What’s It Worth

Starting the conversation on monetizing social media

Stating the Obvious

The problem with trying to determine ROI for social media is that you are trying to put numeric quantities around human interactions and conversations, which are not quantifiable.

What Is The ROI For Social Media? Jason Falls, http://www.socialmediaexplorer.com/2008/10/28/what-is-the-roi-for-social-media/

What is ROI?

ROI = Total End Value - CostCosts

X 100%

Why Use the PR Model?

Let’s face it – people would rather get the information they need from each other than get it from businesses. PR has long used a minimum 2.5x multiplier to quantify the value of earned versus paid media, recognizing that consumers value the information they get from other channels more than what they receive from your company. Making matters worse, consumers have been handed plenty of reasons not to trust business anyway.

Four PR ROI Approaches

1. Return on impressions 2. Return on media impact (akin to

market mix modeling) 3. Return on target influence 4. Return on earned media

Return on Impressions

Behavior change is expressed in dollars or gross sales, revenue provide a commensurate measure against the costs of the impressions.– Assumes that all impressions are equal.– Assumes that there is a singular point of influence.

Return on Media Impact

This model analyzes key independent variables, which include media placements (quantity and quality), advertising sales promotions, price, weather and anything else that could affect sales.– Assumes that every variable that affects sales

can be defined– Difficulty to isolate other influences such as

advertising

Return on Target Influence

Surveys can be used to show how varying levels of desired outcomes, such as awareness, attitude or behavior change, are influenced by media relations publicity.– Survey respondents don’t always know the

source.– Survey respondents may not differentiate

between media and advertising.

Return on Earned Media

Earned media (advertising value equivalent) is converted to paid media based on what it would cost to purchase the same amount of space in that same media outlet.– Measure cost-effectiveness rather than ROI– Difficult to determine the multiplier for delivering the

right message to the right people

What’s the Best Model?

What Should Be Measured?

What is the Influence Multiplier?www.drop.io/socialmediameasurement

Glennette ClarkInteractive Strategy ConsultantLazySmart Consultingglennette@lazysmart.com