Is Your Social Network Worth It?

The rise of social media has been nothing short of phenomenal. It has brought about a paradigm-shift in the way people consume online media. Corporations worldwide are bemused by the present scope of social media, and the predictions about its future don’t help much in easing their anxieties. With social networks on Facebook, Twitter, LinkedIn, etc. growing stronger by the millions, marketers see social media as a lucrative channel to market their products and services and covet longingly for those Fans & Followers present “out there”.

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But when the social marketer’s fantasy confronts reality, questions arise about the good ol’ ROI. Marketers these days are invariably held answerable for the financial ramifications of their decisions. The rationale behind it is quite elementary – it’s impossible today for companies to survive without having enough metrics, objectives, analytics data, and actionable intelligence about business performance. Hence, there’s a vital need for the marketers to understand the nuances of social media marketing (SMM) metrics.

In the old world of communicating, marketers could communicate with their prospects only in a broadcast-style, one way, using traditional mass media channels. But, in the new world of communicating, spawned by social media, the communication strategy has a built-in participatory component that permits the prospects to not only receive information but also to participate in the actual creation and distribution of content. Hence, fundamental to the success of a SMM campaign is building a targeted following on a social network, because even if you rarely make sales on social media, you yield great financial value in the long run by building trust, reputation, human value, influence and loyal customers.

It’s important for the marketer, right at the outset, to fully comprehend that SMM isn’t alien from marketing; identifying measurable goals and formulating well-planned strategies is highly relevant to both. And since it is just another form of ‘media’, you use the same yardstick to determine its profitability as for other media.

So, the first thing to do is to determine your goal or the business outcome that you desire out of social media marketing, because the metrics you choose to gauge your performance would depend entirely on that cherished goal of yours. One may be interested in tracking how many people are sharing one’s website, or a particular social media campaign, or maybe just trends related to a specific online phenomenon. The requisite tools and focus for each are quite different from the other.

The main broad types of social media are – social networking (Facebook, LinkedIn), Blogging (WordPress, Tumblr), Microblogging (Twitter), Bookmarking (Del.icio.us, StumbleUpon, Digg) and Media Sharing (YouTube, Flickr). To track performance on any of these platforms, the main goals marketers must commit to memory are – raising revenue, lowering costs and increasing customer satisfaction. Some key SMM metrics that are generally used to track SMM campaigns are, 

• Unique Visitors (individuals or browsers that have been served unique content)

• Page Views (actual viewing of the web-page by the user)
• Membership and Active Network Size (no. of fans, followers, etc. who regularly interact with your content)
• Engagement Duration (how much time members spend on interacting with your content)
• Bounce (number of visitors coming to your landing page from SM sites, but quickly leaving after that)
• Return Visits (no. of times a user returns to your site)
• Activity Ratio (ratio of active members to total membership)
• Virality (your content being re-shared by the members and their networks)
• Conversions (members converting into sales, subscriptions, etc.)

These metrics must also be supplemented by noting down the milestones achieved in your SMM plan, to keep track of your efforts. Using complex metrics like ‘multiple moving averages’ can further show the periodic trends, thereby providing you with a holistic view of the health of your social network.

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Even though marketers understand that the best campaigns are the ones that can be measured, perfectly measuring SMM campaigns is still an elusive dream. SMM is totally about relations between people, and what the marketers sometimes tend to forget is that customers are but people only. Hence, in this new world of social media the focus has to be on drawing the attention of your customers, making sure they like you and interact with you, which ultimately motivates them to buy rather than you channelizing all your energies on selling.

Social media marketing is here to shatter the conventional wisdom about the relationship between the marketer and the prospect, but the final decision on whether a social network is worth having or not would depend on meticulous planning and careful use of suitable social media marketing metrics.

© Jayant Rana, 2012-Present