

* As of December, 2012


2. DIFFICULTY IN RECOGNIZING RELATIONSHIPS BETWEEN

SOCIAL PLATFORMS AND OTHER DIGITAL CHANNELS. While social media may often create awareness, or serve as a first touch in the conversion funnel, it is less successful at closing the final sale. That’s why it can no longer be viewed as a stand-alone, isolated channel. Social has to be placed in context alongside, and integrated with, other digital channels, especially mobile, where adoption is faster than any other technology in history. As of 2012, 45% of American adults have a smartphone, and 31% of current users say they access online content using their cell phone.

3. INEFFICIENCIES ASSOCIATED WITH COLLECTING AND ASSIMILATING HIGHLY COMPLEX AND DISPARATE DATA

SOURCES. Social data is unlike other digital data, and it presents significant challenges to measurement professionals. The volume, variety and velocity of social information can overwhelm even the most experienced marketing expert. Collecting, reporting and analyzing data such as unstructured text, images, geolocation, device information – all coming at you in streams and in real time – is beyond the management capacity of a typical spreadsheet.

4. CHALLENGES OF SCALE, WITH DATA COLLECTION CONSTRAINTS AND LIMITED ACCESS TO HISTORIC

INSIGHTS. This is particularly difficult when using third party platforms that may inhibit access, be slow to upgrade technologies, or make it impossible to get the reporting or business story you need to make informed decisions.

“Entire conversations about your brand occur without anyone

visiting your website. And your social audience on YouTube,

Facebook and Twitter can be far greater than the sum of visitors

coming to your site. That’s why foundational measures for

social marketing analytics can act as a performance benchmark

to evaluate success across channels and competitors.”

– John Lovett | Author, Social Media Metrics Secrets

EXPERTS


5. BELIEF THAT YOU DON’T OWN SOCIAL PROPERTIES,

SO YOU CAN’T MEASURE THEM. This is a false perception; however, it remains commonly held. The good news is there is an explosion in the use and availability of APIs, which allow data from one site to move to an app or to a mashup with an online service. With data available through open APIs, it’s now possible to bring measurement practices to properties outside of the corporate domain.

NINE STEPS FOR DEVELOPING A SOCIAL MEASUREMENT STRATEGY Despite these challenges, marketers do have a path for gaining social marketing intelligence. In order to move beyond experimentation and prove business performance with social media, it’s crucial to develop a framework for social measurement. It’s also crucial to structure social media initiatives to include metrics that are important to the C-suite as well other teams, and include multiple layers of measurement to assess, explain and manage social media operations.

The following nine steps offer a framework for a social measurement culture.

1. SELECT YOUR USE CASE. Based on the social media measurement compass published by the Altimeter Group, a use case is a way to peg a path toward the goals and objectives of social business programs. There are six main use cases for social analytics: innovation, brand health, marketing optimization, revenue generation, operational efficiency and customer experience. They all present a set of tools for meeting social media goals.

BRAND HEALTHA MEASURE OF ATTITUDES, CONVERSATION

AND BEHAVIOR TOWARDS A BRAND

REVENUE GENERATIONWHERE AND HOW A COMPANY GENERATES REVENUE

OPERATIONAL EFFICIENCYWHERE AND HOW A COMPANY

REDUCES EXPENSES

CUSTOMER EXPERIENCEIMPROVING RELATIONSHIPS WITH CUSTOMERS,

AND THEIR EXPERIENCE WITH THE BRAND

INNOVATIONCOLLABORATING WITH CUSTOMERS TO DRIVE

FUTURE PRODUCTS AND SERVICES

MARKETING OPTIMIZATIONIMPROVING THE EFFECTIVENESS OF

MARKETING PROGRAMS

BUSINESS GOAL

Source: A Framework for Social Analytics, Altimeter Group, August 2011


It’s important to select a primary use case, as goals, objectives, and measurement requirements flow down-stream from this decision. For example, improving operational efficiency by increasing employee productivity or reducing costs would be measured and managed differently than a marketing optimization program focused on customer acquisition or loyalty priorities.

(See examples of use case applications on pg. 12.)

Once the use case is determined, the next step is:

2. DEFINE SUCCESS MEASURES AND KPIS. The key to this step is to select outcome metrics-based objectives and align them to corporate goals, and then define KPIs and success measures. For a Marketing Optimization use case that is intended to improve the effectiveness of marketing programs, success measures and KPIs might look like this, with KPIs that roll up to Objectives and align to corporate goals:

BUSINESS GOAL

ACQUISITION LOYALTY

CORPORATE GOALS

Gain Exposure

Reach

Velocity

Share of Voice

Foster Dialogue

Unique contributors

Conversation volume

Engagement

Generate Interactions

Conversion rate

Interaction rate

Offer take rate

Promote Advocacy

Active advocates

Advocate Influence

Advocacy impact

Objectives

Measures KPIs

MARKETING OPTIMIZATION

IMPROVING THE EFFECTIVENESS OF MARKETING PROGRAMS


3. ENSURE METRICS HAVE MEANING AND ALIGN TO

BUSINESS PRIORITIES. This is critical, because without context, metrics are just numbers. John Lovett, author of Social Media Metrics Secrets, frames metrics in four layers:

• Foundational measures are the building blocks

of social analytics and include elements such as

interaction, engagement, influence, advocacy, and

impact. They persist across channels and apply almost

universally to measuring all sorts of social activities.

Many business and outcome metrics are calculated

based upon foundational measures.

• Business value measures are specific to roles, such

as executives, legal, HR, sales or marketing, and are

the basis for communicating success and failure to

stakeholders across the organization. These measures

can include Customer or Employee satisfaction,

revenue, market share, etc.

• Outcome metrics help quantify the effectiveness of

social media programs, and align operational programs

to corporate goals. These are the key performance

indicators (KPIs) of social media, and include metrics such

as reach, conversion rate, velocity, etc.

• Counting metrics are the most basic and readily

available (number of Likes, reTweets, Views, etc.) and

are generally used to show tactical performance.

Unfortunately, these metrics are often used to

communicate business performance, when in reality,

they show program performance.

The key takeaway of metrics with meaning is that when communicating results, it’s important that the metrics used are consistent and repeatable, and that they are placed in the appropriate context of the measurement layer cake.


4. DECIDE WHICH DATA MATTERS. Before setting up a data collection process, it’s worth considering four key dimensions of social data to be collected.

• Recency: How current is the data from the time

of the event, and how important is it to know what

is happening immediately?

• Richness: How much information about the visitor profile

is available, how much should you collect, and how does it

help drive your business? This an important consideration

for measures such as influence and advocacy.

• Retention: How long is the data available? What is its

useful life? Not only is it important to understand the

life of a tweet, but also your long-term trend analysis

requirements. Can you go back through 12 months of

Facebook data to find the info you need?

• Realization: How will the data be used or consumed? Will

it be used to develop reports, populate dashboards or drive

marketing programs or other action systems?

Answers to these questions will likely feed back into your success measures and KPIs as you iterate and fine-tune your measurement mix. They will also help inform technology choices.

ALIGNING SOCIAL MEASUREMENT STRATEGY TO BUSINESS PRIORITIES.

Most companies treat social as checking off a box and then saying “we’re doing social” instead of stepping back and asking how it aligns with overall business priorities and marketing objectives. Yet, according to the August, 2012 CMO Survey conducted by CMO Insights, less than 7% of companies consider their social media efforts “very integrated.”

However, once marketing objectives are established, then you can develop the associated measurement in social. This involves asking questions, such as “do the number of reTweets prove ROI?” or “do Facebook Likes and Pinterest Pins improve our customer satisfaction score?” This alignment step helps address the challenge of meeting business goals, and justifying and defending investments in social initiatives.


5. CHOOSE THE RIGHT TECHNOLOGY. There is a spectrum of available technology solutions that enable social media programs. Which technology, or set of technologies, you choose depends on your use case, measurement framework, and people and processes to support the tools.

For instance, a use case that is customer focusing, such as Marketing Optimization, might include initiatives that are external (listening, content, engagement, advertising) and internal (workflow and automation, measurement). Several vendors have solutions that span more than one category. For instance, HootSuite has strengths within listening and engagement, while Webtrends has measurement expertise plus solutions that support the entire spectrum of external and internal initiatives.

Along with looking into how a solution will support your measurement framework, it’s important to also consider ease of setup, training, and availability of strategic consulting and customer service. The best solutions combine great technology with individuals laser-focused on your success with the solution. These are the experts who want to ensure you get the most out of your investment.

6. COLLECT THE DATA. There are many approaches for collecting data; however, links and tagging, and integrated measurement are extremely effective.

With links and tagging, Java script tags are the industry standard for conversion attribution and tracking. Webtrends developed an asynchronous tag optimized for all devices, including mobile, and is built to allow extensibility. Through a series of plug-ins to the tag, measurement programs can mature without requiring significant re-work of the tag. And by combining tag, API and link data, it’s possible to arrive at a granular level of insight.

Integrated measurement refers to applying metrics into social applications and social platforms, such as social apps, Facebook apps and collaboration widgets. As social and mobile experiences become harder and harder to tease apart, apps in mobile marketplaces must be considered for social measurement as well.


7. VISUALIZE THE DATA. Once a measurement framework is established, and the right tools, people and processes are in place to collect social data, then it’s time to become a storyteller and deliver analysis and recommendations — not reports.

With social initiatives gaining greater visibility within organizations, more and more individuals not directly involved in social operations are asking questions about its effectiveness and results. Data visualization can clearly communicate results to a wide range of stakeholders, translating the scientific reality of numbers into a more accessible format and social business story that can be processed and understood by people in an instant.

There’s a reason for the explosion of infographs and other data images, even in traditional publications like the New York Times, The Economist and Harvard Business Review. It’s easier to process information presented as an image rather than as words or numbers.

“Keep in mind the ROI on social media is

rarely straight math. Social activities won’t

always translate directly to dollars. You

need to factor in intangibles like exposure,

interaction and advocacy.”

– John Lovett | Author, Social Media Metrics SecretsEXPERTS

Webtrends offers data visualization, including story views, which automatically transform data from a tabular presentation to a visual narrative. Webtrends Streams® lets you see live data instantly and act on it when it matters most — while customers are engaged with your social, mobile or online property.


SUSTAINING SOCIAL MEASUREMENT EFFORTS

The first seven steps will help any company develop a social measurement framework. However, a social strategy should never end, but rather be sustained for the long haul.

There are two ways to do that:

8. OPTIMIZE YOUR SOCIAL MEASUREMENT STRATEGY. It’s essential that teams and sponsors responsible for social media initiatives establish a process for continuous optimization. A social strategy must constantly be tested, challenged, tweaked, and fine-tuned in order to ensure that it’s meeting the requirements of the business.

9. NURTURE A CULTURE OF MEASUREMENT. Work to ensure that everyone within the organization has a firm grasp of the medium, and are comfortable using it. Gain the support of at least one senior champion for your social media strategy. Benchmark successes and failures over time in order to allow you to differentiate between trends and anomalies. Standardize on terms and tactics, so you’re not lost in a potential quagmire of repetitive explanation. And bake measurement into every aspect of social media endeavors. It’s the only way to know if your initiatives are having an impact on your business.

Visual data tells a data analysis story better than a report filled with numbers.


SOCIAL USE CASE APPLICATIONSSOCIAL LISTENING. Algorithm searches allow companies to scour digital channels for mentions of both brand and competition, and attach a sentiment value to these mentions (positive or negative). Public relations professionals use social listening to understand how a brand is perceived in the marketplace.Use cases: Brand Health, Customer Experiences

SOCIAL SUPPORT. Connects customer contact records within a CRM program into a Twitter or Facebook account. This gives marketers the ability to take action not only on what is uncovered, but also to respond based on deep history.Use cases: Customer Experience, Operational Efficiency

SOCIAL INNOVATION. Product managers use social networks to understand what customers want in the next product release. There are framework tools available with which to co-develop products with key accounts.Use cases: Innovation, Customer Experience

SOCIAL ENGAGEMENT. If someone gives you a great mention on Facebook, you can use tools that allow response and posting, or set up an automated workflow that sends an alert to the team or person best equipped to respond.Use cases: Brand Health, Customer Experience, Operational Efficiency, Marketing Optimization

SOCIAL SELF-SERVICE. There are thousands of forums, communities or organizations where peers answer questions, such as groups on Yahoo. Although brands don’t take an active part in the conversation, it is a valuable tool for finding out what is being said about a brand.Use case: Brand Health

SOCIAL COMMERCE. This offers a shared experience for consumer activity, with recommendations, shopping, shopping near you.Use cases: Revenue Generation, Customer Experience

SOCIAL MARKETING. Brands can increase awareness, inspire engagement and lift conversions by running social campaigns across multiple properties, including YouTube, Twitter, Facebook, etc.Use cases: Marketing Optimization, Revenue Generation, Customer Experience


SOCIAL MEASUREMENT CASE STUDY: MOTORCYCLE SUPERSTORE

CRTten-fold increase

+0.50%

Motorcycle Superstore (Motorcycle-Superstore.com) is the leading retailer of motorcycle gear, parts, accessories and clothing in the U.S. Operating through the Internet for over a decade, the site receives about a million visitors per month.

To increase brand engagement, create a sense of community and drive traffic to the website, the company launched a Facebook page in the summer of 2009. To measure the impact of various ads and promotions, Motorcycle Superstore deployed Webtrends Analytics, already in use on the website, for its social media analyses.

Initially, the Facebook page was promoted by a single ad of general interest on the website, and the click-through rate (CTR) was 0.05%, which is the industry average.

Sports Bike persona Facebook ad 0.50% click-through rate - 10X increase

Original Facebook promotion ad 0.05% click-through rate

SUCCESS

13

“We began testing various strategies,” says Graham Hetland, social media community manager for Motorcycle Superstore, “focusing on specifically targeting different segments of the motorcycling community such as cruisers, street bikes, and scooters.”

“Most of the Facebook visitors are younger as compared to website visitors,” comments Hetland. “Analyzing this information lets us choose certain promotions for Facebook — for example, casual apparel, which appeals to this persona.”

Because users generally give permission for Motorcycle Superstore to access their demographic information, analysis by age, gender, and other factors is possible, enabling the company to create personas of targeted groups.

By monitoring response to the more targeted ad, Hetland discovered that the CTR had increased to 0.50%, a ten-fold increase.

Reach: 138,332 CTR: 1.7% CPC: $0.04

Reach: 212,835 CTR: .453% CPC: $0.17

Using Webtrends, Motorcycle Superstore can also track how much traffic is driven to the website from Facebook and other social channels, and track CTR, costs per click (CPC), conversions and referred sales, helping the company understand the success and ROI of their social marketing efforts.

The results?

Through segmented social ads, Motorcycle Superstore was able to increase click-through rates by an average of 10X, while increasing revenue from Facebook by 75% year- over-year – without increasing ad spend. These results were all possible because Motorcycle Superstore has developed a culture of measurement. Everything they do on Facebook and other digital channels is measured, analyzed, tested and made actionable.


WEBTRENDS ALIGNS TO DIGITAL ECOSYSTEM Webtrends understands that it takes more than technology to ensure that measurement is a valuable component to the success of market leading companies.

For social media and other digital marketing to show value to the business, a holistic solution must be adopted that will address key challenges and foster a culture of measurement.

CURRENT STATE DESIRED STATE

3 key challengesIncludes people, process and technology

Measurement strategy to inform metrics and standards

The appropriate operating model and analytics team structure to manage the requirements

Governance process to manage the reliability of data across the business

Well-designed structure to manage the standards and processes put in place

Necessary insight to enable business to implement a marketing strategy

Robust technical solution that allows visit and visitor level data to be collected and easily integrated into other marketing systems.

Any social measurement strategy, or social use case, should be iterative and ongoing, and align to business objectives. As marketing invests more heavily in technology and digital channels, Webtrends can help bridge the gap between business and technology, providing the roadmap, data intelligence and ROI needed to ensure success.


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Webtrends® WHITE PAPER. © 2013 Webtrends, Inc.

2013 WEBTRENDS® WHITE PAPER. © 2013 Webtrends, Inc.

measuring social return on investment

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