It has been said that social media came of age in 2010. Not so for social media measurement. But the mainstreaming of social media marketing brings with it a heightened call for accountability. The need to prove the value of social media initiatives has never been greater. So, perhaps 2011 will be the year that social media measurement matures and comes of age.
As we look to the next year, here are five things to forget and five things to learn about social media measurement in 2011.
Things to Forget in 2011
The public relations industry has historically measured and reported success through the lens of quantity not quality. The most common PR metric today is Impressions. While it is a somewhat dubious metric for traditional media, it really loses meaning in social media where engagement not eyeballs is what we seek. Impressions also (greatly) overstate actual relevant audience. Impressions merely represent an opportunity to see, they do not attempt to estimate the (small) percentage of the potential audience that actually saw your content.
For Twitter, many folks use the sum of all first generation followers as ‘impressions’ for a particular tweet. The obvious problem here is that the probability that any one follower sees any one tweet is quite small. I don’t have good data on this (please share if you do), but an educated guess might put the percentage at less than 5%. Similarly for Facebook, use of impressions as a metric is also problematic. Facebook impressions do not indicate unique reach and you don’t have any idea who, if anyone, actually viewed the content.
Number of Impressions is a flawed, unwashed masses metric for social media measurement. Any time you are tempted to use the word ‘impressions’ in social media, think about ‘potential reach’ or ‘opportunities to see’ instead. Or better yet, concentrate on Engagement and Influence.
2. Vanity Metrics – Fans and Followers
Most social media measurement efforts place far too much emphasis on Fans/Likers and Followers. For Twitter, the number of Followers is seen as a key metric, thought by many to relate to potential influence. For Facebook it is the number of Fans/Likers many companies/brands attempt to maximize. While these may be the vanity metrics of choice, they fall far short of being adequate for rigorous measurement. The largest disconnect of course is these numbers really don’t describe potential audience size very well and they have nothing to do with interactions/engagement.
For Twitter, there is a growing amount of evidence (read the Million Follower Fallacy paper) that number of Followers really has little to do with Influence. Number of Followers may be an indication of popularity but not influence. Influence talks more to one’s ability to start conversations and spread ideas. For Facebook, number of Fans bears little semblance to average daily audience size and tells you nothing about engagement of the community. All Fans are not created equally. Some are engaged, some never return. Some are your best customers, others are there only to trash you.
Number of Fans and Followers are metrics you probably should include in your overall metrics set, but should be de-emphasized and not be a primary area of focus.
Measurement standardization is always an interesting topic to debate. On one side you have the folks who believe standards are absolutely necessary for measurement to proliferate, and on the other side you have the snowflake measurement disciples who believe each program is unique and therefore requires unique objectives/metrics. I fall somewhere between the two extremes.
In June 2010 IPR, AMEC, PRSA, ICCO and The Global Alliance got together in Barcelona for a conference intended to create an atmosphere for measurement consistency/standardization around a codified set of principles of good measurement. The Barcelona Principles as they have come to be called are basic statements of good measurement practice – focus on outcomes not outputs, don’t use AVEs, etc. Absolutely nothing to disagree with in the Principles. However, the heavy lifting of standardization comes at the metrics-level. Subcommittees have been formed that are taking the Principles all the way down to the metrics level. I have reviewed the work of the social media committee and believe there is a lot of good work being done.
But in 2011, I expect a lot of debate but not a lot of progress in creating social media measurement standardization. One to watch is the Klout score for online influencers which is being integrated as metadata in social media listening and engagement platforms. There are issues with the Klout score (read this post), and I question the type of ‘influence’ it is measuring – there is a big difference between motivating someone to action (e.g. retweeting your content) and motivating someone to purchase which is ultimately the type of influence many companies and brands are most interested in effecting.
4. Ad or Media Equivalency
One of the truly insidious aspects of public relations measurement is the use of advertising or media equivalency (AVEs – advertising value equivalency) to assign financial value to public relations outputs. It is a highly flawed, path of least resistance attempt to calculate return on investment (ROI) for public relations. There are many reasons why using ad equivalency as a proxy for PR value is not advisable.
To make matters worse, the practice has clearly moved into social media measurement as well. For example, research studies that monetize the value of a Facebook Fan/Liker by attributing an arbitrary $5 CPM value from the advertising world. Online media impact rankings also utilize equivalent paid advertising value to assign monetary value to online news and social media. The true value of social media is not how much an equivalent ad would have cost but in the impact it has on brand, reputation and marketing.
5. Return on Engagement/Influence/etc.
Not a day goes by without someone declaring a new and improved metric for the acronym ROI, or stating that ROI does not apply in social networks. A recent Google search for “Return on Engagement” returned 192,000 results. “Return on Influence” returned 68,300.
Most of the folks who use these terms either don’t understand ROI or don’t know how to obtain the data necessary to calculate it. Many confuse the notion of impact with ROI (addressed in Things to Learn). Engagement creates impact for a brand or organization, but may or may not generate ROI in the short-term. Creating influence – effecting someone’s attitudes, opinions and/or actions – creates impact but may or may not create ROI in the short-term. It often is better to think about measuring impact first and then deciding whether or not you have the means and data necessary to attribute financial value.
Things to Learn in 2011
1. Measurable Objectives
There are many issues and challenges in the field of social media measurement. The easiest one to fix is for everybody to learn how to write measurable objectives. Most objectives today are either not measurable as written or are strategies masquerading as objectives. (For example, any sentence starting with an action buzzword like leverage is a strategy.)
‘Increase awareness of product X’ is not a measurable objective. In order to be measurable, objectives must contain two essential elements:
- Must indicate change in metric of interest – from X to Y
- Must indicate a timeframe for the desired change – weeks, months, quarter, year, specific dates tied to a campaign (pre/post)
Therefore, properly stated, measurable objectives should look more like these:
- Increase awareness of product X from 23% to 50% by year-end 2011
- Increase RTs per 1000 Followers from 0.5% in Q1’11 to 10% by the end of Q2’11.
2. Impact versus ROI
ROI is one of the most overused and misused term in social media measurement. Many people say ‘ROI’ what they really just mean results or impact. ROI is a financial metric – percentage of dollars returned for a given investment/cost. The dollars may be revenue generated, dollars saved or spending avoided. ROI is transactional.
ROI is a form of impact, but not all impact takes the form of ROI. Impact is created when people become aware of us, engage with our content or brand ambassadors, are influenced by engagement with content or other people, or take some action like recommending to a friend, writing a review or buying a product. Impact ultimately creates value for an organization, but the value creation occurs over time, not at a point in time. Value creation is process-oriented. It has both tangible and intangible elements.
Your investments in social media or public relations remain an investment, creating additional value if done correctly, until which time they can be linked to a business outcome transaction that results in ROI.
Most social media initiatives today do not (or should not) have ROI as a primary objective. Most social programs are designed to create impact, not ROI, in the short-term. There is also the notion that many social media initiatives are in an investment phase, not a return phase of maturity.
3. Hypothetical ROI Models
One important step in determining how a social media initiative creates ROI for an organization is to create a hypothetical model that articulates the cascading logic steps in the process, as well as the data needed and assumptions used. The model is most useful in the planning stages of a program. It helps address the proverbial question, “If I approve this budget, what is a reasonable expectation for the results we will achieve?” Let’s take a look at a simple Twitter example:
Program: Five promoted tweets are sent with a special offer to purchase a product on an e-commerce site.
Hypothetical ROI Model:
- (Data) Total potential unduplicated reach of the five tweets is 1,000,000 people
- (Assume) 10% of the potential audience will actually see the tweet = 100,000 people
- (Assume) 20% of the individuals who see the tweet find it relevant to them = 20,000 people
- (Assume) 10% of those finding it relevant will visit the site = 2,000 people
- (Assume) 10% of those visiting the site will convert and buy the product = 200 people
- (Data) Incremental profit margin on each sale is $50
- (Data) Total cost of the social media initiative is $2,400
ROI Calculation: (200 x $50) = $10,000 – $2,400 = $7,600/$2,400 = 3.17 x 100 = 317% ROI
Our model suggests this program will be successful and generate substantial ROI. If in reviewing a model with someone who needs to approve a program, they conceptually buy into the model but challenge the assumptions, that is a positive step. Negotiate different assumptions and rerun the numbers. Hypothetical models help you think through the data requirements your research approach must address in order to actually measure the ROI of the program after implementation.
4. Integrated Digital Measurement
The definition of public relations is fluid, and rapidly evolving to encompass a much broader and more integrated view of communications and how we connect, engage and build relationships with consumers and other stakeholders. Digitization in all its forms has driven and accelerated this important change. Communicators should now take a more content and consumer-centric view of the world, orchestrating all the consumer touch points available in our increasingly digital world. At Fleishman Hillard, we capture this expanded scope and integration in a model we refer to as PESO – Paid/Earned/Shared/Owned. Here is how we define the elements of our model:
Paid – refers to all forms of paid content that exists on third-party channels or venues. This includes banner or display advertisements, pay-per-click programs, sponsorships and advertorials.
Earned – includes traditional media outreach as well as blogger relations/outreach where we attempt to influence and encourage third-party content providers to write about our clients and their products and services.
Shared – refers to social networks and technologies controlled by consumers along with online and offline WOM
Owned – includes all websites and web properties controlled by a company or brand including company or product websites, micro-sites, blogs, Facebook pages and Twitter channels.
The social media measurement Holy Grail in many ways is to be able to track behavior of individuals across platforms, online and offline, tethered and mobile, understanding how online behavior impacts offline behavior and vice-versa. We also seek to understand how the PESO elements work together synergistically. For example, how exposure to online advertising impacts conversions within social channels. To address this, your measurement strategy should be to take a holistic, integrated approach using a variety of methodologies, tools and data.
If you are not already familiar with value attribution models, prepare to hear much more about them in 2011. Value attribution models attempt to assign a financial value to specific campaigns and/or channels (e.g. advertising, search, direct, social) that are part of a larger marketing effort. So rather than giving all the conversion credit to the last click in a chain or even the first click, the model attributes portions of the overall value across the relevant campaigns and/or channels.
A simple model might look at the following metrics for each channel:
- Frequency – the number of exposures to a specific marketing channel or campaign
- Duration – time on site for exposures referring to the conversion site
- Recency – credit for exposures ranging from first click to last click, with last click typically receiving more credit.
Value attribution models require human analysis and expertise. This factor is often cited in studies as the reason more companies do not pursue attribution modeling.
Here’s wishing you and yours an exciting and prosperous 2011!