Over the last week or so, I’ve been devoting all of my time to developing a new talk based on the role that measuring and quantifying plays in social media if you’re a smart business, and how you should do something useful with these measurements rather than just looking at what’s happened and trying to work out why it’s failed.
As our sophistication about social media develops, we become more aware of the role that measurement plays. Putting numbers against each of the key measurables is a vital step in understanding your business ROI from social media. But it is just a step. The follower and comment statistics for our brand and campaign are meaningless if they don’t deliver a bottom line benefit.
Anybody who has studied business or run a business of their own will recognise that what a business does is basically very simple.
You buy stuff and sell it at a profit. That’s it…. It doesn’t matter if we’re talking products, services, time or a combination of all of these things, the model is very, very simple. Clearly there are functions which the business needs to have in order for this sale to take place. Marketing, HR, Accounting, Sales, Engineering, Facilities…but they are all there to facilitate the sale which is the engine that drives the business. Even hospitals, charities and governments run in basically the same way, except that their ‘profit’ is not expressed in terms of money.
Everything the organisation does should make the sale happen better – faster, more frequently, bigger, more reliably, to more people. Social Media’s role like every other business function is to facilitate this streamlining.
So why do SM agencies and consultants talk about Return On Involvement or Return On Engagement or return on ANYTHING but Return On Investment?
Because they either don’t understand ROI, can’t measure the return on the investment the client has made with them or – more worryingly – they don’t want the client to see that their work is failing.
ROI is a business metric, and must be applied to everything. If you invest £100 on social media (consultancy, your time, copywriting…) if you can’t measure a £100+ return then that money has been wasted because your business would have been better off NOT doing it.
If you’re not measuring the results then that’s crazy, because how can you possibly make an informed decision without being informed!
So, enter “Reverse Metrics” (my idea!) the science of reverse engineering your social media efforts, measurements and strategy to deliver a given result.
If this sounds like the sort of concept that you, your clients or your partners could benefit from then please drop me a line.
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