6 Essential Rules to Prove Social Media ROI to Your CEO
Tuesday
May 26, 2009
The blogosphere and Twittersphere have been buzzing this past week over a series of blog posts by Oliver Blanchard on his blog, The BrandBuilder, discussing how to communicate social media ROI to skeptical executives.
The posts sparked dozens of comments and hundreds of Tweets from social media aficionados that split between those who castigated Olivier for daring to introduce crass mercantile interests into the pristine world of social media and those who recognize the business realities involved with securing investment and executive support and need practical guidance to pitch their social media plans.
Olivier was precisely correct when he wrote that executives need to hear how any social media plan will generate a tangible and measurable return on their investment. These executives are responsible for dispensing a finite amount of corporate resources among departments. It is practical, desirable and reasonable that they dispense investment dollars to those projects that will advance the company’s financial position the farthest. That’s reality. Now how do you deal with it?
Once you understand their agenda – maximizing the return on their finite investment dollars – you can frame your social media plans effectively, in language that is compelling and convincing.
Rule #1: do not talk about Twitter followers, the number of retweets last month or the number of times a Fan Page was shared on Facebook. They don’t understand and they don’t care. Zip it until next month’s local SMC meeting.
Rule #2: Speak in language that they understand: Process, Plan, Cost and Return. CEO’s will want to understand the SM process and know that you have a precise plan to execute. By the way, it must be written, or it’s not really a plan.
Rule #3: Do not tell the CEO that the cost of your social media plan is zero or you’ll lose all credibility. Although Twitter, Facebook, LinkedIn and WordPress do not charge their users, their cost is not zero. Their actual cost must include the human costs of participation, engagement, content development and management. How many employees will be involved? At what level? How many hours per day? Per week? Although the company doesn’t write a separate check for social media costs, they are paying for participation, and the total cost may be significant.
Rule #4: Focus on Quantitative, not Qualitative returns. Qualitative returns include the impact of your participation on your company’s reputation and the value of extended online conversations in relationship building. The CEO doesn’t care. I know you do, and I know your CEO should, but that’s not how he measures success. He wants Quantitative metrics. How many new customers did your efforts generate? How many new sales? How much did the average sale increase? What impact did your efforts have on gross margin?
Rule #5: Understand how the F.R.Y. metrics explain and support your social media goals. As Olivier described in his blog post, a compelling social media strategy should improve:
Frequency Increasing sales revenue by shortening the interval between transactions.
Reach (breadth) Increasing sales revenue by increasing net new customer count.
Reach (Depth) Increasing sales revenue by helping customers buy deeper into the product line.
Yield Increasing sales revenue by driving customers to want to increase their average per transaction spending.
Rule #6: Be prepared to detail how you intend to track sales that emerge from the social media channels. You must be able to track results to prove that your SM participation justified the company’s investment.
There. That wasn’t so hard. Now head up to the CEO’s office and tell him how you’re going to improve the company’s bottom line. And you can blog about it later.
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You’re Watching IBM
Tuesday
Apr 14, 2009
The Masters golf tournament is unique in many ways – one of them being their restriction on advertising during their televised event. While most golf tournaments show 16 minutes of commercials per hour, The Masters limits the amount of commercials to four minutes per hour.
This imposed limitation makes each minute of available commercial time more valuable, and actually makes the viewer notice the commercials more because of their rarity.
As a Masters junkie, I kept the tournament on my tv during the entire event, even while working. I just muted the sound so each cheer wasn’t a distraction, and glanced at the screen intermittently to monitor the leaderboard.
Because I watched much of the tournament with the sound off, I was struck by the effectiveness of IBM’s visual design cues that they integrate into every one of their commercials. Even with the sound off, I knew instantly when an IBM commercial was on simply by the consistency of their design cues.
A visit to Youtube confirms that every IBM commercial is bounded by an IBM blue letterbox border above and below the displayed video. This simple visual cue immediately conveys to the viewer that the commercial was created by IBM.
Even if the viewer is not actively paying attention to the commercial, IBM gains another imprint, another touchpoint, that reinforces their presence, increases awareness and strengthens their brand.
This video repetition is a simple design device that should be emulated by small business and by individuals trying to strengthen their own personal brand. What visual cues can you employ that differentiate your message and reinforce your brand image? It can be color, logo, wardrobe choice, tagline, message – as long as it’s authentic, it’s memorable, and it’s all yours.
Then start integrating those visual cues in everything you do online: email signatures, Twitter avatar, blog and website design, personal and corporate letterhead, business cards, social media profile pages – every visual touchpoint that allow you to make and reinforce your brand image.

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