Recently, I spoke at a conference on a panel titled, "How to Measure Social
Media ROI." One of the things I noticed, both at this conference and in my
career, is that everyone is fixated on the return part of the ROI equation, but
nobody wants to talk about the investment. When it comes to collecting the
return, we're ready to roll out the red carpet, but what about the investment
that makes the return possible? What are you willing to invest to get the return
you say you want?
Why We Become Disillusioned
Social media is a flexible and customizable medium for businesses to leverage,
but it's been the unfortunate subject of mainstream media hype. I'm sure you've
read stories of businesses achieving seemingly overnight success via MySpace or
some other social media tool, but social media isn't flat-out magic. "No one
really sees the 90 percent that you put into your social media efforts," says
Scott Ginsberg of
HELLOmynameisSCOTT. "They only see the 10 percent--the results."
Ginsberg should know. He started his blog,
HELLOmynameisBLOG,
in October 2004, and for the first six months, he had hardly any comments or
feedback. But he persevered and in August 2005, one blog post led to an
invitation to speak at a marketing conference, which helped him meet more than a
dozen new clients--and get a $100,000 contract. Now that's ROI.
Unfortunately many companies don't persevere. One study, from the book
Naked Conversations, showed that about one out of three blogs are abandoned
within a year. "Social media has created an ADD-like generation of people who
don't want to wait for the return," says Ginsberg. "There's a lie being spread
that tells people to work smart, not hard. Working smart is possible when you've
built your business up, but initially you have to work hard and long."
Between the ultra-hyped stories of social media coups and the declining focus
on the overall investment, it's very easy to see why entrepreneurs become
confused and impatient. To avoid disillusionment, it's vital to consider the two
elements of ROI--the return and the investment.
The Return
The return is what you hope to gain from social media, both in dollars and
intangibles, like increased speaking engagements, better conversations with
target markets, more fruitful connections, increased revenues, increased
visibility and buzz.
Taking the time to determine what you'd like to gain from social media before
delving in could keep you focused while ramping up sales. Once you've set goals
for your return, the next question is: What are you willing to invest to
generate those results?
The Investment
In the same way that currency is not solely monetary, neither is your
investment. You should consider what kind of energy, organizational staff and
other resources you're willing to invest to get the desired return.
Lest it be forgotten, a good portion of your investment is also your
message--having something unique and interesting to say about what's going on in
your industry instead of rehashing the same material over and over.
But what if you don't have the resources necessary to make a strong
investment?
No Resources + Substantial Expected Results =
Major Let Down
Recently, a client came to us because they wanted to start using social media to
increase their thought leadership and generate more speaking opportunities for
their CEO, but they didn't want to invest a lot of money or time. Our response
was, "If you don't have access to resources that you can leverage to make this
project a success, then we suggest that you buy an ad in a trade publication and
call it a day."
One of the golden rules of social media is: If you don't have time, you need
money or other additional resources; if you have no money, you need to have time
and energy. You can't be strapped for both cash and time and expect a grand
result. That just isn't realistic.