The Value of Being Social: Putting a Price on Friendship

By Dec 01, 2009

In the early days of social media, it might have been okay to bow to peer pressure and be “out there” simply because everyone else was doing it.

But times have changed. Today, social media is serious business with traceable consequences to your bottom line. Companies that take social networking seriously are investing significant money and people power into doing it right, and with good reason: Some studies show that time spent interacting with online communities like Facebook now tops the amount of time people spend with e-mail.

A recent McKinsey Quarterly’s survey of nearly 2,000 executives found 42% use social networking to deliver quantifiable results to their enterprises’ respective bottom lines. Of course, as we all know, the marketer is no longer in charge. The consumer is in control, and companies that can capture, analyze and act on the unstructured data wafting around the Web will come out on top.

A few questions will help you determine if you have the right strategy and tactics to be successful socially.

  • How are you monitoring conversations being conducted about your brand and offerings? Have you explored monitoring tools for social media, such as PeopleBrowsr?

  • Is your brand message carrying through, or being re-shaped positively or negatively by your clients, prospects and competitors?

  • Do your consumers truly know the breadth and depth of what you are offering? Are you truly listening to and engaging with them in social channels?

The key point here is that these conversations are not structured. They occur in loose communities that you don’t control. But, these communities can have staggeringly high clickthrough rates, a fact that should not be overlooked.

By the Numbers

We use this simple formula to gauge social media ROI:

Tactical Investment (A+B+C+D) ÷ Tactical Revenue = ROI

The typical tactical investment might be:

A=Agency one-time set up and training (25 hours)

B= Client hours (10 hrs./month)

C=Agency monitoring/enhancing/additional social media platforms (20 hrs./month)

D=Search/SEO (10 hrs./month)

Here’s another way to look at it. Consider the one-month yield for a hotel’s social media efforts:

  • Assume 1,000 very high-quality Twitter followers

  • Assume 250 Facebook fans

  • Assume the Web site has extensive SEO effort, including long-tail SEO

  • Assume 90 high-quality tweets over the campaign month

  • Assume 60 re-tweets over the campaign month

  • Assume 60 quality hotel/travel wall posts and 60 comments to others with links

This could translate to nearly 400 qualified potential customer Web site visits, configured with just a portion of the analytics a marketer could present to any CFO.

Keep in mind, we didn’t waste time trying the plethora of new media gadgets being proffered daily, each promising more data and ease of use than the next. Out of the thousands of apps available, only seven are seen as currently vital:

  1. LinkedIn: professional-to-professional networking

  2. Twitter and Facebook: to cultivate across-the-board networking

  3. PeopleBrowsr: to highly engage, assess, report across-the-board

  4. Hellotxt: to update your status across all of your social networks from one

  5. Google Analytics: to track social-media-generated Web site visits easily

  6. Bit.ly: to track all clicks for all postings made regarding your product or service

PeopleBrowsr allows for searching and tracking of every mention of any keyword that has relevance to your brand or service across all social media. If a tweet or a wall post appears asking about planning a vacation to Palm Springs, FL, for example, PGA National Resort & Spa can respond, “If you call us, we’ll offer our pre-arrival concierge even if you are not staying with us,” thus creating a one-to-one conversation with a very qualified prospect. Google Analytics is the best free tool delivering robust Web site analytics. And Bit.ly, a URL shortening app, allows you to track all related links back to your Web site from any social media platform postings.

Lastly, both Twitter and Facebook can be incorporated into Microsoft Outlook. This allows you to continue working on other projects and tasks while responding only to information that is pertinent to your social media efforts.

Bing, the new search engine from Microsoft, now indexes micro-blogs (Twitter, Facebook, LinkedIn, etc.) every hour. Google and Yahoo will very soon be offering such just-in-time indexing. That means your tweet now impacts your search engine optimization programs.

Consider all of these options next time you’re chatting with your CFO about the worth of social marketing.

Christopher Regan is director of search and social at HyperDisk Marketing, Inc.