Connecting the Dots Between Business Strategy, Social Media and ROI Measurement

March 29, 2010

Connecting the Dots Between Business Strategy, Social Media and ROI Measurement

This article was written by Bill Palmer, President of Activate Media Group and originally published by Apparal Magazine.

click here to view the article on Apparel Magazine website.

The lady from the 1980's Wendy's commercial had it right all along, "Where's the beef?" We want Internet marketing and social networking to create business value, but approach with healthy skepticism any claims of marketing gold. More practically, we doubt that we have the right mix of budget, time, team resources, or proper metrics in place to truly leverage Web 2.0 for maximum results. We might even dismiss it completely if a meaningful ecommerce sales channel isn't currently a significant profit center.

However, we must reconsider the facts. A recent Nielsen survey showing that 82 percent of people first use search engines to research and find brands before purchase and 89 percent trust peer reviews and ratings over company ads. Traditional outbound marketing is largely broken. Maybe it's time to reconsider the approach to the overall proverbial customer conversation. Think magnet rather than bullhorn.

Social media is not a fad

Change can be difficult and business is tight, but your instincts and mounting evidence tell you that figuring out the right programs for social media and web 2.0 needs to be a top priority. Forget the buzzwords and the latest tools; for many companies, sustainable competitive advantage or extinction hangs in the balance.

Executives today are realizing that social media is not a fad or yet another marketing channel, but a new inbound marketing and public relations approach to filling the top of the sales funnel with new customers and responding to those customers faster, with greater transparency, and garnering greater loyalty en route.

Social media marketing is just that: marketing. Social media online communities such as Facebook, Twitter, and Youtube are merely "touch-points" whereby you can effectively convert conversations into leads, sales and quality improvements with remarkable content and compelling calls to action.

Lately, you might have heard that this is the year of "social media ROI." This is not necessarily true for you and me. Maybe somebody dropped the ball at some point and let you down. If you think that social media has been a waste of time for your business, it probably has been … so far. The business case and marketing plan needs help.

Forget the tools and tactics for a second and take a fresh look at the strategy as part of an integrated strategic marketing plan. So much of the discussion around proving the ROI of social media seems to be about proving the business value of the tools or a specific site. This entire argument is displaced. It isn't about the tools. It is about the brand strategy. It's about the company's core value propositions and how that translates into growing sales and customer loyalty. The tools and tactics follow naturally from this position once the core is remembered, unlocked and activated.

Seeking measurable results

In 2010, executives are demanding budget scrutiny and real results from every expenditure. Business leaders require clarity in a time of abundant options and scarcity of experience; and rightly so. As an internet marketing consultant, I report to executives who have no desire to measure intangible credos rooted in transparency and authenticity. In the end, they simply want to optimize their return on investment by associating all marketing programs with real-world business performance metrics. Bottom line, they want measurable results -- "beef" from social media and hold the "BS."

To accomplish this, we need clear business goals and meaningful metrics based on industry best practices that generate a repeatable "pattern" for success. A one-of-a-kind dress can be beautiful, but not worth much in terms of overall revenue if it can't be duplicated.

One might think this approach a common sense no-brainer. However, elusiveness continues to prevail. According to a 2009 Mzinga & Babson executive study, more than 80 percent of professionals do not measure ROI for their company's social media programs. Granted, social metrics and their measurement techniques are relatively new, and this might account for the lag in tracking.

However, I believe this is primarily due to the process and state of how these projects are initiated and planned. Social media endeavors are usually still funded as pilot programs to steer the brand toward perceived relevance in the hopes that they demonstrate momentum and materialize rewards. Budgets are often borrowed from other divisions to fund the teams and programs led by internal champions who effectively make the case for experimentation. Where that money goes and from where it's borrowed varies by department and by company.

How the results are measured and improved upon are often a political afterthought. We all know what happens when we fail to plan – we plan to fail.

Developing a strategic social campaign

Nonetheless, this is a huge opportunity for advantage to companies who are learning to conduct social campaigns the right way - strategically planed, measured and monitored social media campaigns. Given social media's digital nature, uncovering comprehensive data to measure and track performance is easier and more real-time than ever before. Google Analytics, Omniture, Radian6 and Visible Technologies all have outstanding capabilities for tracking these performance indicators down to the nth degree of detail with actionable tools baked right in.

Optimizing your website, press releases and content distribution for maximum search, social and blog visibility to get found by more customers is also easy to accomplish on platforms such as Hubspot and Marketwire. Much of the information and tools are free, low-subscription-based, or open source. Therefore, the cost is in hiring and managing the right team. This can also be done by certified experts at low agency rates without overhead or contract risk.

This year social media graduates from experimentation to strategic implementation with direct ties to specific measurable performance indicators. Smart CMOs now require a connection between social media and P&L business goals.

My internet marketing agency conducted an analysis that looked at more than 100 case studies as well as an in-depth executive survey from MarketingSherpa involving more thatn 2,000+ marketers to identify the following best practices in measuring social media for the primary business goals of increasing revenue and reducing costs.

Each of these 11 best-of-breed metrics is placed in the context of the performance indicator it gauges (such as authority, attention or effectiveness):

When we truly grasp the ability to define action and measure it, we can expand the impact of new media beyond the P&L. We can adapt business processes, inspire ingenuity, and more effectively compete for the future of the fashion and apparel business.

Tags: apparel magazine , PR , public relations , social media , web 2.0

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Activate to Address Secrets of Social Media in Keynote Speach at Apparel Executive Forum

April 29, 2009

Mark your calendar for the 9th Annual Apparel Executive Forum – "Maximizing Performance in a New Apparel Environment."

Our new format for 2009 includes hands-on executive workshops offering high-value, results-oriented strategic and tactical information. Watch for details!

This invitation-only event delivers a unique high-level networking and thought leadership experience to apparel, brand and retail executives, providing targeted and highly relevant industry intelligence designed to improve decision making.

PLUS, Compelling Keynotes:
Moving Beyond the Data to Target New Growth Opportunities, presented by Marshal Cohen, Chief Industry Analyst, The NPD Group Inc.

Unveiling the Secrets of Social Media for the Fashion Industry, presented by Bill Palmer, Lead Brand Architect, Activate Media Group
Early bird discount registration fee of $595 now available until July 24!

When registering, enter "AEF595" in the promo code box to receive your early bird registration rate. If you have any questions or would like to register please call Jaime Palladino at (973)-588-4011 or email him at jpalladino@edgellmail.com.

Visit us at www.apparelmag.com