This post was originally published on WOMMA here.
It comes from Rick Liebling, Head of Global Marketing, reach him on Twitter here: @RickLiebling
Whether you’ve been to one social media conference or 100, you’re sure to have seen a panel talking about ROI – three letters that often strike fear into the hearts of marketers and brand strategists as well as content creators and community managers. Opinions vary on the subject, with plenty of heavyweights such as Olivier Blanchard and Lee Odden providing strong cases for sharpening your ROI approach, while others offer advice with headlines such as Forget Social Media ROI or suggest you look in other directions.
Ultimately, everyone understands the need to measure something. Knowing how much you spent, what you spent it on, and how much it generated in some form of return – ideally but not always necessarily financially – is a key part of business.
But what is often missing from the ROI equation is context. Brands tend to take a myopic view, stating: “We did ‘x,’ and as a result we generated ‘y.’” While we can argue semantics around the appropriate nomenclature (ROI, ROE…) the truth is that measuring the worth of your investment by benchmarking your efforts against your competitors can also provide valuable insights. This Return on Intelligence broadens the definition of ROI to include a comparison of how your efforts are doing against a broad competitive set which could include direct competitors, your industry sector, or brands from other sectors that may also be targeting the same consumer.
Return On Intelligence
Social media provides myriad ways to measure your efforts; vanity metrics such as likes, follows, repins and retweets are the most obvious. But deeper quantitative measures such as length of time spent watching a video, admin response time to comments or localized fan growth can surface revealing insights about a brand’s social media health. Such efforts require an investment, one that can be measured by how it positions the brand against its competitors.
At the surface, an investment in social media customer service reps may be seen as simply a cost-saving exercise over traditional customer service techniques; you’re able to respond to more requests in less time. However, when your response time is measured against that of your competitors, it may be viewed as a service benefit that ultimately leads to new customer acquisition.
In another context, measuring the percentage of consumer @-replies to a brand’s Twitter account may tell you how much direct engagement you are earning. Measuring that against competitors can be correlated to brand affinity when combined with sentiment.
Viewing social media ROI through the lens of competitive intelligence allows brand managers to assess social media through a relevant lens without having to tie it directly to sales or other bottom line metrics. This approach recognizes that information is a valuable form of ‘return’ in and of itself.
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