If I offered you $0.01 to work for a week, but promised to double your pay each week, would you take the job? If you work the math through you will find that by week 28, you would be making over $1 million a week. Started off slow, but the pay-off and long term result is big. You know, social media works the same way, but too many people are looking for the quick sale and looking for an immediate ROI. The wise marketing executives are in it for the long haul and are investing in social media to produce sustainable growth over time. If we look at the economy in the past four years, isn’t long term sustainable growth OK? Heck it is better than OK. Relatively speaking it is great.
And for the reasons above (as well as some great conversations with social media thought leaders), I am abandoning the social media marketing funnel that I have been trumpeting for a good while. It came down to one fundamental reason. The issue of sales. Here is the question – how does social media relate to sales? This is what so many are after when they bring up the question of social media ROI. Well here is the answer … social media increases the probability of sales. It is part of a marketing mix.
It is possible to define social media as a function of sales with extensive evaluation and regression analysis looking at all the marketing mix components and capturing cross media measurement. There are companies like MarketShare, ThinkVine, and SymphonyIRI Group that can do this for you. But in many cases, that is cost prohibitive. For many, they can intuitively accept that social media increases the success of SEO, SEM, paid media ads, as well as the non-digital traditional marketing endeavors. Social media contributions to sales is not immediate and is long term. Therefore it is difficult to measure. So why not simply look at the things that are easier to measure that lead to sales as well as looking at post sales metrics that contribute to customer life cycle value as well as word of mouth marketing.
If we concentrate on the things that lead up to a sale and the things after sale that are easily tracked, is this not an acceptable way to measure success? Is there not a value in looking at ROE (return on engagement) and recognizing that there is a definite value in engaging with your target audience; making them feel like your brand is a part of their life; building a relationships and trust? Does anyone debate that measured success here will lead to an increase in sales. So let’s measure and report on things that can be done quickly, won’t cost a ton to do so, AND ARE RELEVANT.
Take sales out of the equation. I am not saying that there is no sales attribute of/to social media. I am saying it is difficult to measure, if not cost prohibitive. If we take that stance, you should ask how then does social media relate to sales? Answer – it increases the probability of sales. It does this by generating awareness and influencing buying decisions (consideration) before a sale. Social media also increases loyalty and breeds advocates after a sale. So what we are left with is the social media marketing funnel I have previously defined without a sales stage. And if there is no sales stage in the measurement model, we certainly cannot use the funnel. What we are left with is “measuring social media success” as shown in the circular diagram below:
Yes, there can be other things that are measured, but this gives you some concrete examples of how we measure social media success. These four attributes increase the probability of sales and allow us to start measuring social media success.
A couple weeks ago, I recommended “How Social Media Helps Brand Building and Driving Profitable Business.” I suggested it was the intersection of “how customers engage with brands” (called Social Business) and “the way companies conduct profitable business” (called Relationship Enterprise). Relationship Enterprise is the diagram above and for review, Social Business is the way organizations should execute social media and looks like this:
This is also called the “A-Path.”
Now if we bring these two together, we have now defined “Social BrandAction” …
So, yes – it is the end of the social media marketing funnel. This new model represents the true business world of how customers engage with brands, and how brands build value. It also includes a scheme to measure profitable transactions that is easy to execute, not cost prohibitive, and unveils a true degree of success. It is based on return-of-engagement (ROE). ROE has long term ramifications. There are no short term scenarios to make a quick buck. Invest in long term sustainable profitable endeavors. Invest in social media and have realistic expectations and a method to measure your success.
I’ll leave you with a tribute to a great band that called it quits after five decades of awesome music. In the words of R.E.M. – “It is the end of the world as we know it, and I feel fine.” Do you feel fine?
Make It Happen!