The Bolin Marketing Blog

When the CEO asks, “If I spend $1 on social media or other digital marketing strategies, how do I get the value of $2 back?”  This is the age old question all marketers have faced one time or another when trying to justify their marketing budgets and sometimes their very existence.  In other words, it’s all about guaranteeing that elusive ROI in order to make a go, no-go decision.  What is your answer for the CEO?  Do you know what ROI metrics would be important to measure and justify your online campaign?

As a public service here’s Wikipedia’s definition for ROI:  In finance, rate of return (ROR), also known as return on investment (ROI), rate of profit or sometimes just return, is the ratio of money gained or lost (whether realized or unrealized) on an investment relative to the amount of money invested.

Here’s how ROI measurement worked in the pre-digital marketing world.  With traditional advertising if you ran a price sensitive ad in the daily newspaper you could measure the impact (and ROI) almost immediately for the items in the ad based on the “ringing of the cash register.”  The simple ROI metrics were sales minus expenses.  If your campaign was based on raising awareness you have a different set of research metrics that measured selected criteria like aided and unaided recall of the pre and post campaign, consumer engagement, believability, response to an 800 phone number and maybe, maybe even a simple measurement like a lift in sales.

Now with the advent of digital analytics there has never been a better environment in the history of marketing and advertising to measure and track ROI investment.

According to the 2010 CMO Council, State of Marketing Outlook report and survey, CMO’s identified the top measures and metrics for quantifying the effectiveness of online marketing or advertising campaigns to include:

•    Web site page views and registrations (64 percent)
•    Volume and origin of site traffic (60 percent)
•    Acquisition of new accounts or opportunities (48 percent)
•    Search prominence and site preference (46 percent)
•    Incidence of content downloads (37 percent)
•    Transactions and/or subscriptions (37 percent)

Social media measurement metrics have the ability to go even broader.  You’re looking to measure conversations and trying to find out where interactions are taking place and what content you’re putting out that spurs those interactions. Criteria might include conversation velocity, conversation share of voice and conversation sentiment towards your product category/brand.

At Bolin, we’ve conducted a number of social media audits for our clients as one form of online measurement.  From these audits we’ve been able to recommend strategies to our clients that can drive objectives such as awareness and/or trial.  The resulting behavior changes and/or sales form the basis for further ROI analysis.

The answer to the original question of how $1 in spending results in $2 of sales may still be elusive but here’s what’s not.  It’s a chaotic marketplace.  Even with all of the measurement analytics listed above it’s still a “young” test and learn environment.  In order to turn the journey into a destination, clients and their marketing agencies need to collaborate up front to determine what success measures are important to their campaigns.

Once you agree on success measures and objectives you can structure social media campaigns to deliver instantaneous results, longer term brand awareness or both.  If you do the things you’ve always done, align your marketing objectives with the right strategies and tactics you’ll be able to find an ROI in the new digital world.

Sometimes doing nothing is the right ROI but not doing anything because the ROI is not totally transparent means $1 may never become $2 or $3 or $4.  What are your online success metrics?

Many organizations have begun to use social platforms as a direct channel to their audiences. Following is my presentation to the Minnesota Direct Marketing Association annual conference that demonstrates how to do more than just have a social presence by showing you how to identify strategies that meet your organizational objectives and then how to track and measure success. In this presentation, I propose 3 primary strategies for reaching common marketing objectives. I’m interested to learn what other strategies are being used to reach both business and broader organizational needs.

As everyone has probably heard by now, the famous “Become a Fan” button on Facebook will soon change to a “Like” button. This seemingly insignificant label change is presumably aimed at helping lower the barrier for interaction among Facebook users. No longer are people posed with the internal question “Am I really interested in a page’s content so much as to  become a FAN of the page?” Rather, they probably only will ask themselves “Hey, I LIKE this content and I find it interesting.” The perception change for users probably encourages interaction with content. Facebook has been reportedly notifying agencies of the change and is recommending that they use “Find us on Facebook” or “Like us on Facebook” for the changed verbiage.

But what does it mean for Marketers within Facebook? One could argue this is Facebook’s attempt to better serve users and build user communities, thumbing its nose at what has likely become a key engagement measuring point for brands and companies. It seems people will generally be more inclined to “like” content than become a “fan” of content, because “liking” something is far less committal than becoming a “fan” of something.

This linguistic change poses some interesting depth-of-engagement questions. How does this simple label change affect key performance indicators for a company or brand? More importantly, how does it change the perception of their value to brands and companies? Does it have detrimental or positive effects on the engagement metrics used by Fan Page administrators? And for users, should “Fan Pages” now become “I Like” pages?

Thanks to Adam Hart for finding this timeline showing the online PR battle between Nestle and Greenpeace . How could Nestle have handled this better? Seems like the traditional PR model of control only fueled the flames.

A few people asked me to take a look at Domino’s online sentiment profile for their new pizza vs. previous sentiment of their “so bad they needed to change it” pizza. From the graphs below, you can see the Domino’s new pizza product hasn’t really delivered on expectations. While there’s a couple percentage points for margin of error, it looks like positive sentiment dropped, and negative sentiment increased as well as neutral sentiment. This was based on a sample of roughly 6,500 online mentions. I have not tried the Domino’s new pizza recipe yet, so I can’t weigh in with an opinion. We do work with Schwan’s consumer brands which include frozen pizza, so I just wanted to make that clear for transparency sake. Thanks to Consumersphere for putting this data together.

Domino’s New Pizza Online Sentiment Comparison, originally uploaded by TaulPaul.

Did you know that employees who use Facebook at work are 9% more productive than those who don’t? I’m often asked to present on why companies should let their employees use social media. Here is my pitch. Would love to get feedback on how others approach this – especially helping companies mitigate legal risks.

I was getting back from lunch with a colleague, and a thought hit me. We monitor online conversations of people when they talk about us, and talk to us. Do you sit at a dinner party, and only listen to people when they talk to you, or about you? Don’t you learn about people when you listen to them when they talk to others? Being a good listener is taking cues when it’s appropriate to respond. It’s all about timing. We want to be better at timing. You can’t have good timing when you’re not listening correctly.

So, let me illustrate how it works today. Bob says something bad about Product X on his blog. Product X’s team has listening tools, and are alerted to Bob’s post. Product X’s team, posts an appropriate response on Bob’s blog comments. Makes complete sense, right? Bob has a problem, and Product X tries to alleviate that problem. Problem solved. Product X, then swoops away in the middle of the night until the next comment is made referring to them. That sounds like a pretty weak way to build a relationship. It’s a start, but we can do better.

What if we listen to fewer people. The people who are interested more in us. We listen even when they’re not talking about us. If they’re having a bad day, we reach out, and do what we can. Is this possible? Can we measure how it affects them in the minutes, hours, days, and weeks afterward? Remember, we’re talking about people, and people have emotions. We’re building connections and relationships, one person at a time.

As experts in digital marketing, we often find ourselves talking a lot among peers about social media – what it is, the  value it provides, how we leverage it for our clients, and so on. And we find ourselves (generally) nodding in agreement.

But that’s not always the case with people outside the realm of the social media industry, practice or study.

We firmly believe that social media strategies and tactics can have huge impact for specific clients. But we also erroneously assume that everyone around us also understands the imputed or explicit value it can provide. It goes without saying that many marketers are skeptical about social media, especially when they’ve grown accustomed to traditional measures for marketing activities in the mix.

After all, it all comes down to dollars, comfort with what people know, and discomfort with what they don’t know.

Definitions like reach, awareness, frequency, preference, recognition and recall are generally understood by seasoned marketing folks. Social media, however, requires new definitions and new measures, like conversation, sentiment, velocity and online share of voice. These new definitions need to be matched against old ones and compared and contrasted regarding their value. Social media has the ability to take customers deeper into the product, service and brand experience. There are varying discussions on how to measure it objectively and subjectively, too. We’re finding that comparing the value of traditional media and social media is an apple-versus-orange argument.

We are not only talking about different types of measures for different types of consumer activities, however. In true Gerald Zaltman fashion, I came up with another metaphor (a little more elaborate than apples and oranges) to explain what I think is also happening with social media. For instance, consider the effect the alternative fuel car (social media) will have (or, is having) on the infrastructure and market for gasoline and gas-powered cars (traditional media and marketing).

For example (here’s just one), the electric car will soon make up a significant mix of all road-bound vehicles. Why? The very existence of the electric car challenges the infrastructure of gasoline distribution, not to mention the market for oil itself, by reducing demand for gasoline and the need for gas stations (presumptively, because people are more carbon-footprint conscious and are coming to terms with the inefficiencies of the gas-powered car). There’s a (presumptive) growing demand for alternatively fueled vehicles which is fundamentally changing the way we perceive and measure value in our commuting and consuming lives. (Reference what’s happened in Detroit).

Let me take that same paragraph and substitute some language:

Social media will soon make up a significant mix of all media spends for many marketing initiatives. Why? The very existence of social media challenges the infrastructure for media distribution, not to mention the market for traditional media itself, by reducing demand for traditional media and the need for media placement (presumptively, because more people are understanding the benefits of social media’s efficiency in connecting with consumers, dollar for dollar). There’s a growing demand for social media which is fundamentally changing the way we perceive and measure value in our marketing mixes. (Just look at this tiny example of efficient local marketing).

I’m not saying traditional media (on and offline) and gas stations will go away entirely. And I’m not saying social media has evolved as much as the alt-fuel car. There is a lot of change happening, however. And this is just one metaphor to help explain it.

What do you think?

Minneapolis and St Paul have become a hotbed of social media so it’s no small feat to make it into a list of top innovators. Although TaulPaul comes by his interest sincerely, he is lucky to have clients who are savvy enough to recognize the opportunities he brings to them. Congrats Paul!

Here is the official list of Top 20 Social Media Innovators:
http://tinyurl.com/lq7neq

Social Email Campaigns Expected to Increase Nearly 400 Percent in 2009

A record number of email marketers plan to bridge the gap between online social networks and their email marketing campaigns in 2009, according to new research from Ball State University, the Email Marketer’s Club and ExactTarget.

The study surveyed 351 email marketers in March and found that while only 13 percent leveraged the power of online networks last year to grow their email subscriber list, more than 46 percent plan to use social media and email in tandem in 2009.

“While the global reach, rapid adoption and high engagement found in social media have email marketers salivating at the potential these environments offer to engage with customers and prospects, the real challenge is how best to facilitate meaningful interactions,” said Morgan Stewart, ExactTarget’s director of research and strategy.

Although the demand for the integration between social sites and email is surging, the success with the integration remains largely uncharted, according to the study featured in ExactTarget’s newest whitepaper entitled, “Expanding the Reach of Email Through Social Networks”.

“Consumers are reluctant to invite marketers into social environments, and this is because they don’t want to see the channel overrun with irrelevant commercial messages,” Stewart said. “However, marketers who are able to align their messaging with the distinct mindset of consumers engaging in social networks are posting positive results and building a quality following in these environments.”

The whitepaper features research that highlights how brands such as Carmex, TripAdvisor and Papa John’s have scored success by broadening their communications to include social media sites such as Facebook, MySpace, Twitter, Digg and others to their traditional email-based efforts.

“We want visitors to share the experience with their friends, but we don’t want to force them to use a channel they are uncomfortable with,” said Paul Woelbing, president of Carma Labs, the maker of Carmex (a Bolin Digital client). “By offering visitors choices, we are learning a lot about the dynamics of integrating email, social media and text messaging – namely that they complement each other very well.”

The release of the whitepaper follows Tuesday’s launch of ExactTarget’s Social Forward, its new flexible metrics-driven social sharing solution for email. Debuted at ad:tech San Francisco, the new functionality gives marketers the industry’s first social media integration for email that allows multiple ways to leverage sharing and provides the industry’s most complete solution to enable and track sharing through its Direct to Social capability and through a partnership with social media syndication powerhouse ShareThis.

ExactTarget’s Social Forward will be available to users through its online Innovations Lab starting May 1 and will become an integrated solution for all ExactTarget users worldwide as part of the company’s Summer release.

The whitepaper and an overview of ExactTarget’s Social Forward technology are featured in ExactTarget’s Social Media Kit for Email Marketers. Marketers may download the kit free of charge at www.exacttarget.com/socialmediakit.