Measuring Social Media Effectiveness

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Measuring Social Media

Class Objectives • To determine if social media impact is measurable • To gain exposure to some measurement tools

Introduction The use of social media by businesses and organizations signifies a dynamic shift in communication. As highlighted on the business and social media module, businesses utilize social media to collect consumer feedback, fulfill organizations informational needs such as transmission of information to key stakeholder on products and general public relations functions. Social media has now become a central component in advertising. According to eMarketer Inc, search banners and video advertising will account for 80% of all advertising spending by 2016 (Wirthman, 2013). Furthermore, web video spending will nearly double from 7.9% in 2012 to 15% in 2016 (ibid). Unlike TV commercials, video ads are less expensive and small business can access the web and mobile devises to market their products and services. Google’s search advertising and Google AdWords for videos, for instance, lets small businesses pay only when users watch their videos. Companies can promote their videos by keywords which appear in YouTube search results, or display their video ads on different websites. Other organizations including nonprofit organizations use social media for advocacy and to garner support for various campaigns. In many ways social media is becoming a pivotal aspect for all forms of institutions highlighting the need to determine their effectiveness. Social media although largely low cost could have financial implications for organizations. Such costs could emerge from: labour costs (e.g. use of current employees or hiring external media consultants); software or online tools (e.g. subscribing for services or purchasing software); promotional costs (e.g. sponsored tweets, paid adverts); training (for employees); and legal risks (settings aside a budget for potential legal risks). Organizations that use social media seek to justify their media choices by highlighting social media effectiveness in their reporting systems. This module will focus on highlighting the possibilities as well as limitations associated with measurements of social media. Examples of existing media tracking tools will also be highlighted.

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Measuring Social Media?

Varied perspectives on measuring social media exist mainly because the use of traditional measurement tools of communication is deemed as an ineffective means of determining social media impact and effectiveness. Social media is distinct from print and electronic media (TV and radio) due to its interactive function (See Module 1). Social media privileges communication (rather than persuasion) as the foundation of consumer- marketer relationships because it is a two-way communication between organization or businesses and their key constituents (Duncan and Moriarty, 1998 cited in Pavlou & Stewart, 2002). This change in the character of marketing communications not only suggests the need for new measures of the effects and effectiveness of marketing communications, but it also suggests that the meaning of traditional measures of consumer response are now significantly determined by the interactive context Pavlou & Stewart, 2002). Similarly, Hoffman and Fodor (2010) point out that social media’s marketing Return on Investments (ROI) are measurable, but this process must begin with tracking consumers’ goals and investments. The investments include time money and the kinds of networks they engage with. The two authors emphasize that “instead of emphasizing their own marketing investments and calculating the returns in terms of consumer response, managers should begin by considering consumer motivations for using social media and then measure the social media investments consumers make as they engage with the marketers’ brands (p. 42). Critics of the effectiveness of measuring social media indicate that available social media measurements such as the levels of social media traffic in a given social media or common functions such as “likes”, reddit votes and even “retweets” do not provide concrete information that could assist organizations in determining why the audience is taking certain action in relation to specific messages. Stated differently, these kinds of responses do not provide qualitative data that could allow organizations to make useful decisions. Do you agree with this perspective?

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Supporters of the possibilities of measuring social media effectiveness on the other hand argue that social media advances interactivity in terms of increased sales as well as consumers participation (Cohn, 2013). Social media analysis allows businesses to get a picture of traffic on their sites, referrals from others sites and the characteristics of potential consumers (See illustration on Figure 1). Collectively, these elements are valuable for targeting or tailoring media messages, and for determining product or service exposure or reach. However, actual numbers of sales that can be attributed from social media traffic is difficult to determine. A number of ways have been advanced to evaluate social media. The first is by distinguishing tangible and intangible data generated by social media. The second approach is based on developing organizational goals and objectives and attempting to make linkages between social media and the organization’s imperatives. These two areas are discussed briefly in the sections below. Figure 1: Social Media Traffic

Table 1: Source: http://www.google.ca/analytics/features/analysis-tools.html Tangible and Intangible Data Tangible data refer to quantifiable elements. The use of figures, percentages, visuals including graphs are useful for tracking organizational revenue, spending, sales and growth. Companies also rely on quantifiable data to determine the differences between costs and benefits. In the social media context, the number of registered users provides organizations with an idea of their potential reach. The analysis of a media forum, for example could inform organizations on how many people access their sites via Facebook or Twitter. Google AdWords allows businesses to track how many viewers watched an entire video, or even if they visited the company’s website afterward. Other examples include when consumers click on an advert and proceed to purchasing the good or service. Organizations can also analyze the effects of providing information on social

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media and sales or if sales increased after certain information was sent out on social media. Real time reporting on Google Analytics allows individuals to view the social media traffic, that is, how many people are accessing the site at a given time, their location and the kind of content they are viewing. This element could provide useful information e.g. for product promotions because it allows individuals to see the pages that are most popular. Google analytics could also be useful in monitoring the effects of a campaign on an hourly or day to day basis (See http://www.google.com/analytics/ for additional information).

Hootsuite has also emerged as an important source of data. The site stands out because it brings together different social networks under one ‘roof’. It’s key social network integrations include Facebook, Twitter, LinkedIn and new Google+ pagers and an area of social content applications for You Tube, Flickr, Tumblr etc. (see additional details at: http://hootsuite.com/ ). Tangible benefits are vital in measuring social media effectiveness but intangible benefits are also presented as key determinants or organizations advancements.

Intangible data are difficult to quantify, they include attitudes, satisfaction or perceptions on things. Social media interaction emphasizes the intangible data. For example, blogs might provide information on why people visit the blog (e.g. to learn about new products) and what behaviors they might engage in once they get to the blog (e.g. post a comment about a recent consumption experience that can be linked to companies marketing objective (Hoffman & Marek, 2010). Other sites such as Reddit, a social news and entertainment website allows registered users submit content in the form of either a link or a text post. Other users vote the content "up" or "down", which is used to rank the post. Users can post links to content on the web. The website provides avenues for feedback but most uses respond by voting which is quite subjective (See http://www.reddit.com/).

Social media tools such as Google analytics allow advertisers to record the behaviour of those who click on their Ads. Such information might not reveal the reasons for a consumer’s interest but such details could be useful in determining how many people have been exposed to the message.

One way of evaluating the effectiveness of intangible data is by seeking to determine if positive comments on social media translate to higher sales over time. It is also necessary to look at trends. For instance, did your website store experience a spike in traffic soon after you posted some details on Facebook? (Cohn, 2013). Do positive comments on social media translate to higher sales? A good illustration of some intangible data is provided by Google Analytics Social Plug-ins Report which provides information on the kinds of posts that have been shared, social buttons that were used, and where the content was shared for (e.g. on LinkedIn or Facebook), analytic reports how many visitors were

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referred by social each social network (Twitter, LinkedIn, Facebook, Pinterest, Stumbleupon, YouTube and other networks), and displays which content page URLs were shared on each platform. Such information does not provide information on why the links were shared but it is certainly useful for an organization’s strategic planning.

The combination of both tangible and intangible data provides useful information for organizations. However, the use of social media MUST be aligned with an organization’s goals and objectives.

Goals and Objectives

To achieve credible calculations on the ROIs on social media, it’s important to have clearly defined goals and objectives. The goals should reflect connections between social media to higher sales or greater awareness. Similar to the development of Key Performance Indicators (KPI) in marketing, KPI’s are also important in strategic planning and reporting on social media investments (Schottmuller, 2013). This performance could be measured by purchases, demo requests, shares, downloads, or time spent on the website, Google Analytics Social Reports allow for KPIs to be reflected as goals (See figure 2).

Figure 2: Google Analytics Social Report

Google Analytics allows individual to assign each goal as a conversion. The tool enables dollar-based definition of social impact, revealing which visitors, social platforms, and content drive high-quality customers toward conversion and the bottom line, google links visits to organization’s or business’ goals and Ecommerce transactions. Businesses can choose the goals that are important to the business and can then review how social media as a source is helping to achieve those goals.

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Conclusion As presented above, a focus on intangible benefits, suggests that returns from social media investments will not always be measured in monetary terms but consumers perspectives and views are key considerations. The emergence of social media usage has elevated the audiences’ position in the communication process. Effective measurement of social media impact must be undertaken through a combination of different measures. The illustrations provided above reflect some social media tools that provide organizations and businesses with numbers and intangible data. The tools also provide organizations with a formal way of reporting allowing them to present their information through visuals and to articulate how social media can enable them to achieve their goals and objectives. It is clear that social media impact can be measured, what continues to be disputed is how to go about it. For this week’s discussion question, I would like you to think about your first assignment and reflect on how you would go about evaluating the effectiveness of the social media you selected for the assignment e.g. LinkedIn, Pinterest, YouTube, Facebook etc. What tool(s) would you use?

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References (Required readings in red) Cohn , M. (2013). How to measure social media ROI—Is it even possible? Social Media Today. Retrieved May 20, 2014 from http://socialmediatoday.com/compukol/1121551/how-measure-social-media-roi-it-even- possible Hoffman, D. Fodor, M. (2010). Can you measure the ROI of your social media marketing? MIT Sloan Review, 52, pp. 41-49. Pavlou, P & Stewart, D. (2002). From consumer response to active consumer: Measuring the effectiveness of interactive media. Journal of the Academy of Marketing Science, 30 (4), pp. 376-396.

Schottmuller, A. (2013). Social media ROI: 14 formulas to measure social media benefits. Retrieved May 20, 2014 from http://searchenginewatch.com/article/2249515/Social-Media-ROI-14-Formulas-to- Measure-Social-Media-Benefits

Wirthman, L. (2013. How to help your business’ video go viral. Forbes. Retrieved May 20th, 2013 from http://www.forbes.com/sites/capitalonespark/2013/01/14/could-your- business-go-viral/