A few days ago, we had a round table soup evening to follow up the seminar Digital Kommunikation och Trender from Handelskammardagarna. We talked about it on Twitter and encouraged people to ask questions. Joel Börjesson sent us the following tweet:
We had a short tweet exchange about the matter, which continued in a chat discussion in the evening. To summarize the whole discussion including Twitter, it went something like this:
Joel: Just for fun, since I couldn’t be there: What are your favorite methods of analyzing ROI and metrics on your Social Media platforms?
Björn: Social Media is so much more personal that it is hard to measure Return On Investment. While I’m sure you somehow measure ROI in personal relationships, do you really do it with figures and graphs?
Joel: All social media is measurable. Look at it this way. Social media is really much like any lunch you might have with a client. Say you buy that client or partner lunch, that costs you $20, but what you might get from that lunch, might be much more valuable than the lunch you just bought your client. Say for example that the conversation during the lunch between you and client result in a new possibility of doing business or a prolonged contract. Now there suddenly you have a new business plan or a prolonged contract, paying back that investment of $20 ten thousand fold.
Björn: But what if you don’t get that contract? It’s still worth something, right? How can you measure that?
Joel: Lunch just like Social media is not about the investment you do in the actual lunch or the social media implementation but what you do with the conversation or the platform that you invest in. The more conversations you have and the more time you invest into social media, the more return you will see. Social media and lunches are not about instantly crunching numbers, but more about creating long term dialogues, discussions and collaborations. By just a small investment such as a lunch or a social media tool (which you often can get for free), you can start building long term dialogues resulting in return of investments in a not too far away future. With better understanding between companies as well as consumers through dialogue, greater business decision and greater return on investments will be made.
Björn: Great points, but the question still stands: Can you really put that into numbers? Obviously, a Facebook page filled with positive comments is a great thing, but how do you decide how much a comment, blog post or tweet is worth?
Joel: While there is value to simply measuring the amount of tweets and comments you get, the real value lies in what KIND of input you receive. To turn it around, you can think about how much you would have lost if you did not receive certain messages. If you start distributing a faulty product, some people will notice it, and the first place to complain today is in social media. Had you not been listening to what is being said online, the damage, both economically and reputation wise would have been much more severe. An example of this is the Kryptonite story, where someone realized that you could pick a bike lock in less than ten seconds with a pen, recorded it and put it on YouTube.
Björn: Super! So a way to measure the value of a good dialogue online could actually be to imagine the economic loss of missing out on key information to be found there. Awesome! Thank you Joel for a great discussion and input on this matter! High5!
A short note on the quote: although Albert Einstein is usually credited as the author, he is not, according to the blog Quote Investigator.