As 2011 wraps up I’m reflecting on the main themes I’ve encountered in my business practice, speaking engagements and social communications this year.
Across all channels the one topic that was consistently questioned, caused frustration and confounded even the most gifted of business leaders was the concept of social media measurement.
My professional focus is helping clients to quantifiably increase and measure the value they receive from prospects and customers through online and offline interactions across the entire customer lifecycle, so naturally the debate over how – or even if – social media efforts can be measured was of great interest to me.
With the exception of a rare few, businesses do not have a handle on the bottom-line impact that their social efforts generate for them, yet most seem to want or need it. 80% of executives surveyed report that hard data is needed to support social media marketing efforts yet only 26% of those same marketers claimed they’re capable of providing meaningful measurement (ROI) data*.
So what’s the issue? Is it a lack of technologies to measure the business benefits of social engagement? Or is it the lack of education business executives have to be able to identify the bottom line impact of business activity? The answer is neither.
A measurement as old as time
As long as there’s been commerce and trade, (successful) business people have understood the basic principle of ROI measurement: for every $1 the business spends, there is an expectation that $1+ will be generated in return (directly or indirectly, short or long term). Simply put, when this is not achieved, the business fails. Further, when every actions the business embarks upon cannot be equated to this simple rule, the business has no clear definition of what is and isn’t successful within its operations and thus decreases its ability to prosper in the future, if at all.
Technologies used to chart customer engagements across their lifecycle are plenty and growing in sophistication each day, so that’s not an excuse. And so we’re back to square one; why aren’t social media engagements being measured?
Profit is not a 4-letter word
Many have argued that social engagement cannot – and should not – be measured. They equate social engagement to office equipment, asking: “Well, what’s the ROI of a stapler”? The argument is that not everything in a business is measured, yet necessary for the business’ operations – such as a stapler. My response: bullshit. Notice that the marketers making such claims never say: “Well, what’s the value of Customer Service?” or “Well, what’s the value of Sales?”.
In business, every expenditure including the stapler has an impact on the bottom line. Of course the costs of tracking and measuring some expenditures far outweighs the benefit so no calculation is attempted. But this doesn’t mean it doesn’t contribute a value.
Others will proclaim that the value of social engagement with consumers and other stakeholders cannot be measured by ROI but “goodwill”. My response: bullshit. I’d rather own a business that has no goodwill and lots of profit than the reverse. Remove public awareness, goodwill or any other branding exercise not easly or quickly linkable to profit from a successful business and monitor the bottom line and you’ll quickly realize its impact. Just because it’s not linear or easy to measure, doesn’t mean it can’t or shouldn’t be measured.
So it’s laziness then? Executives are not willing to invest time or money in measuring what’s not easy to measure? While it may be the case with some individuals, the business’ investors, bank managers or the board of directors will call bullshit and force the issue so I don’t believe that’s it either.
A matter of courage
In my experience, and over the last 5 years in particular, the real reason marketers shy away from social measurement isn’t due to a lack of knowledge, budget or technology. It’s a lack of courage; the courage to be held accountable and responsible for their efforts.
I’m always amazed when marketers reject the “measurement” feature within my business proposals, which offers to measure the social engagement campaigns we’re hired to perform for their businesses to bottom line results.
They’re quick to hire us to help them engage their prospects or customers but not to gauge results by impact on profit, even though we’re willing to hold ourselves accountable. They’re satisfied to present increased metrics (number of views, number of followers, etc.) to their executives and present them as success measures.
Reality check: metrics are not measurement. Metrics are indicators; they’re contributing factors to measurement. But mostly they are the modern-day “cover your ass” tactic of the marketing world. I’m tired of the whining and slight-of-hand employed by marketers hiding behind metrics to mask their inability to link their efforts to profit.
Grow a pair.
By Sam Fiorella
Feed Your Community, Not Your Ego
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* Ifbyphone North American Survey, Dec 2011