Elisabeth Bitsch-Christensen discusses the importance of demonstrating return on investment (ROI) for social media initiatives. She provides examples of value drivers and metrics that can be used to quantify cost savings and revenue benefits. Key benefits mentioned include increased marketing productivity, reduced customer acquisition costs, improved brand monitoring and customer service. The document emphasizes starting ROI conversations early and basing discussions on business needs and measurable outcomes.
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The ROI of Social Media - Show me the money presented at Sweden Social Web Camp 2013
1. Show me the money
Selling the ROI of Social Media
Elisabeth Bitsch-Christensen
Marketing Manager Nordics
@echristensen42
2. There is only one boss.
The customer. And he
can fire everybody in
the company from the
chairman on down,
simply by spending his
money somewhere
else.
Sam Walton
3. Why is ROI important?
What is ROI?
Understanding the value drivers
Happy to show you a few highlights
4. The New Marketing Mix
Paid Owned Earned
TV Ads Free InkDirect Mail
ConversationsContentDigital & Social Ads
5. You Need a Social Marketing Roadmap
Understand
Your Customer
150MM Brand
Conversations
Daily
Content
Marketing
35% of CMOs
overwhelmed
creating fresh
content
Target and
Optimize Social Ads
+1.2B people on
Facebook and Twitter
Drive Business
Results
55% of CMOs
find it hard to link
social to sales
Sources: Twitter
Chief Marketer 2012 Social Marketing Study
IBM from stretched to strengthened
6. You Need a Social Marketing Roadmap
Listen
Publish
Advertise
CRM
7. Decentralized
Organized
Hub & Spoke
Optimized
No clear owner
Social âbubbles upâ
One team runs
Social presences
Cross-functional team
Global presence
Center of Excellence
Multiple global
presences
Scaling Social
8. Start the ROI Conversation Early
Actively talk about ROI
Donât deflect or âminimizeâ
ROI questions
Donât ignore the ROI
elephant in the room
9. Whatâs the value of social media?
I need to quantify the potential impact on revenueâŠ
Weâre not sure we can affordâŠ
I need to show the value of this technology to my superiorsâŠ
I need support to get buy-in for this solutionâŠ
Whatâs the return look like for our business?
What can you tell me about uplifts seen from existing customers?
Do you have any research (external/internal) that prove the valueâŠ
Whatâs the expected payback period?
Do you hear any of the following:
Does your company have a social media
strategy?
10. Success In Social Marketing
+22%
Decrease in
Customer
Service Costs
Competitive
Intelligence
Product
Research/
DevelopmentSocial Lead
Volume
+30%
Average Percentage Improvements Reported by Customers
Source: Salesforce Marketing Cloud CSM Customer Study
+32%
+47%
+37%
Campaign
Effectiveness
Brand
Monitoring
+59%
11. What ROI do companies expect from technology?
Source: Gartnerâs CFOs Top Imperatives 2013
Weighted Average: 16%
12. ROI is a Simple Formula...
Benefits
ROI =
Cost
Cost
-
13. Revenue:
Make A Buck
Cost Savings:
Save A Buck
âŠWith Benefits Falling Into 2 Categories
Heavily Influenced by:
- Campaign effectiveness
- Social strategy
- Content quality & relevance
- Efficiency through technology
- Optimization of paid advertising
- Cost of replacement technology
14. Cost Savings
Productivity increases in:
App Deployment
Reporting & Analytics
Listening and Publishing
Social Customer Service
Crisis Management
Product Development/R&D
Free social Impressions and
Clicks
There are many âValue Driversâ in each bucket
Revenue
Direct & In-Direct Social
Sales
Lead Generation
Improved Customer
Retention
Optimized performance of
Social Ads
Drives The Most Benefit
15. Base Your ROI Discussions on Business Need
Productivity
Gains
Customer
Satisfaction
Customer
Retention
Crisis
Avoidance
Product
Development
R&D
Media
Efficiency
Social Sales
Leads
Revenue Cost Savings
16. Listen: Use Cases & Value Drivers
Social Brand
Monitoring
Community
Engagement
Social
Customer
Care
Social Sales &
Lead Generation
3
4
1
2
Value
Drivers
Social Impact
Measures
Business
Metrics
Improved Social Reporting &
Analytics
Improved Product Development /
R&D
Time spent on reporting (-)
Product market research costs (-)
Customer focus group costs (-)
- Competitive intelligence
- Market Research
Marketing Overhead Costs (-)
Increased Marketing Productivity
(+)
Improved Community
Management
Reduced response time when
PR crises occur
Improve information flow and
response capability between
public comments on social and
business teams
Product market research costs (-)
- Competitive intelligence
- Market Research
Time spent on Community Mgmt(-
)
- Coordinating social activity
- Audience segmentation
- Influencer engagement &
marketing
Marketing Overhead Costs (-)
Reduced Customer Churn (-)
Increased Profits (+)
Improved Social Customer
Service
Reduced Risk of Social Crises
Improved Customer Retention
Rate of response to company and
product questions social (+)
Social mentions monitored (+)
Call center volume (-)
Reduced Customer Churn (-)
Increased customer satisfaction (+)
Increased Profits (+)
Increased service agent productivity
(+)
Increased Socially-Influenced
Sales
Increased Lead Generation
% of inbound site traffic from
social sources (+)
Redemption rate of social
coupons/offers (+)
Increased marketing productivity (+)
Increased sales force productivity
(+)
Decrease cost of customer
acquisition (-)
17. Listen Play 1: Social Brand Monitoring
Reduced time spent reporting
Reduced probability of PR
crisis attributable to social post
Reduced cost of market
research
+56%
+10%
+10%
Improve performance of marketing, sales and services by adapting your strategies and
tactics in real-time. Reduce marketing overhead costs associated with reporting about your
brands, products, industry, and competition.
18. Listen Play 2: Community Engagement
Reduced time to collect social
activity for response
Time saved to segment
influencers and detractors
Decreased time to segment by
sentiment
Reduced time to gather and
analyze competitive intelligence
+40%
+40%
+40%
+40%
Reducing cost of external collaboration with your communities. Build networks of influential
brand advocates and maintain an active role in defining your brand. Reduce time spent by
community engagement team identifying relevant conversations, responding to them or routing
them to appropriate business teams. Increase marketing productivity and improve profitability.
19. Listen Play 3: Social Customer Care
Improve customer satisfaction. Reduce attrition rate and call volumes. Increase service
agent productivity. Increase profitability across your business by demonstrating commitment
to your customers publicly on social media.
Decrease in questions on social
and traditional media sites that
go unanswered
Increase in customer retention
+67%
+1%
20. Listen Play 4: Social Sales & Lead Gen
Increase in annual online leads
and offline trade show leads
Improvement in conversion rate
Increase in revenue per lead
+18%
+15%
+20%
Drive revenue by acquiring net new customers by listening and engaging at point of need.
Increase marketing effectiveness by bringing marketing and sales operations closer. Decrease
cost of customer acquisition by leveraging increases in brand and campaign awareness.
21. Publish: Use Cases & Value Drivers
Brand
Awareness &
Growth
Drive Behavior
& Conversions
Deploy & Manage
Social Presences
at Scale
3
1
2
Value
Drivers
Social Impact
Measures
Business
Metrics
Conversion from social
offers
Socially Influenced Sales
Lead Generation
Revenue from Social
Sharing
Redemption rate of
social coupons / offers
(+)
% of inbound site traffic
from social sources (+)
Increase marketing
productivity (+)
Decrease cost of customer
acquisition (-)
Increased profits (+)
Social Application
Deployment:
Social Reporting &
Analytics
Reduced agency costs
(-)
Reduced internal
expense for shared
creative & production
services (-)
Increase marketing
productivity (+)
Decrease cost of customer
acquisition (-)
Increase profits (+)
Reduce Administrative
Overhead (-)
Fan and follower growth
Earned Media from Social
Sharing
Redemption rate of
social coupons / offers
(+)
% of inbound site traffic
from social sources (+)
Decrease cost of customer
acquisition (-)
Increased marketing
productivity (+)
Reduce Administrative
Overhead (-)
22. Reduced expense creating /
managing social presences
Reduced marketing employee
time spent reporting
Reduced time spent with
outside creative services
Leverage lower cost per hour
for internal employee time
+50%
+56%
$200
/ hr
$60
/ hr
Publish Play 1: Deploying & Managing
Maintain brand consistency across global markets and/or affiliates, repurpose effective content
strategies & key learnings to drive efficiency and performance. Decrease costs of customer
acquisition, increase marketing productivity by focusing activity on productive campaign execution.
23. Publish Play 2: Behavior and Conversions
Redemption rate increase from
social offers
Conversion uplift from social CTAs
Increase in average order value
+27%
+15%
+20%
Generate high value earned media and word of mouth at scale. Build a network of advocates
who are an asset to the company. Decrease costs of your customer acquisition by building
brand awareness across social. Increase marketing productivity by expanding brand reach.
24. Publish Play 3: Brand Awareness & Growth
Increase in social posts
Uplift in engagement per post
Conversions per engagement
Average value per sale from
social sources
+49%
+47%
+0.05%
$50
Increase referral traffic, drive form completes, leads and other conversation types, or online sales.
Decrease costs of your customer acquisition, increase marketing campaign productivity and
business profitability.
25. Advertise: Key Use Cases
Acquire Fans
& Followers
Drive Leads and
Direct Response
Promote Great
Social Content
3
1
2
Value
Drivers
Social Impact
Measures
Business
Metrics
Earned Media from Social
Sharing
Fan and follower growth
Redemption rate of
social coupons/offers (+)
% of inbound site traffic
from social sources (+)
Decrease cost of customer
acquisition (-)
Increased marketing
productivity (+)
Direct Social Sales
Socially Influenced Sales
Lead Generation
Revenue from Social
Sharing
Redemption rate of
social coupons / offers
(+)
% of inbound site traffic
from social sources (+)
Increase marketing
productivity (+)
Decrease cost of customer
acquisition (-)
Increased profits (+)
Earned Media from Social
Sharing
Fan and follower growth
Fan and follower retention
% of inbound site traffic
from social sources (+)
Decrease cost of customer
acquisition (-)
Increased marketing
productivity (+)
26. Advertise: Drive Campaign Effectiveness
Reduce fan & follower acquisition cost. Increase marketing productivity through multi-ad
optimization. Increase marketing team productivity by reducing time to manage multiple ad
campaigns.
Reduced cost per action
Reduced third party advertising
costs
Decreased time spent reporting
Increased marketing campaign
effectiveness
+25%
+7%
+19%
+56%
27. Process for Building a Business CaseâŠ
Identify primary
value drivers
Source
baseline
metrics
Model
efficiencies &
improvements
Validate
assumptions &
iterate model
Prepare and
present
complete
assessment
28. ROI of Buddy Media for JetBlue
Interviewed JetBlue promotions team, with
6 active Buddy Media users
Key benefits for JetBlue are:
- Reduced creative services costs
through bringing microsite and
sweepstakes management in house
- Increased marketing productivity
through analytics and conversation
management
- Greater visibility into results & better
promotion execution through easy to
use application
29. ROI of Radian6 for Cisco
Interviewed Cisco Corporate Social Media
team: supports 240 Radian6 users
Key benefits for Cisco are:
- More focused use of outside agencies
- Increased staff productivity through
broad, multiuser (240) listening and
engagement technology + SocialHub
- Reduced investment in survey research
- Improved partner management
- Increased profits