One of the questions that always appear when discussing about social media marketing is how to measure the success of a campaign, how it affects the revenue, and what is the return of investment. These are indeed difficult questions and a straight answer is not possible. You must take into account various indicators and always keep your real purpose in mind: getting in touch with your most socially active and influential customers. These indicators can help you understand how to handle such an elusive target:
- Number of joiners (likers) – This indicator is actually not the best way to measure success. The reason is simple: the number of likers in itself does not bring anything to the brand. It is a vanity metric. One may think that the bigger the number of likers, the bigger the coverage for future marketing messages. This is not entirely correct, as Facebook uses an algorithm which actually takes into account the strength of the connection between the liker and the brand, and the type of the content published by the brand. If for example, I decide to publish a trivia comment such as “What do you think of the phone XXX” and hope to engage all my likers, I’ll be disappointed. Such messages reach only 3-7% of the total number of likers. Pictures and video have a bigger success, but likers’ level of engagement is of the greatest importance. This means that any marketing strategy has to focus on increasing the engagement of the users instead of collecting new likers. To read more on the topic, please see this article.
- Level of engagement – As already mentioned, the level of engagement is actually the weight of the link between the brand and the liker. This is a valid metric but difficult to calculate or evaluate. The way to increase engagement is to constantly involve users with relevant content, social games, contests and useful features. The Facebook insights (or tools that use Facebook insights for analysis) can give a good picture as far as the level of engagement is concerned. It is about the share and comment ratios for the posts published on the page. This, in turn, depends on the type of brand, the number of posts, overall quality of the posts, targeted users. The trends are more important here and could signal a successful or failed campaign.
In short, a high level of engagement means that the likers of the brand are really involved with the brand. They are the brand’s ambassadors, doing free promotion for the brand among their Facebook friends. Further reading, available here.
- Market perception – The previous two metrics can be extracted directly from Facebook. But another way to measure the success of a Facebook strategy is to use external tools or indicators. For example, PepsiCo Romania measured the “Media awareness” and “Brand I love” indicators to assess the success of their Facebook strategy. During the campaign, they noticed that their evolution was highly correlated with Facebook campaigns.
Another tool that can be used is Klout. A new darling of the social media marketing, Klout allows the evaluation of the influence a certain person/brand has on the social network. Monitoring all relevant networks, it calculates a coefficient which varies depending on the level of penetration the brand’s content has on the biggest influencers by assessing the comments, shares and re-tweets of the marketing message. This is highly volatile (any misstep will result in a significant decrease of the score), but it might be a good way of assessing the success of a marketing strategy. Learn more here and here.
- Direct effect on revenue – Estimating the direct correlation between the investment in social marketing and the increase in revenue is again a difficult endeavor. There are too many parameters to take into account, such as parallel offline campaigns (TV, radio and so on), missteps of the competition, or other external events that are difficult to predict or evaluate. But if the brand is actually selling products online, it might be possible to link the effects of a successful social marketing campaign with a real increase in sales by studying the referral effect of a Facebook share or like. According to an Eventbrite study in 2010, each share that a Facebook user does on one of the company’s offers results in $2.52 additional sales. ChompOn, a GroupOn kind of company, has estimated that a share generates an additional $14 in sales while a like generates $8. If this is the case, calculating ROI becomes very easy. Also, the above mentioned use cases prove that it makes sense to try an F-commerce strategy on Facebook. For additional reading, you may find this blog and this article useful.
As with offline marketing, measuring success is the holy grail of social media marketing. Have you invested too much or too little? Is it worth it? How to find out? I have proposed several ways of measuring success, each with its own set of pros and cons. I think that the measurement of success is important but not as important as actually joining the social stream. Thus, a better way of looking at the problem is to ask yourself: How much will I lose if I do not do it? What is the competition doing right now? The answer could be much simpler in this case.
Costin Genescu, Product ManagerTags:Facebook Marketing, Monetize Facebook, SMM, Social Media Marketing, Social Media ROI