Social Media Measurements for Success: Beware of Jargon

ROI is quite possibly the most abused term in marketing. It was just a matter of time before white papers, articles, and ROI evangelists hit social media without the pedigrees of a seasoned CMO or CFO to set them straight. Furthermore to frame this short write-up, ROI is a valuable tool for the measurement of a business investment, but has failed marketeers for decades just the same.

Let’s take a quick refresher on why ROI fails:

  • ROI is often used as a catalyst and  justification for a business endeavor. To simplify, think of ROI as the leather seats in a luxury SUV, or even the premium brand emblem on the hood. ROI is the promise on which marketing gathers budget. ROI is a forecast for which a marketing manager will buy into a project. Rarely is it realistic because most everytime it is based upon team negotiations as to what success NEEDS to look like for upper management.

  • ROI is almost always developed solely by marketing, production, or sales. By this point the whole mathematical purity of ROI is lost. Having a disconnect between marketing, sales, and production is nothing abnormal in industries such as the high-tech industry. If we look at any tech company for example: A marketeer will never be fully informed as to how many billions of dollars went into the creation of a processor, and how that impacts the mandated ROI of their marketing efforts. Nor will they be able to predict what value that processor has to bear on the market simply by launching.

Likewise the ROI goal for a campaign that runs in paralell to this launch will suffer because it cannot not show a direct impact. I can say though that failing to interact, in my opinion will most certainly create a lack of a sales pipeline for future products.

  • Lastly, social media is always changing. When a medium continues to change, the positions and services that produce the medium bears a price at which the market will bear due to its flurry of fascination and fear of being left behind, not at which will make a product profitable. Because of this situation, at this current point in time, measuring ROI will fail for the majority of Social Media campaigns. The widgets are unpredictable in price.

Ok…so what can we measure?

What I am urging my clients to measure is a Return on Interaction. Come back for an in depth talk on how this impacts my clients as they launch campaigns internationally.

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9 comments

  1. […] This post was mentioned on Twitter by Social Media Geek, Social Media Geek and Social Media Geek, Social Media Geek. Social Media Geek said: @markorlan ROI, jargon and Social Media: http://ow.ly/wRvB […]

  2. Thank you for this great post. As many people are trying to understand the value of social media to their business, ROI is used a lot. In all reality, it’s more like return on interaction or return on engagement.

  3. Milena thanks for the comment!

    It definitely is a return on interaction/engagement. I have been using this quite a bit when working with the various brands that I engage with. At this point it is somewhat dangerous to think in terms of ‘ROI’ unless you can show that there is a direct correlation between a social media campaign and an actual profiting business mechanism.

  4. Thank you for this great post. As many people are trying to understand the value of social media to their business, ROI is used a lot. In all reality, it’s more like return on interaction or return on engagement.

  5. Thank you for this great post. As many people are trying to understand the value of social media to their business, ROI is used a lot. In all reality, it’s more like return on interaction or return on engagement.

  6. Thank you for this great post. As many people are trying to understand the value of social media to their business, ROI is used a lot. In all reality, it’s more like return on interaction or return on engagement.

  7. Thank you for this great post. As many people are trying to understand the value of social media to their business, ROI is used a lot. In all reality, it’s more like return on interaction or return on engagement.

  8. […] This post was mentioned on Twitter by Social Media Geek, Social Media Geek and Social Media Geek, Social Media Geek. Social Media Geek said: @markorlan ROI, jargon and Social Media: http://ow.ly/wRvB […]

  9. Thank you for this great post. As many people are trying to understand the value of social media to their business, ROI is used a lot. In all reality, it’s more like return on interaction or return on engagement.

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