For those who don’t feel like reading, here’s the spoiler: according to the Social Media ROI specialist group, the social media ROI will not be generally calculable. Of course, this does NOT mean that social media ROI does not exist. There is no such thing as the one ultimate and universal number or formula. Rather, it is a highly individual story.
I didn’t find this assumption all that surprising or frightening. Here are my five insights from an interesting and exciting day at EDEL Music in Hamburg . In addition to the presentations and the exchange, the presentation of the approaches to measuring success, which the BVDW is currently trying to develop as standards, was the highlight for me.
Finding 1: Measuring success is a broad field.
This was already reflected in the expectations of the participants. From the status quo of social media ROI considerations, to the question “what is a Facebook fan worth?”, to an overview of the possible tools that can be used. From my point of view, the terms are far from being clearly separated or interlinked. Social media monitoring, web monitoring, web analytics, market research, social media statistics, these were the terms that came up. For me, the key finding: there are two aspects that these tools can achieve:
1. Carry out a business evaluation as part of a success evaluation
2. Provide insights as part of market research
Insight 2: Language is the source of all misunderstandings.
So many tools, so many possible uses and sooooooo many key figures create one thing above all: confusion .
My neighbor Sandro, from the advertising bots , and I managed to talk to each other for about 3 minutes about the engagement of Facebook users, until we came to discuss our mutual understanding of this key figure. It wasn’t really identical. The tendency was right, but the formula that he had in mind and that was in my head had little to do with each other.
And that’s just one of an infinite number of possible indicators. In his presentation, Marco Ottawa (head of secondary and special market research at Telekom) presented an estimated 40-50 key figures that are used internally. Clear definitions are needed here: which key figure? what kind of survey? what periods?
Insight 3: A single currency is the basis for exchange and calculation of social media ROI.
Both for exchange within the company (evaluation of success) and for exchange between parties. The discussion about the evaluation of advertising performance between Patrick from Factor 3 and both marketing colleagues from sportfive was exciting: How can I measure social media reach and evaluate it in my campaign planning?
Which key figure allows planning of reach and budget, creates comparability between channels and afterwards evaluation of success? Does a Facebook post, blog post or tweet have a CPM that makes it comparable to other forms of advertising? Highly exciting for considerations about the monetization of reach. There was no final approach and the question remained: How do you distribute the transaction risk? Can one be paid for potential reach in the form of x-thousand views on Facebook? Can you push the “marketer” to CPC or CPL deals?
Finding 4: The goals define the key figures and these define the tool
A frighteningly simple but infinitely true sentence. It is not the tool we have chosen that defines what we (must) measure. What we want to achieve is the basis for the key figures that evaluate success or failure. When we know what we want to measure, we can choose the appropriate tools.
Finding 5: There is social media ROI.
A confirmed belief for me. I still believe in it. And it is also predictable. The ROI has a clearly defined formula , but not a universal one. My gain (or cost reduction) attributable to social media ROI? Very difficult to raise. My capital investment? Perhaps it can be ascertained using budgets, agency costs and personnel expenses, but it is also complex enough. Compared to such excellent, predictable performance marketing channels as Adwords, the calculation of the social media ROI is in many cases really just a finger in the wind.
My thinking: Better to look with one eye than blind.
I like measurability. For me, the crux of online marketing is still the belief in measurability or ignoring the fact that tracking is never 100% clean. Each channel can be evaluated. Only the accuracy varies. You have to be aware of that when you are based on these numbers.
Better to have an eye than to be blind, or as Maren Heltsche put it: map and compass are more accurate and therefore better than map and position of the sun.
Conclusion: We are on the way, but not yet there with the social media ROI.
I was able to mentally tick everything that Anna-Maria Zahn presented about the considerations of the Social Media specialist group and standardization. Correct insights, good summary. Partly not necessarily pure rocket technology. It has been preached since the beginning of 2011 that fan and follower numbers per se are not a success. And since it is confirmed from a competent source, the matter as such is certainly not detrimental.
What it seems to lead to is not the social media ROI world formula, but rather a toolkit of key figure definitions and measurement methods, which are then selected and used individually for my application. It is urgently necessary to standardize the numbers and collection procedures. Otherwise we will never be able to objectively compare and evaluate them. What the BVDW has in the pipeline is a well-structured basis for it. Will she be accepted? I am excited.
All in all, a very worthwhile event with good speakers and participants who were open and open to discussion and once again made it easier for me to think outside the box. Thanks very much!
In the evening there was the BVDW’s New Year’s reception in the Business Club . But more on that another day.