What is the ROI of having "An Audience"?
While I am a fan of “measuring to manage well”, some things just can’t be measured accurately. Like having an audience. How do you even measure the ROI of an audience? That’s why I believe we should forget what the ROI of social media is, in the conventional sense.
Here’s the metric that matters most when it comes to using social media for marketing:
Is your target market talking about you?
That is a yes/no question. There isn’t a correct number to answer it. We can sort of measure if they are talking more than before of course, but are they talking at all to begin with?
Einstein may well have been talking about social media when he came up with this thought: not everything that matters can be counted.
I don’t recall who said it, but one of the greatest lines I have seen on this topic was:
The ROI of social media is that you will still be in business in 5 years time.
I believe that statement to be essentially true: traditional “push” marketing tactics increasingly struggle to generate decent ROI, especially as consumers “filters” (both psychological and actual technology filters) become more refined and prevalent. The marketing that will make all the difference in the near future will be the tactics that are centred upon having ideal prospects talking positively about you and what you do.
I can look at some measurements in my own business and say that social appears to be responsible for between 20% and 25% of new business revenue in each of the last 4 years. That is not an absolute measurement though. I account for new revenue opportunities by source as best I can, and frequently will have a new engagement where it is attributed to “I have been following your stuff for a while and you seem to know about…..” followed by “can you help me?”
The problem with social media in respect to measuring ROI is which channel do I attribute such enquiries to? Is it even attributable to social media at all? Could it be that it is attributable to positioning as “an authority”…and the social channels merely help amplify that positioning, together with website, blog, speaking…..you get the point hopefully: I find it difficult to attribute a new client or new engagement to a single source in reality these days. I think that will be true for many professionals today as they build “an audience”.
It is necessary to think of prospects as an audience too. As with any audience they will stay only as long as the show is living up to expectations at least, and while they are being given what they want. But our social media audience is seeing some stuff on Facebook, and Youtube, and some on Twitter, and some on LinkedIn…maybe following the blog and picking up a few ideas from Pinterest….and on it goes. Or was it the e-zine I mailed out?
It doesn’t really matter does it?
What matters is the total marketing spend versus the total new revenue. The only ROI measurement which does matter is the overall return on money invested by the business – including all traditional and conventional marketing tactics.
The magic of social media as a marketing tactic is the engagement level of a rapidly growing audience of willing participants. You can create a significant audience of genuine prospects for your business who want to engage with you and your brand. If your positioning and messaging are on point.
The questions that professionals who are investing marketing dollars into social media should continually focus upon are:
- Are we building an audience?
- Is the audience engaged and talking about us?
Related: Where Will the Greatest Disruption to Your Practice Come From?