Knowledgeistics

Archive for the ‘Measuring results’ Category

We all know that social media are a great source of market insights. All you have to do is log on, see what people are saying about your brand or product, and act accordingly. When you pay close attention to your customer, you can’t fail. Right?

Wrong. SMMR is like any other research activity – it demands not just data-gathering, but the knowledge to interpret that data correctly. If you take the time to understand your brand, product, and target market well enough, SMMR will return great ROI. On the other hand, if you simply take online commentary at face value, you’re playing Marco Polo in an empty pool.

Take the example of the 2006 film Snakes on a Plane. Early teasers generated a great deal of buzz in social media, with commentators practically salivating over the expected camp extravaganza. The studio went so far as to re-shoot portions of the film to meet (some might say pander to) fan expectations. Despite the huge buzz and apparent addressing of needs uncovered through (crude) SMMR, the film grossed a disappointing $62MM.

Buzz aside, SoaP was probably never going to be a truly great film, in terms of acclaim or revenue. However, it is clear that the studio was badly misled by internet buzz. A better understanding of the dynamics of online conversations and their target market would have prevented this misapprehension.

In contrast, the site Think Geek takes a very sane and profitable approach to integrating online conversations into their product and marketing strategy. Although (or maybe because) Think Geek is a niche retailer, they have exhibited a much better understanding of their target market.

Each year, they feature April fool’s products which are meant only as satire of the merchandise they actually carry. However, sometimes these fictional products strike a chord with their customer base and spark a lot of conversation and outright demand. One year, the “Personal Soundtrack Shirt” created such an outcry and later saw production:

April Fool’s Joke Turned Real
Yep. This unusual shirt was originally a joke product for April Fool’s day. But after your overwhelming positive response and hundreds of e-mails screaming to “make the damn shirt already” we went ahead and made the damn shirt… please enjoy.

While this might seem like an obvious choice – ‘give the people what they want’, it required careful consideration on the part of TG. First, they had to find a way to produce the shirt in appropriate quantitites at a reasonable price. Just as importantly, they had to use knowledge of their customer base to determine what that price could be. They had to estimate propensity to buy, rather than simply exclaim about the desirability of the shirt. They had to whether there was genuine demand, or simply a vocal minority, as in the case of SoaP. TG considered all of these variables and introduced a successful product.

Moral of the story: If you can’t tell the difference between real demand from your target market and loud noises from an unruly mob of bloggers, step away from the keyboard, take a deep breath, and look a bit closer.

One of the hot-button issues in the social media community continues to be whether and how you should use metrics to judge the effectiveness of social media.  This is a critical issue for social media experts (because it is their ticket into companies or up the corporate ladder) and a critical issue for companies, who need to judge an investment in social media in terms of opportunity cost.

I jumped into this hornets’ nest.  Ben Foster argues that social media metrics may delay action and cost your company leadership position in an emerging channel.

What is clear is that the social media community does not lack for metrics that can be applied to social media efforts.  However, what is missing is a discussion on what the right metrics are.

The right place to start is by understanding your company’s goals for social media, starting with the end in mind.  The social media community has a menu of possible and realistic goals for your social media efforts.  If you have already spent a ton of money on social media programs and are just now thinking of how to measure the results, you are behind.  This is how metrics like followers on twitter become germane — because you have come to a point where you need to set metrics that you can achieve.  (Just Google “gain twitter followers” — if twitter followers are the social media currency, this market is seeing hyper-inflation.) It’s comparatively easy for social media experts to create pageviews or followers — that is why they are experts.

One easy method for setting social media metrics: set metrics that are intrinsically valuable for your organization. If you head up a consumer insights department, your metric may be actionable consumer data.  If you are marketing tampons, maybe you want to drive sampling. Your social media metrics should almost always be external to the world of social media — not pageviews or twitter followers, unless your goal really is to increase your brand’s presence among social media experts.

Mashable has a post up discussing Ford’s dominance in the social media space vis-à-vis competitors. The point is that Ford has been massively more successful in creating a social media presence, as measured by:

• Blog mentions
• Videos tagged on YouTube
•  Photos on Flickr

The author is not the only social media expert to use these metrics like these. It’s an understandable temptation – followers, re-tweets, and tags are easy ways to measure progress. However, there isn’t a discussion of why these metrics are valuable to Ford. It’s not clear, after all, that a twitter follower is in any way more likely to buy a new Ford – particularly since a large percentage of these followers are themselves social media experts.

Here are the three most important metrics for social media. If you can’t measure these, and don’t have a line of sight to measuring these, your initiative is in trouble:

1. What did you learn? Understanding your customer or community better is a fantastic goal and one that we fully support. The functionality of social media market research has high value potential, and should be considered a positive ROI investment in the way that focus groups or surveys are generally valued.
2. Who did we reach? If your B2B company has run a successful campaign and generated multiple sales leads, congratulations — you’ve run a successful social media campaign. However, if you have no idea how reaching more targets impacts your top line, it might be time to rethink your strategy. And if you’re having a hard time knowing if you’re reaching customers or just other marketers it is definitely time to rethink the strategy. 
3. What was the ROI? If you are able to measure a direct top-line result of your campaign you’ve solved the paradox of social media marketing. You did it!

As with any initiative, understanding the rules for success is critical. Make sure you agree to them upfront with your social media consultant.