Dare we say it? Social media measurement defined.

The world of advertising is full of silly metrics, probably because many who work there are suppressed novelists or film producers who didn’t carry calculators in college. Alas, the problem of foolish marketing math has gotten more severe with the advent of social media, where you’ll find numerous numb-headed attempts to explain how to “measure” “engagement” for “ROI.”

Data guru Anna O’Brien got so ticked off by the hyperbole she created the chart above to explain exactly what goes into true measurement. She writes: “It hit me. Adding qualitative aspect to a previously primarily quant-based world has thrown some people so far for a loop that they are willing to accept complete gibberish as a viable marketing solution as long as it has words like ‘tweets’, ‘likes’, and ‘posts’ built into the equation.” O’Brien’s resulting post is a brilliant kingdom-phylum-class-order-family-genus-species hierarchy of the measurement universe, and she keenly draws the distinction between monitoring and true measurement.

Funnel. Return. Value.

We suggest the truth is even more simple: There are only 3 basic questions that need to be answered for measuring any marketing performance.

(1) Where is the customer in the marketing funnel? (Is your target moving through awareness, consideration, or action?)

(2) What is the ROI on the marketing investment? (Does the financial gain from your initiative outweigh the cost?)

(3) What is the resulting impact on customer valuation?
(Customers are your real asset base; is their lifetime value rising based on your marketing activity?)

Customers are your source of financial value. Everything in marketing manages customers’ inflow of value with those questions. Everything outside of marketing measures the outflow of organizational costs.

Yes, even Razorfish got it wrong

The problem with most social media measurement is it touches only a subset of (1) above: the awareness stage of the marketing funnel. You can track the number of mentions of a brand online, and rank the people talking by their level of influence, and evaluate whether the “sentiment” is positive or negative. But do all that, even with Razorfish’s lovely Social Influence Marketing score (see page 24 of Shiv Singh’s Fluent report), and all you get is a mood ring for how much customers love your product while they are talking about you. The vibe of awareness within the earliest stages of your marketing funnel tells you nothing, really, about whether they moved to action and bought something, the resulting ROI on campaign investment or long-term customer value.

That’s OK. There’s nothing wrong with measuring small sections of your entire value chain, and social media itself is primarily conversations that do not provide insight into consumers’ true actions. But remember that. Don’t get carried away by software that tells you X brand was mentioned 2,318 times yesterday, and that sentiment was up to 0.79. If you can put a number to something that helps you adjust marketing course for improved results tomorrow, then you know the measurement has value.

Footnote: We are a huge fan of Shiv Singh, one of the sharpest minds and clearest speakers in social media, and this post is not a knock on his insights. We just find the Razorfish social media score a narrow view of one way customer value flows into your organization, even within the confines of social media, and should be labeled as such. Hat tip to Anna O’Brien and the comments on her blog for inspiring this post.

3 thoughts on “Dare we say it? Social media measurement defined.

  1. Ben, you know I’m a fan of ROI. I believe in measurement and I believe that you need to justify spend. But I’ve got to believe that there’s a place and a need for unmeasurable, feel-good, buzz-centered, old-fashioned branding and customer relationship efforts.

    Let’s consider branding and social and the like to be the same as Abilify. Abilify in and of itself is a pharmaceutical that does nothing to cure depression. But when taken in combination with the Prozacs of the world, it enhances recovery and enriches lives. That sounds pretty good, right?

    So I would argue that we need to get away from measuring ROI in terms of individual tactics, disciplines and programs and start measuring it in light of the entire marketing effort. Because when we take away our Abilify when it’s not “performing” in and of itself, the totality of the benefit to the patient is reduced. So too with marketing. When we measure our social effort purely based on response, we neglect the ways in which it enhances the likelihood of the direct program generating leads or the sales call generating a deal.

    The buzz-centered metrics are troublesome, no doubt. And I agree we need more meaningful ways of evaluating effect. But holding it up for evaluation by the ROI gods, ignores that the real purpose is long-term investment in your identity, relationships and advocacy. No single effort can generate these things. But without investing judiciously in them we earn nothing but the sale, when we could also be taking home the customer’s heart.

  2. I think the biggest impact social media and sentiment analysis has in advertising is only realized when you apply it over time as well as geographically in correlation with the media buy of your campaign. Then you can see the impact your creative is having not necessarily from a monetary standpoint, at least not immediately, but from brand/campaign image standpoint. You can easily see where the campaign is being successful and where to make adjustments.

    It’s really the first time we can actually measure word of mouth (both with sentiment and how individuals reach/impact each other), and many still value that as the most influential way to reach consumers.


  3. Ben,

    Thank you for the praise and the critical thinking expressed in your post.

    Regarding the SIM Score in Fluent, I’d like to mention a couple of points. Firstly and most importantly, it is not meant to be the only metric for social influence marketing. The introduction makes that clear. As you correctly pointed out, there are absolutely other metrics. (My Dummies book coming out next month touches up on many of these, excuse the shameless plug.)

    Secondly, as the report also alludes to, social has different meanings at different points in the funnel and as you look the research in the previous section of the report, I try to make that very clear.

    Thirdly, the SIM Score is meant as a brand health metric. It has its place but it is not all inclusive for every facet of marketing and most importantly as a first iteration this score does have its weaknesses too. Brand health metrics are important but they’re different to funnel ones.

    Hope that helps and thanks again for the thoughts. It furthers all our thinking.

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