An Employee's Look at Social Media ROI, Part 2
In the first part of this multipart series last week, I examined how a social media manager might be evaluated against employees who are directly accountable for generating sales and profit. This week in the second installment, I offer some metrics to track when evaluating the performances of social media employees.
(For part 1, click here.)
Marketing executives lead employees with diverse skills — skills that aren’t necessarily tied to sales and profit. For instance, pay-per-click managers can demonstrate reasonably clean relationships between advertising dollars spent vs. sales and profits generated. Email marketing and catalog circulation managers are easily evaluated based on their sales and profit contributions.
It isn’t so easy to evaluate individuals working in social media. So let’s consider metrics that social media employees might track in order to demonstrate some level of return on investment.
1. Customer service value. Social media employees track every interaction with customers. Any time social media employees solve a problem, they take credit for a portion of the long-term value generated from the company's average customer. At the end of the year, multiply problems solved by a portion of long-term value, yielding the "customer service value" generated by social media employees.
2. New customers. Social media employees can maintain dashboards that outline key performance metrics like new customers. Any new customer sourced from social media activities is tabulated on the social media dashboard.
3. Linkages. Social media employees track the percentage of customers in their databases that can be linked to any social media activity. Among those customers, social media employees count the number of interactions on an annual basis (e.g., tweets, blog posts, comments, reviews on their websites, etc.). This data is compared month over month, year over year. In time, social media employees will work with business intelligence teammates to find relationships between key performance indicators and linkages.
4. Recent interactions. The goal here is to identify 12-month buyers and lapsed buyers who interact with social media. This metric is valuable because it tells you that the customers are still fond of your brand, they've just not yet purchased. Recent interactions can suggest upcoming purchases. For example, catalog marketing managers can identify customers with recent interactions — especially those who last purchased three or four years ago — and send catalogs or targeted e-mail campaigns to them. Lapsed customers with recent interactions frequently outperform other lapsed customers. Social media can be a way to effectively segment lapsed customers.
In time, social media employees will be able to link dollar values to these and other metrics. They'll also be able to demonstrate the relationship between social media activities and sales and profit. At that time, these employees can be evaluated in a fair manner.
Granted, many of these metrics are difficult to capture. A multichannel brand needs to expand the scope of its customer database in order to capture relevant social media information. That said, the style of information capture outlined here is required to accurately measure ROI of marketing activities.