The ROI of Social Media Engagement

Following the announced strategic partnership with DQ&A, I was asked to share some thoughts about ROI and “Social Media Engagement” for their newsletter. Below the outcome as it was published, by no means it is all-inclusive, so you are invited to add, comment or let me know what you think… - RvH –

The ROI of Social Media Engagement

Social Media was called “a hype” in the beginning of 2010, by the end of the year it was here to stay. Many organizations started to use social media for (mainly) reputation management. When asked about the results, the answers usually consisted of many words but few facts & figures.

Organizations are now taking the next step by truly engaging with their audiences via social media. Why? Because consumers are demanding it. Furthermore, tools have been developed helping organizations to efficiently manage their fanbase, while measuring and analyzing the impact of their engagement.

The year 2011 will be about the ROI of social media engagement, showing social media is a game-changer in almost every industry.

What is the ROI of Social Media Engagement?

Maximized exposure

Every entity has its own mission and or ideas for using social media. For many institutions spreading a message to as many people as possible is the main objective. The return is maximized exposure without  any significant additional costs.

A good example of this would be government institutions who mainly have an informative mission for health & safety purposes. By spreading a message real time (for instance during a natural disaster such as the Tsunami in Japan), making use of social media can contribute significantly.

Improved Customer Service

Now that producers and consumers have found each other on social platforms, consumers are demanding to be served through this newly available channel. Why would consumers pick up the phone, make additional costs while being “on hold” in lengthy queues, if they can also get real time social customer service for free? The Dutch Railway (NS), KLM and Bol.com are just a few examples of companies who have already discovered the value of being connected.

Then what is exactly the return of a happy customer being served by these social “call” centers or web care teams? This is of course difficult to say. At the same time think about what the Return of Not Investing (RONI) would be, if your competitor does?  Are you willing to take this risk? Social media will not replace traditional channels completely, but it will become an increasingly important additional channel.

Increased Revenues

For most organizations return on investment means: “showing the money”. Mostly this is achieved by creating traffic via a campaign or message, leading the fans towards a webshop where they can purchase a product. Tools are now going beyond the ‘click through rate’ by measuring how much additional revenues are generated via social campaigns and through which social networks. Social commerce triggers audiences to a new type of impulse purchase, while actually being within their own social network.

For example, Greetz.nl an online platform for sending postcards, have experienced up to 80% increase in social media revenues (within 4 months), which are directly contributable to social media campaigns. It shows that engaging via social media pays off.

Knowing your fans

The biggest return lies with really getting to know your fans by engaging with them, preferably on an individual level. Therefore social media needs to be integrated into the various processes and disciplines of your organization such as marketing, pr, customer service and sales. Once an integrated approach is taken an organization learns more about their fans and for instance their personal preferences. These learning’s via social media will take lead generation or re-marketing to the next level.

Sophisticated tools are needed to execute a social media strategy efficiently, especially with a larger fanbase. With these tools indicators are showing which social network performs best in activating your audience and who your super promoters are, ie. those interacting with your brand frequently and forwarding your messages within their own networks. This increases your exposure and also improves your ranking in Google.

For your organization to be future proof it should get ready to satisfy the demand of future generations. Generations who will undoubtedly be community oriented, always connected and almost have no other reality than online reality.

Ralph van Hooijdonk

Managing Partner

Media Injection

www.mediainjection.nl

@mediainjection

Mobile: 06-21115997