Determining The Impact Of Customer Relationships: Social Media Measurement & Analysis

 

Determining the Impact of  Customer Relationships  Social Media Measurement & Analysis  

 

  4970 El Camino Real Los Altos, CA 94022 650.960.3600 www.crimson-consulting.com 

Karen O’Brien  Chris Terschluse  Partner  Social Media Analyst   Interactive Services   Interactive Services      Copyright © Crimson Consulting, Sept. 2009      

 

INTRODUCTION


“Although  companies  understand the  importance of  social media and  PR measurement,  they have not yet  mastered  execution” 

­MarketingProfs   

 

The Internet has become a vibrant social space transformed by web platforms that have enabled communication, collaboration, and sharing amongst individuals online. Online audiences look to build networks and relationships via the social web to connect with people, organizations, and content relevant to their own personal experiences. In social media marketing, marketers must work to establish and maintain these online relationships to create an impact on critical business objectives. Today, more than two-thirds of marketers have adopted social media. While adoption may be widespread, many still do not understand how to effectively leverage social tools to provide measurable outcomes. Crimson’s work with a variety of Fortune 1000 companies, has shown that many organizations are in various stages of social media adoption. While each organization has different needs and uses for social media, providing measurable business outcomes for digital marketing efforts has become a necessary challenge for all marketers. Understanding the type of data that exists on the social web, as well as defining relative metrics for social media measurement, paves the path for impactful analysis. Insights gained from social media measurement can provide direction for both strategy development and optimization. Defining strategic objectives and relevant success metrics for social media campaigns will give marketers the knowledge necessary to determine the financial impact of social media marketing efforts.  

 

WHY
SOCIAL
MEDIA
 MEASUREMENT

 MATTERS
TO
 MARKETERS
 70% of  marketers do not  believe they  adequately  measure their  own social media  campaigns 

THE SUBJECT OF CONVERSATION The online audience not only connects with colleagues, friends, and family, but a growing majority is establishing connections with brands and products via social networks, blogs, micro-blogs, and other forms of social media. In a recent study by eMarketer, 52% of US social network users respondents stated that they had become a fan/follower of some company or brand. Another 46% said something positive about a brand/company, compared to 23% who had stated something negative about a brand/company. Whether companies like it or not, online audiences are talking about their product, organization or brand, making it important to listen to what customers are saying and establish a dialogue. MEASURING FOR SUCCESS Understanding how to effectively monitor and measure a social media campaign sets apart those organizations that successfully utilize social media from those that fail to justify its value. In a recent poll by MarketingProf’s, more than 70% of respondents did not believe their companies adequately measured their social media campaigns. The study also concluded that 25% of marketers did not know what to measure, while another 30% stated they lacked the necessary resources. At a time when social media marketing continues to grow in importance and use, effective measurement has become an essential component of social media marketing. Understanding how to measure social media allows marketers to learn about their customers and create highly optimized campaigns that provide value both financially and strategically.  

 

 

THE
SOCIAL
MEDIA

 MARKETING
PROCESSS


Figure 1.1 

WHERE TO BEGIN Social media marketing can be approached as a cyclical process in which organizations listen, measure, engage, and then optimize marketing efforts. Organizations can also approach social media marketing by adopting one or more of these strategy components (Figure 1.1). For example, BMW’s Mini Cooper team used social media monitoring (listening) in order to develop critical insights from the online audience. These consumer insights were then used to determine the direction and message of their entire marketing mix, both traditional and digital. Companies that adopt an engagement strategy must first employ the listening stage of the social media marketing to effectively engage their target audience. For example, Dell used social media listening for brand management. Dell began their social media efforts by monitoring conversations around their products and services to identify relevant and pertinent discussions. They were then able to segment and target their blogger outreach and Twitter strategies to maximize impact and influence of customer conversations around the brand.

     

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THE
IMPORTANCE
 OF
LISTENING
 
 90% of online  audience’s  worldwide trust  recommendations  from people they  know, while 70%  trust opinions  posted online  ­ Nielsen 2009 

WHY WE LISTEN Today, more than ever, people research products and services online before making a purchase. A recent Nielsen Global Online Consumer Survey revealed that recommendations by personal acquaintances and opinions posted by consumers online are the most trusted forms of advertising. The survey showed that 90% of online audiences trust recommendations from people they know, while 70% trust opinions posted online. Social media marketing utilizes a pull strategy, allowing customers to reach out to those products, services, and brand that are relevant to their own experiences. Therefore, it is essential that organizations know where and how to engage this audience to provide value in a relevant and personal manner. Through the social media listening process, organizations can find answers to these questions and determine how to establish connections to effectively market a product or service via the social web. A VIRTUAL FOCUS GROUP Listening to the online audience essentially serves as a virtual focus group. Conversation occurs across a wide array of social web components such as ratings/review sites, blogs, multimedia sites, wikis, and social networks. Real-time data allows marketers to identify trending topics of conversation around products or services and can even identify influential members of the target audience. Listening reveals insight into satisfaction, brand association, brand loyalty, product ideas, product improvements, demographics, competitor activities, and market opportunities. Organizations can use social media monitoring to gain a deeper understanding of the online audience that will help guide marketing strategy development. For example, social media listening can be used for brand management. Organizations can monitor the online conversation to discover what audiences are saying about their brand and then determine how to tailor their brand message. LISTEN BEFORE ENGAGING Social media marketing allows organizations to establish meaningful and impactful relationships with their target audience that build trust and authenticity. Social media marketing works similar to offline conversation and business networking. A dialogue is established in which both parties exchange thoughts and ideas. The exchange allows individuals to find relevant connections, which may then lead to a relationship. Companies need to begin their marketing process with social media monitoring to first listen to conversations occurring online. Listening to and analyzing online communication helps marketers decide their level of involvement, whether it be monitoring the online conversation, participating in it, or leading the conversation. 

 

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TRADITIONAL
WEB
 ANALYTICS

 


Sources for web traffic pin points exactly what sources drive unique visitors to the website

The impact of customer relationships via social media must be measured in terms of the media itself (sites like Facebook, Twitter, MySpace etc.), the target customers, and the total impact on business outcomes such as sales and market share. The Internet today can provide both valuable quantitative insight (what, when, where), as well as rich qualitative insight (how & why). TRADITIONAL WEB METRICS Traditional web analytics offer quantitative insight into use of the media. Tracking metrics such as traffic, click through rate, and bounce rate, provides information about the number of people visiting the site, length of page view, and click path. This data effectively measures the reach and frequency of the audience’s media use, and can easily be monitored through traditional web analytic tools. Advanced social media analytic tools are also beginning to integrate traditional web analytics into their monitoring dashboards. These layered tools give organizations a 360-degree view of their online marketing efforts. QUANTITATIVE IMPACTS Measuring and understanding the reach and frequency of social media use allows businesses to determine the web’s impact on important outcomes such as awareness and sales. Using traditional web analytics, marketers can work to optimize metrics like traffic, unique visitors, inbound links, and unique visitors through SEO and social media marketing efforts.

Traffic generated per blog posting gives insight into content strategy by identifying posts that drive traffic

KEY INSIGHTS Traditional web metrics are an essential component of social media measurement, as they provide a good indication of reach and frequency. These metrics directly relate to important objectives such as awareness, successful content strategy, and site design. Metrics like traffic can be linked to both online and offline, marketing efforts through embedded codes or URL’s used to assess campaign penetration. Web analytics can identify sales attributable to affiliate marketers and leads generated by social media content. Metrics such as bounce rate, time spent on site, and click through path, also provide valuable insight into successful website design and overall user experience.

 

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\

SOCIAL
MEDIA
 ANALYTICS



Conversational sentiment reveals audience opinion and satisfaction with products/service or organization.

Real-time conversational trends measure conversational activity and identify buzz

Social media analytic tools identify influence based on customizable predetermined criteria: sentiment, authority, # of comments/responses, and reputation

 

SOCIAL MEDIA METRICS Social media analytics provide qualitative insight into the audience’s thoughts, feelings, activities, and demographics. As people continue to share and converse online, this type of data becomes more rich and insightful. Tracking metrics such as online sentiment, brand associations, trending topics of conversation, product ratings/reviews, number of comments, and opinions helps marketers identify who their customers are and what they are saying about a product or brand. This data, combined with traditional web analytics, can also measure how engaged individuals are with online content, which helps determine the level of influence individuals maintain within their online social graph. By understanding influence and engagement, marketers can then reach out to customers and effectively establish relationships. QUALITATIVE IMPACTS Measuring and understanding audience thoughts and behavior, as well as engagement and influence can provide actionable insights for marketers. Social media analytic tools collect conversational data from across the social web. These tools present conversational data in a number of ways including time-series trend charts, tag clouds, online sentiment by product or topic, share of conversation, sphere of influence, and engagement. This data can then be combined with traditional web metrics to provide even more accurate insight into the impact of marketing campaigns. KEY INSIGHTS Time-series charts and tag clouds drill down topics of conversation around a brand, pinpoint increases/decreases in buzz, identify brand associations and other related trending topics. Online sentiment provides insight into product/service satisfaction and qualitative opinions about brands. Share of online conversation is a good determinate of online market share. Organizations can even measure brand associations around topics of conversation with competitors. Other sets of data such as demographic data or behavioral data can also be utilized to identify the level of influence of the online audience. Social media analytic tools may then contain workflow components that allow marketers to then easily monitor and engage brand advocates, prospective leads, or dissatisfied customers.

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ESSENTIAL
MEASUREMENT
TOOLS
 Marketers should combine both traditional web analytics with social media analytics when measuring social media efforts. Utilizing both sets of data will allow marketers to draw comprehensive conclusions about measurable impacts on strategic objectives.

WEB ANALYTIC TOOLS Google Analytics: Free web analytic service that is offered over the Internet. Users paste a snippet of HTML code on web pages to receive a full dashboard of web analytics. Google Analytics is a fairly sophisticated tool that can also be synced with Google Adwords to maximize SEO. Omniture: A subscription based enterprise class web analytics service. Omniture’s SiteCatalyst also integrates analytics for social websites Twitter & Facebook and features advanced video and mobile analytics. Webtrends Analytics 9  Webtrends: Webtrend’s powerful Analytics 9 tool provides a similar enterprise based solution to monitor traditional web analytics. Analytics 9 features unique data mining & analysis tools, that allows users to easily make sense of the information.

SOCIAL MEDIA ANALYTIC TOOLS Radian6: A social media monitoring tool with a very visual and intuitive user interface. The tool offers real-time social media listening analysis, social media metrics, CRM capabilities, and team collaboration and workflow. The tool can also integrate traditional web analytics into it’s dashboard.

Radian6 Dashboard 

Visible Technologies: Visible Technologies offers a wide range of tools such as truVoice and truPulse that monitor conversations from across the web and allow for direct engagement via the tool. BuzzMetrics: Social media monitoring tool offered by Nielsen. Aggregates conversations from across the web to give insight to brand reputation, customer management, product management, and campaign tracking and measurement.

 

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ESTABLISHING
 VALUABLE
 RELATIONSHIPS


 “Companies that  are both deeply  and widely  engaged in  social media  surpass their  peers in both  revenue   and profit  performance by  a significant  difference”  

­ Wetpaint/Altimeter 

Group ENGAGEMENT db  Study 2009

 

SOCIAL MEDIA SEGMENTATION Effective engagement occurs after listening to online conversations and analyzing both the quantitative and qualitative aspects of social media. The knowledge acquired through this process allows marketers to segment the online audience through their use of social technology. Marketers can then identify the sources of influence amongst the online audience, whether it is influential blogs, viral videos, social networks, or micro-blogs such as Twitter. Marketers can further drill down the influence and general disposition of individual users into categories such as brand advocates, passives, or brand detractors. Using Forrester’s technographic ladder (Figure 1.2), marketers can segment the online audience by technology use, providing direction on how and where to effectively engage the audience. Identifying the important and influential members amongst the online community provides touch points for the engagement strategy. SOCIAL MEDIA INFLUENCE MARKETING: OUTREACH & ENGAGEMENT Engaging with customers establishes direct communication with individuals to inform, energize, support, or embrace. Reaching out to social influencers can create powerful word-of-mouth marketing to authentically spread an organization’s marketing message. Marketers can utilize social tools to establish a dialogue with influencers and provide them with relevant content and information, with the expectation that they will spread positive messages among the online community. Marketers can use social tools in many ways such as informing customers about new products or energizing enthusiastic customers by recognizing brand advocates. They can use social tools to support customers either through forums or direct outreach to solve product/service issues. Marketers can even embrace the online community, allowing customers to come up with ideas to improve products or services. Through these outreach and engagement strategies, social media can transform

Figure 1.2  Forrester Research, Ladder of Social  Tenchnographics  

 

marketing efforts into a powerful word-of-mouth engine.

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SOCIAL
MEDIA
 OPTIMIZATION


 “The concept  behind SMO is  simple: implement  changes to optimize  a site so that it is  more easily linked  to, more highly  visible in social  media searches on  custom search  engines (such as  Technorati), and  more frequently  included in relevant  posts on blogs,  podcasts and  vlogs.”   ­ Rohit Bhargava  

 

CONTENT & ENGAGEMENT Social media marketing is a dynamic process. Consistently benchmarking and measuring social media campaigns leads marketers to social media optimization (SMO). Marketers can optimize social media through number of methods such as increasing user engagement, increasing inbound links, or making tagging and bookmarking easier. Actionable items such as RSS feed subscriptions, social sharing buttons (Twitter, Facebook), downloads, uploads, or streams, should be tracked to provide an indication of effective content strategy. Items that attract stronger engagement can be optimized across the site to encourage deeper interaction. Blogs can also help pinpoint content that drives traffic and encourages engagement. Social media marketers can use a simple metric, the conversational index (ratio of blog posts to comments/track backs), to gauge their content strategy by subject or topic. Marketers can then use this wealth of information to tailor and optimize content to increase traffic and interaction. SHARING ONLINE It is important to track and optimize viral marketing efforts as they continue to become a major component of social media marketing campaigns. Metrics for tracking shared content can take the form of social velocity (rate a message travels across the internet), direction (where the message is heard), amplitude (the size of the conversation around a brand or product), and period (the duration of the conversation). MEASURING SHARED INFORMATION Marketers can use these metrics to discover optimal methods and locations for seeding the spread of their content. Businesses may want to focus on channels with the high social velocity to rapidly increase awareness or channels that foster in-depth conversation to change opinions and inform. Marketers can even work to stimulate sharing of content by encouraging users to generate their own content or integrating social sharing and bookmarking tools on their website. Measuring these metrics around shared content allows marketers to maximize the spread and exposure of syndication. Creating related actionable items within the video, image, blog etc, such as a link to a branded website or an ecommerce store may also provide a method to measure sales directly attributable to the content.

 

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DETERMINING
THE
 IMPACT
OF
 RELATIONSHIPS
ON
 KEY
BUSINESS
 OBJECTIVES
&
 OUTCOMES


LINKING METRCIS TO OBJECTIVES Sales Impact and ROI of social media marketing may be determined by layering data sets together and linking traditional web and social media measurements to their impacts on sales metrics. While standard social media measurement practices remain in their infancy, social media strategy development is critical. When assessing the financial impact of social media marketing it is important to maintain clear campaign objectives backed by a set of welldefined metrics. Social media measurement should be tailored to the unique goals and objectives of the marketing campaign or organization. Marketers can then use trend analysis and statistical modeling to relate changes in social media and web analytics to actual sales data.

MEASURING THE IMPACT OF RELATIONSHIPS Social media marketing, much like traditional marketing, can be utilized to build awareness around a brand or product, which may result with impact on sales reach or net new customer count. Social media marketing may also increase sales by tapping into customer relationships via the social web. Marketers can use social media to encourage customers to buy deeper into the product line and increase average per transaction spending by cultivating brand loyalty and customer service satisfaction. Marketers can also work to increase buying frequency by shortening the time interval between purchases through coupons and special offers via communication tools like Twitter. Employing social technologies can even result in signification costs savings. For example, Linksys used a peer-to-peer support community to reduce customer service costs. Measuring these impacts of customer relationships will give marketers a clearer understanding of a ROI for social media marketing.

 

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CONCLUSION


While businesses continue to adopt social media as an exciting new marketing practice, many still struggle to justify an ongoing commitment and investment in the channel. Many executives still consider social media marketing as an experimental tactic rather than a long-term growth strategy. This is understandable given that 84% of marketing professionals still do not measure an ROI for social media programs. Understanding how to measure social media marketing’s bottom-line impact allows marketers to communicate the value of their efforts to key stakeholders. In a period where budgets remain constrained and expenses must be justified, marketers can only continue to integrate the channel into their marketing mix once a method of obtaining a ROI has been established. The ease of access and use of social tools has led to the widespread adoption of the social web among both businesses and consumers. It is now up to the marketing professional to develop creative, wellplanned strategies to harness the power of social media marketing as a successful business platform. Once effective social media marketing strategies are put in place, business may work to build valuable assets out of their customer communities. The Internet provides businesses with more in-depth information on marketing efforts than ever before. Understanding the type of data that exists on the web and its multiple applications will help marketers create highly measurable social media campaigns. Harnessing the long-term value of social media marketing can only be realized when short-term objectives provide impactful results. Marketers must now strategically pave this path toward meaningful social media measurement to determine the true impact of customer relationships.

 

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ABOUT

  

Questions? Contact:

Karen O’Brien Partner Interactive Services (650) 960-3600 ext. 335 [email protected] Twitter: bondjanebond  

Copyright © Crimson Consulting, Sept. 2009  

 

Since 1991, Crimson has provided product and market, channel and interactive strategy and implementation to some of the most successful companies in the world. Our clients include Adobe, Cisco, eBay, Hitachi, HP, IBM, Intel, Microsoft, Oracle, SAP, Seagate, Symantec, and Verizon. We are experts in the marketing of technology solutions. Our clients gain significant value from our contributions in the following areas: ■ Strategy Development ■ Research Analysis ■ Marketing Implementation Unlike other firms, we combine consulting best practices with specialized knowledge from a database of experts. This combination results in deeper strategic insights and more pragmatic recommendations, delivering greater value than our competitors.

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