The Elusive ROI of Social Media

I had the pleasure last week to participate in a panel session on the ROI of Social Media hosted by the Kelley School of Business at Indiana University in NYC.

Other panelists included:

Ruthie Wittenberg of NBC News;
Seth Silverstein of Entertainment Weekly;
Russell Pearlman of Smart Money and
Brent Campbell of A Hundred Miles an Hour

It was a fascinating discussion and one that continues to evolve and gain momentum as companies struggle to monetize their social media strategies. Although by far not entirely comprehensive (as we could have gone on for DAYS on the subject, not merely one hour), I thought I would share some insights from our Panel session:

• Sales of Old Spice body wash have increased by 107%+ since launching their “Man Your Man Could Smell Like” campaign. This campaign gained a huge following through a multi-pronged effort heavily involving social media – panelist Brent Campbell commented on the campaign, “140 million YouTube hits can’t be wrong.”
• Twitter celebrated its fifth year of operation in March. If you’re not familiar with how powerful Twitter can be, contemplate that on average, there are 140 million (and growing) tweets sent per day.
• Ann Curry won “Tweet of the Year” last year for a tweet that informed the Air Force that planes full of physicians trying to aid the Haiti relief effort were being prevented from landing. Due to all of the re-tweeting that took place to @usairforce, the planes were quickly allowed to land.
• Do you know the dollar value of a Facebook fan for a brand? Well, to be honest, we couldn’t nail that down either. One study claimed it to be $137, while another said it was $3.60. The conclusion we (the panel) came up with is that a Facebook fan is certainly valuable, but that dollar value depends on a myriad of factors about your company and your product. Along this same line, I read a fantastic summary by Ellen Kolsto of comments from Jen van der Meer of the Dachis Group at this year’s SXSWi: “the idea of loyal customers is becoming outdated in favor of social customers: the people who both buy your brand and tell others about it.” Well worth the quick read if you’re struggling with calculating ROI.

Certainly the over-arching theme shared by all panelists was that defining your goals and doing diligence to create a meaningful social media strategy can and will drive results (although calculating an actual ROI can be tricky at best). The biggest take-away was that you have to create a focused plan that includes actionable follow through (not just an occasional post or tweet).

My next blog will deep dive into specifics regarding surviving Air Travel.