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Return on investment from social media?

Step forward, please, the social media alchemist who has struck gold…

The leading voices in social media practice and debate are certainly giving it their best shot: Brian Solis’ recent guest post on Mashable paints a daunting picture of senior executives’ views on ROI from social media, including the bar chart below lifted from a study by Bazaarvoice and the CMO Club.

In short, the marketing decision makers remain unconvinced; so, if selling social media is the way you’re aiming to pay for dinner tonight, be prepared for a light salad rather than roast beef.

Solis suggests that measuring social media ROI in 2010 will hinge on real business metrics, such as revenue, rather than the nebulous numbers offered by volumes of followers on Twitter.

Though it’s been around for a while, Oliver Blanchard’s take on the ROI question (presentation below) still hits the spot, although the influence of other elements in the marketing mix make it difficult to evaluate the effect of social media in isolation.

Olivier Blanchard Basics Of Social Media Roi

View more presentations from Olivier Blanchard.

In our experience as a business using social media for our own purposes, as well as advising clients on theirs, there is a significant investment of time in order to make it work. Equally, the definition of a “return” has not been limited to pounds and pence, though that is the ultimate objective.

So what has been our return from social media? In its purest, measurable form of generating income, we have developed an ongoing relationship with a blue chip company that began with an exchange of views on this blog. But there have been other returns too, that oil the wheels towards our destination.

This has included using social networks to develop new contacts in a range of fields whose knowledge we have been able to call upon when pitching for new business. Through listening to networks such as LinkedIn, we’ve been asked to quote for work, opened doors with decision makers where they otherwise may have remained shut and we’ve fostered true partnerships with our suppliers by providing recommendations and referring them to opportunities spotted online. Monitoring Twitter has helped us to protect and enhance client reputation, especially when influential people on the network have a grievance.

Granted, none of this is a guarantee of instant, financial success. But would we rather have it or not have it? In tough times (and, let’s face it, one measly tenth of a percentage point growth doesn’t make for a recovery) every tool in the new business box has to be sharpened, and social media is now one of them.

To borrow from Solis again, “Defining the “R” in ROI is where we need to focus, as it relates to our business goals and performance indicators specifically”.

In business, the “R” is beefing up the bottom line. But there’s more than one way of getting there and building a presence within social media can mean you leveraging a little help from your friends.

Recent blog posts on social media here at PR Media Blog seem to have had people reaching for the boxing gloves.

Whether it be the use of social media in politics or in business, there seems to be sharp divide between those who think it’s the earthly paradise of Shangri-la and those who feel, like in the old days of the witch hunt, it deserves to be strapped in the ducking stool to see if it floats or sinks.

Not wishing to see people fall out about it, I did the conciliatory thing and started an argument on LinkedIn where, naturally, people are known for their reasoned responses.

And it raised some interesting points.   

Simultaneously, another LinkedIn question was asking: “When you run into someone that tells you that Social Media is going to rule the world…what’s your funniest response?”

Social media ruling the world? Be careful what you wish for…

“As 2009 approaches, and the world economy is truly in freefall, what is your secret of success - or survival - for next year?”

 It seemed like a fair question to stick on LinkedIn before the festive bells start jingling and the chestnuts roast on an open fire.

This year has been social media year: as well as developing a serious Twitter problem, finding my way around cocomment and helping to keep this blog bulging like Santa’s sack on Christmas Eve, I’ve found LinkedIn starting to come into its own as a professional online networking community. Not only has it put me back in touch with people -without having to throw food or turn them into zombies, a la Facebook - it’s been a channel for some great ideas sharing.

Following last night’s question, here’s a selection of the best advice to come back so far…

Rob Ewanow: “Eliminating marketing/PR spend is short-sighted…those who continue to market will reap the rewards.”

Mark Shippe: “If you have a good product or service, you will always be busy and in demand.”

Derek Weber: “It is more important than ever to make yourself and your company more visible…this is the time really to go out and try picking up new clients.”

Karthik Mani: “Be visible…communicate your viability in addition to your value proposition.”

Bridgett Gayle: “Find your unique selling point, your special value-added (everyone has one) and lead with that.”

Phil Quimby: “Be indispensable, whether to your employer, or your clients/customers. Works in good times too.”

And, my current favourite has to be:

Chuck Bogardus: “Wait until 20 Jan 2009 when the major media will announce that everything has been fixed.”

That’s like Dallas, when Pam Ewing discovers supposedly-dead husband, Bobby, in the shower. And it was all a dream. 

Unfortunately, there’s nothing dreamy about multi-billion dollar bank bail outs.

Merry Christmas!

With the Western world’s financial system seemingly disintegrating around us, it’s no surprise that the magic formula for business buoyancy - confidence - evaporates.

In tough times it’s natural for businesses to take immediate action . But is it right to shave PR, marketing and communications from the budget? Along with the allocation for training and Belgian chocolate biscuits, marcomms is an easy target. If the late, great Bill Hicks had anything to do with it, we’d all be six feet under.

But in such uncertain times, there is a need for clear and open dialogue. Insightful comments on the topic have been shared on LinkedIn.

How would you justify the marcomms team and budget not being chucked overboard?

Linkedin seemed to be a good place to start a conversation about social media, how well companies are being advised in this arena and how willing they are to participate (having said it actually fits in with their communications strategy, business objectives and all that good stuff).

Some great insights have already been aired. So, what are you waiting for? Join the (online) conversation!

According to analysts, Gartner, social networking sites are not doing it for business. Well, who am I to contradict that global behemoth but - you know what - here goes…

Strategic communications consultant, Merryn Myatt, signed up for Linkedin about a year ago and promptly forgot about it. Latterly, she started to build up her professional network using the site and then needed some input for a project, so posted a question on Linkedin. Not only was the response enormous, but the profile of the people responding very impressive.

So what, you might say? Apart from Merryn getting a host of great material for her work (i.e., content - what web 2.0 should be good for) it shows that business people are online wanting to interact, share knowledge, learn and build contacts. Isn’t that the start of a beautiful (business) relationship?

An interesting insight into online professional networks can be found here with an audio discussion between FT management writer, Adam Jones, and LinkedIn’s Kevin Eyres. LinkedIn positions itself as a professional - as distinct from social - networking community in which business people can build contacts, get expert advice and manage their careers. Strictly no biting zombie applications or virtual sheep being hurled at one another here, methinks.