I’ve had some difficult discussions about how to measure the value of our web presence, and some even more difficult discussions on how we should measure the value of social media.
I don’t think visitor traffic says that much, our peak traffic days in the last year have coincided with announcements related to the current financial crisis. We’ve had assistance from the Dutch Government, a new CEO, and most recently an announcement that we will be splitting the company. On those days our web traffic soared even if our shareprice didn’t so clearly traffic does not equal value to the company.
For me there are two ways a site can generate value for a company; reduce costs or increase revenue. Social media programmes need to show the same kind of benefits, and there are plenty of examples out there, the DellOutlet twitter is perhaps the clearest example – where followers can benefit from offers from the dell outlet store that otherwise wouldn’t get much publicity.
I’m not the only one lamenting the lack of sensible thought within companies on measurment and ROI for web/social media; Jay Baer points out that we might be “cherishing the wrong trophy” when we chase facebook fans and twitter followers. David Meerman Scott dislikes ROI (like any good marketer) but still pushed for thinking about “creating buzz” and business impact in a recent presentation.
But the hands-down best, winner-takes-all explanation of why and how ROI matters in social media comes from Olivier Blanchard in this presentation.
Two items that particularly pleased me;
- the acknowledgement that it will take time, as in months, to realise the financial impact of social media (slides 28 & 60)
- the reference to those easy-to-get web metrics as “non-financial impact” (slide 34)
Aside from that there’s a certain genius in the use of images in this presentation – it’s worth a look for that alone.