Leveraging Social Media for ROI Measurement and Analysis

1. Social Media ROIFebruary 25, 2010 Presented by: James Clark, Co-Founder Room 214

2. American Marketing Association @marketing_power James Clark, Room 214 @jamesoclark @room_214 #AMAReadyTalk

3. Return On Investment Source: Wikipedia

4. Return On Investment The Formula Simplified Return – Investment = ROI More Simplified It’s about $$$$$

5. Tying ROI to Social Media Why Does it Matter? Forrester Research* Projects $3.1 billion annual spend on social media by 2014 * US Interactive Marketing Forecast, 2009 to 2014 What Gets Measured Gets Funded Five Steps to Get B2B Social Media Funded*: Understand the Numbers Develop a Strategy Based on Financial Gains Understand Resources Needed Before Starting Find and Build a Hero Set ROI Metrics and Time Table From the Beginning *Kip Bodnar, SocialMediaB2B.com

6. Measure What?

7. Measurement = Confusion

8. Program Measurement WOMMA Measurement and Metrics Guidebook

9. Program Measurement WOMMA Measurement and Metrics Guidebook

10. Program Measurement WOMMA Measurement and Metrics Guidebook

11. Conversation Volume and Share of Voice Volume = Total Number of Post Share = Total Number of Post Compared to Competitor Analyze by traffic source (blogs, mainstream media, forums, Twitter, social media, comments, YouTube) to look at the media distribution platforms where your message is being carried • The total number of posts on a given brand, product, campaign or topic tracked over a set time period. Start when a campaign launches, or service starts or product is introduced.

12. Conversation Volume and Share of Voice • Online Monitoring Tools • Radian6, - http://www.Radian6.com • Filtrbox – http://www.Filtrbox • Techrigy SM2, http://techrigy.com • Google Alerts, http://google.com/alerts • Resources: • Social Media Monitoring, http://www.socialmediamonitoring.ca/index.html • Monitoring Tool Directory: http://bit.ly/5LCyTf

13. Sentiment & Opinion Analysis Assessment of an author’s tone – whether or not they express a positive or negative opinion about something – within a specific text

14. Sentiment & Opinion Analysis • Sentiment Analysis Metrics and Indicators • Sentiment Volume: The number of positive/negative/neutral consumer opinions expressed about a brand, company or product • Sentiment Ratio: number of +/- opinions expressed divided by the total number of consumer opinions or similar formula • Polarity/Intensity: beyond +/- exp: District 9 was f***ing amazin!, District 9 was a decent Sat night date flick • Qualitative Factors: what do they cite as their reasons? E.g. Comcast is terrible my internet is crawling • Specific Customer Feedback: I wish Netflix had subtitles, Blockbuster is better than Netflix, I wish Netflix would come to Canada • Natural Language Processing • BEWARE – claim to have 80% accuracy – don’t believe the hype • Human Reviewed • Limit the number of posts to review and assign each to a category WOMMA Measurement and Metrics Guidebook, Margaret Francis

15. Opinion Analysis – Actionable Data • Conversation about ACME as an innovative “green” company appears in the Exciting New Technology and Socially Responsible categories, which make up more than one third of content. • Conversation portraying ACME as an Evil Corporate Giant focuses the xxxx indictment. • AMCE’s attempt to impose a surcharge on customers with solar panels fuels Anti-Green conversation • XXXXX conversation contains some discussion of ACME’s attempt to include executive perks in a rate hike, as well as more neutral discussion about routine rate increases • The greatest proportional of user-generated content, much of it from Twitter, appears in Outages and Emergencies. Key Topics of Conversation about ACME Company Other 11% Exciting New Technology 25% Outages & Emergencies 9% Complaints about Rate Hikes 20% Socially Responsible 13% Evil Corporate Giant 10% Anti-Green 11% Analysis Dates 8/15 – 9/17

16. Sentiment & Opinion Analysis Room 214’s Recommended Sentiment and Opinion Analysis Tools Sysomos, http://www.sysomos.com Crimson Hexagon, http://www.crimsonhexagon.com

17. Measurement is Not ROI An increase in sentiment is NOT a financial metric An increase in conversation is NOT a financial metric An increase in positive opinion is NOT a financial metric

18. The Rise of the Statisticians Cohort Analysis Multivariate Regressions Time Series Data Nested Case-Control Marketing Mix Modeling

19. Marketing Mix Modeling Wikipedia: Marketing Mix Modeling

20. What’s the Formula “All formulas are wrong, BUT are they usable?” Ed Halteman, PhD, Survey Design and Analysis

21. Before and After Social Media

22. Baseline Against Financial Targets Before Social Media After Social Media

23. Add In Social Media Measurement

24. Run Correlations • Did the spike in conversations impact total sales volume? • Has the steady uptake in total community members resulted in more sales activity? • Is it content or tactic? • What mix of marketing efforts drove the increase in sales?

25. ROI Techniques – Is There a Correlation? • INCREASING REVENUE EARNED: • Frequency – increasing the number of purchase transactions • Acquisition- increase the number of net new customers • Yield – increasing value of individual purchases w/o sacrificing freq • Acceleration – shortening the time it takes to acquire a customer • REDUCING COSTS: • Customer Acquisition – shifting cost of sales to lower cost channels without sacrificing the customer experience • R&D – expediting R&D time and surfacing new product and feature needs • Institutional Learning and Insights – removing organizational friction and creating synergies between otherwise disparate groups • Customer Service and Support – shifting cost to serve to lower cost channels WOMMA Measurement and Metrics Guidebook

26. Public and Private Communities • Employee Engagement • Marketing and Sales • Deeper customer relationships • Social CRM • Insights from Target Market • Boost SEO • Innovation • Market Engagement • Support

27. Net Promoter Score How likely are you to recommend to a college or friend? Promoters: (score 9-10) are loyal enthusiasts who will keep buying and refer others, fueling growth Passives: (score 7-8) are satisfied but unenthusiastic customers who are vulnerable to competitive offerings Detractors: (score 0-6) are unhappy customers who can damage your brand and impede growth through negative word of mouth Source: Satmetrix

28. ROI Resources Net Promoter Score http://www.netpromoter.com Social Media Today 6 Must Read Posts about the ROI of Social Media http://bit.ly/4E0WqA Mashable How To: Measure Social Media ROI http://mashable.com/2009/10/27/social-media-roi/ SocialSteve Measuring the Value of Social Media http://bit.ly/7jhOfK Wikipedia Marketing Performance Measurement and Management http://en.wikipedia.org/wiki/Marketing_ROI Measurement and Metrics Guidebook http://womma.org/metrics/Metrics-Best-Practice-Guidebook.pdf

29. Breaking the Golden Rule Room 214’s Competitors – Doing Cool Stuff Awesome ROI Presentation Oliver Blanchard Basics of Social Media ROI http://bit.ly/aUHBpP Conversation Impact Ogilvy 360 Digital Influence http://bit.ly/5DWGQc Social Influence Marketing Razorfish Fluent Report: http://bit.ly/7MnurP Customer Experience Programs Statmetrix http://www.statmetrix.com

30. Thank You! James Clark Co-Founder, Room 214 www.Room214.comjclark@room214.com Twitter: @jamesoclarkPhone: 303-444-9214 x100