Your organization has recently jumped on to the social media bandwagon and is now engaged in a number of social channels. But what does this mean for your organization and the bottom line? How do you know if the social media strategy you have implemented is effective?
Merlyn Gordon, Director of Solutions Marketing at Webtrends, says a major trend he has observed is the expectation that marketing departments can prove the value of the social strategy and tactics they’re using and tie them to business results. While many organizations have a social media strategy in place, an unfortunate number of them do not have a measurement strategy to prove the value of the strategy and its ROI.
In an Altimeter Group report, it was discovered that “48% of corporations made social media ROI a primary focus in 2011, yet just 56% of companies who identified as advanced users of social media had standard measurement frameworks in place to help benchmark ROI.”
In order to measure the effectiveness of social media tactics, it is essential that organizations have a measurement strategy in place. Organizations must have clear goals they want to achieve, and implement measurement tools that are aligned with those goals to confirm either success or failure of the social media strategy.
John Lovett, author of Social Media Metrics Secrets, also makes a valuable point. It’s important to remember that “the ROI on social media is rarely straight math. Social activities won’t always translate directly to dollars. You need to factor in intangibles like exposure, interaction and advocacy.”
A case study: Motorcycle Superstore
Motorcycle Superstore is one of the top 500 internet retailers in the United States, offering a range of products from motorbike gear and accessories to clothes and snowmobiles. They also have a retail location in Louisville, Kentucky.
Motorcycle Superstore recognized early on that social media was a tool they could leverage to increase brand engagement, to create a sense of community with customers, and to drive traffic to their website. So in 2009, they took a big leap into the social media world and launched their Facebook page.
To determine the ROI of their Facebook page and whether or not it was meeting their needs, Motorcycle Superstore implemented Webtrends Analytics for its social media metrics.
When the Facebook page was first launched, the only thing directing users to the page was an ad on their website. This approach led to a click-through rate at par with industry average at 0.05%.
Motorcycle Superstore then experimented with targeting specific segments of their customer base in their Facebook ads, such as street bikes and cruisers. They found that this targeted strategy led to an increase of 10 times more click-throughs, going from 0.05% to 0.5%.
The company was able to further breakdown customer segments by collecting demographic information from users (with consent). This allowed Motorcycle Superstore to target customers who would be most receptive and interested in what they were offering.
Beyond click-through rate, Webtrends also allows Motorcycle Superstore to track several other social media metrics:
- amount of traffic driven to their website from their Facebook page and other social media channels (i.e. Twitter)
- conversions and referred sales
Socialbakers.com is a free social networking analytics tool. Socialbakers.com’s Motorcycle Superstore Facebook Page Statistics in United States shows 649,630 fans and 29,043 people talking about the brand as of November 5, 2013. It also allows the organization to track trends in fan numbers, trends in people talking about Motorocycle Superstore, and fan growth.
All these metrics provide Motorcycle Superstore with the data it needs to determine the impact of its social media strategy and whether they’re meeting the goals they originally set out to achieve through these tools.
The result? Through its segmented social ad strategy and ability to analyze the information they collect through Webtrends Analytics, Motorcycle Superstore:
- increased click-through rates by 10 times, and
- increased revenue from Facebook by 75% (without increasing ad spend by even a dollar).
Using social media channels to help achieve business goals can be broken down into a basic three-step process:
- Set measurable goals.
- Ensure metrics align with those goals and priorities.
- Implement appropriate social media analysis tools to determine if your social media tactics are meeting your goals.
Submitted by: Candace Berner-Rubie – SMBP Student, University of Waterloo.
If you have concerns as to the accuracy of anything posted on this site, please send your concerns to Peter Carr, Program Director, Social Media for Business Performance.