A recent study by the Lenskold Group has revealed some very interesting insights into the art and science of determining a Return On Investment (ROI) through your social media marketing efforts. It seems that although some improvement has been made on the ability for online marketers to measure the ROI of their social networking presences, it still seems to be a bit more art than science. Although absolute precision in the calculation of social media ROI is still rather evasive, the report does illuminate various key aspects of the experiences of major brand marketers. Only 28% even bother to calculate social media ROI
Of the total of online brand marketers surveyed, the report found that only 28% actually took the steps to calculate ROI or similar profitability metrics, while 36% were happy to just calculate some overall financial metrics and not even try to approach the formulation of a profitability metric. This leaves 36% of all brand marketers who do not try to attempt any of the above activities and simply apply traditional marketing metrics to their social media presences. Unfortunately this last group is truly comparing apples to oranges and whatever results they derive are bound to be inaccurate and essentially inapplicable.
The majority of online marketers are making little or no progress
There also seems to be fairly unsatisfactory progress in the degree that these brand marketers are improving their capabilities to measure the actual financial ROI generated by their investments in social media. A stunning 22% of all marketers stated that they had experienced absolutely no improvement in any way, while 30% stated that they had been able to manage a slight improvement. When we add up these two groups we find that a net majority of all marketers are either standing still or might as well be when it comes to social media ROI calculation progress, and you don’t have to be a C-Suite exec in one of these companies to realize that this is simply unacceptable.
Almost a quarter of brands have no social media presence
At this stage in what is clearly the era of social media it would seem that the number of brands which are utilizing these forms of presences in order to engage their customers in online communication should be at the saturation point, but the opposite is actually the case. Fully 23% of all online marketers of major brand stated that they are not utilizing any form of social media as part of their overall marketing campaigns. Interestingly this percentage is not solely made up of brands which have not yet launched their social media efforts, but includes some element of companies which have maintained a social networking presence and then dropped out for a variety of reasons.
Minor factor in incremental sales
When it comes to the online brand marketers’ abilities to measure the actual tangible outcomes from their social networking presences, the results are rather troublesome as well. 43% of all brands stated that they were able to measure results from engagement or participation quantities, 36% from new names generated, 32% in the total number of prospects or leads generated, 26% through the change in awareness or perceptions, 20% in incremental sales, 19% in ROI, and just 18% in incremental revenue. If there was a traditional advertising medium recommended by an online marketer to the C-Suite which derived just a 20% measurable factor in incremental sales, that marketer would likely soon be looking for another job.
One of the most stunning results from this study is that when online brand marketers were asked whether the need to measure the impact and contribution of their social networking marketing efforts was a high or low priority for them, fully 45% answered that it was indeed a low priority! That’s nearly half of all the online brand marketers operating in social media who are spending their companies’ time, budgets, and resources in the world of social media and they don’t even think it’s important to measure what effect their efforts have on the bottom line! It is definitely a brave new world that has such people in it!
Are you ready for a smarter way to engage with your customers?
Benchmark helps you do email marketing the practical way. Create an ongoing relationship with your subscribers that leads to increased sales and happier customers.