One of my favorite quotes about social media comes from Erik Qualman, the award winning author of Socialnomics. In the book Qualman states “The ROI of Social Media is that your business will still exist in 5 years”. This statement is rooted in the argument between social media marketers of whether or not there is a measurable return on investment for the time and money spent on social media marketing. The reason that it’s hard to get people to agree is that the perception of value is different for each business and even each marketing manager.
For most business owners most decisions are solely based on revenue. When it comes to other forms of online marketing like SEM (search engine marketing) there are clear metrics that make measuring ROI pretty straight forward. In fact one of the most enticing parts of most forms of online marketing is the massive amount of useful data that you can use to directly calculate ROI. With social media on the other hand, there is an added element of value that is a lot harder to measure, but arguably just as important.
- Brand Management: How is your brand viewed by potential customers? While this may not translate directly into more sales, it is a crucial element that should not be overlooked by any organization.
- Consumer Awareness: Are you able to understand the wants and needs of your potential customers? Many organizations spend a lot of money on market research. With social media this information is at your fingertips for no added cost. By understanding your customer you will be able to predict problems and be able to more quickly adapt to any situation.
With time, social media metrics and measurements will surly improve, however that does not mean you should wait to participate. The fact is, social media is not a fad but a game changing element in marketing as a whole. If you can’t keep up then you will be left behind.
