While corporate social media usage is now moving from “Gee, that’s cool! We need a Twitter page!” to a necessary business practice, most companies have no clue how to measure it. Plus, there really isn’t one way to measure, and the metrics your business needs to measure may be drastically different from those of your competitors. Think about measuring:
- awareness
- attention
- reach (fans, followers, subscribers)
- share of conversation
- strength of referrals
- recommendations
- inbound links
- number of social bookmarks
- traffic from shared shortened links
- leads
- conversion rates
- sales
- value per fan/follower
- direct response rates
- web analytics
But, in light of our tenuous economic recovery, let’s touch on what companies are thinking about the most… measuring cost savings. Because, sometimes the value in a business endeavor isn’t only about what goes up (like revenue), but what goes down (like costs). Social media can have some very clear efficiencies, most heavily on the customer service side, but also in areas like training or communications. So, now we’re talking about savings like:
- cost per issue resolution (costs like hardware, software, telecom service, HR, infrastructure overhead, etc.)
- issue resolution time
- cost per dollar raised/earned
- training
- idea generation
- employee education
For measurement to be effective, it has to align directly with the goals you’ve set. Following the SMART methodology, they should be specific, measurable, actionable, realistic, and timed. Metrics gain meaning when they’re weaved together to help you realize previously undiscovered insights about your customers and prospects… not just data.
There never is a single, concrete process for how to measure something. There are equation like ROI or ROE that are more or less fixed, but how you derive the elements of that measurement depend on your processes and what you choose to track.
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