Often, our industry can appear complicated, and yearns for simplicity. One such technique to glean simplicity is to develop frameworks which the corporate social strategist can then apply to achieve their business goals. I’ve been working on this “ROI Pyramid” framework for a few months now, and am ready to share in greater detail than on my keynote at LeWeb (slides and video) where I introduced this to the public for the first time.
Measurement, the Number One Priority, Is Important to Social Business
In our recent research report on the buyer of social business, (read research report: Career Path of the Corporate Social Strategist) we learned that measurement is one of the most important aspects to social business, in fact the top priority stated by 48% of corporations was “Creating ROI Measurements” for internal programs, (see data).
Yet, Measuring Social Media Is Challenging
While we learned that measurement is the key, we found (see data in slide 20) that 65% of corporations are using engagement data as the top used metric, with only 22% using product revenue as a metric.
Apply the Social Media “ROI Pyramid” In Your Measurement Strategy
|Who it’s for||How to generate||What no one tells you|
|Business Metrics||Executives, and everyone else who supports them, which of course, is everyone.||This is a roll up formula of Social Media Analytics. Use tracking software or referral traffic to infer how customer engagement moves down marketing funnel. Existing CSAT methods should also incorporate social channels, and measure a sample of sentiment from customer communities. Cost reduction is a formula based on reduced costs and time in these lower-cost channels.||The pyramid is smaller at top as their are less metrics to give to busy executives. There’s really only three: increased top line, reputation, and reduced costs. Compare these lower cost channel to existing marketing efforts to get additional budget, and benchmark over time.|
|Social Media Analytics||The Corporate Social Strategist and the internal stakeholders and internal clients (leaders of the ‘spokes’ in the hub and spoke model)||This is a formula based on Engagement Data (the tier below), there are no industry standards, so pick one and benchmark over time||We’ve identified there are 16 analytics, but there are many more in existence, you’ll have to create these formulas on your own|
|Engagement Data||Those who are deploying social media: community managers, developers, designers, agency partners, IT.||This data is already created by many social tools, and a variety of analytics are already available to gather this info from brand monitoring to the analytics provided by Facebook and Twitter and others. Don’t forget to include traditional web analytics. Read our research report on Social Marketing Analytics to learn about the existing formulas.||Don’t ever give this to executives until you’ve first given them business metrics or expect many months focused on ‘more followers’ without a business purpose.|
I look forward to hearing how you implement this framework in your measurement efforts, let’s open up the discussion in the comments below, please share this with your teams, agencies, partners, and staff. Thanks to Christine Tran and Asha for design help. Feel free to use these slides, flickr images, just provide attribution to Altimeter Group.
Social CRM Needed To Make Sense of Consumer Data.
Social data is overwhelming. More customers, buyers, and consumers are creating content everywhere they go. Companies cannot scale to match this in a 1:1 basis, and most companies are in early phases of the 8 Stages of Listening. Earlier this year, I made clear investments in researching the Social CRM space and Mobile+Social space (report forthcoming), it’s clear that Social CRM is starting to get wind under it’s wings, and mobile/social is certainly happening at consumer level. So what do I see happening next? Two trends, social analytics intelligence, and social business value networks, which I’ll discuss at a later time.
Social Analytics and Social Insights are Components of the Social CRM Suite.
You can see how we indicated in the toolset there are use cases in Social Marketing Insights, Social Sales Insights, Social Support Insights, Innovations Insights, Collaboration Insights. If you can successfully derive insights from these 5 use cases, you’ll be able to complete the far right use cases and provide a VIP experience to customers –before they’ve ever entered your store or registered to your website.
Matrix: Brand Monitoring, Social Analytics, Social Insights
|Category||Description and Example||Current State||What no one tells you|
|Brand Monitoring||Aware. Simple aggregation and reporting –without any real intelligence. These technologies scrape and aggregate what’s being discussed by a topic, channel, or group and derive alerts and workflows.||Commodity technology. I started a list in 2006, yet now there are over 145 indexed by E&Y employees. These technologies do not provide intelligence, or predictive behavior modeling.||The smart brand monitoring companies have already started their integration plans. They don’t want to end up being trilobites and have become part of a larger system: Recent acquisitions include Scoutlabs+Lithium(community), Filtrbox+Jive(Community), Techrigy+Alterian(WCM) and others.|
|Social Analytics||Intelligent. Derive meaning what social data means. These companies provide intelligence and answer “Why are 500 people a week tweeting about goat milk?” Companies who derive intelligence from social data like Crowd Factory, Crimson Hexagon.||Emerging features are coming around. These tools help true data analysts derive meaning from patterns, and how it influences large scale commerce.||This space is still evolving, and expect that the business intelligence software vendors like IBM Cognos, SAS, Qlikview, Oracle, and beyond to start acquiring data streams in the social space and coupling with their engines within the next 12-18 months. Even analyst Esteban Kolsky agrees|
|Social Insights||Predictive. These companies can predict what consumers will do based upon social data. I’ve seen early examples from community platform Lithium who’s able to predict within 45 minutes if a community will be successful based on comparing to historical data, but for the most part, that’s limited to community data –not the whole social web.||Not here, yet. Right now, systems are just aggregating content to make meaning out of it, yet there’s no clear set of companies that are able to truly provide predictive recommendations.||Look for companies who have data across a value network. What’s that? Data in multiple companies from manufactured, supplier, retailer, to consumer. Expect companies like Bazaarvoice to be able to yield insights as they collect data from multiple manufactures like HP, Dell and are used on retailer sites like BestBuy|
Corporate Social Strategists Should Evolve Buying Criteria Now.
The social media landscape is noisy, and brand monitoring features aren’t sufficient for brands to be actionable –only reactive. As a result expect:
Love to hear your perspective as companies seek to derive meaning –then predict customer behavior using social data.