How to Measure the Financial Value of Your Social Media Strategy
Did you know that many companies have trouble measuring the actual value of their social media strategy? Did you know that getting an accurate ROI figure is not that difficult with the right tools?
The minimal forms of methodologies commonly used to evaluate the impact of social media campaigns in financial terms forces organizations to employ sub-optimal marketing strategies without ever realizing that they are wasting valuable resources. As a leading social media agency, we advise our clients that they could be using more effective strategies if they know how well their social media efforts are performing.
The essence of social media as a stage for consumer interactions and influence has a large direct impact on a brand’s communities. There are reasons for social media marketing to receive a higher response rate and client engagement compared with traditional marketing focusing only on the company-consumer relationship.
What are the Elements of Social Media Success?
By creating the right mix of marketing strategy, social media technology, and refined modeling, you will be able to experience and measure the success of marketing through social media. This combination will produce, improve, and spread the brand’s identity.
Also, the right approach will inspire a brand community association between consumers, while bringing the brand advocates to the forefront. The right approach will help you reach potential customers through the existing ones, and much faster than traditional word of mouth.
The key component is to relate common social media measures such as comments, shares, conversations, mentions, likes, and other social signals to financial metrics by analysis of the impact, and the role, of the influence in the purchase decision. It is up to the business marketing and social media strategy to use comments, shares, and conversations to influence purchase decisions, along with other social signals.
How to Measure the Buzz
Social metrics are used to demonstrate changes in buzz, which result from your social strategy, and the changes to monetary gain. This is accomplished by creating a CIE and CIV framework to help identify the effects of various members' influence impact through ‘word-of-mouth’ marketing.
This framework provides marketers a procedure to measure the viral effect of the generated word-of-mouth on social media, by measuring the weight of influence that each customer has in terms of the capability to spread word-of-mouth through various connections and networks.
You can also set up business profiles on most social media platforms. The business account function gives you access to multiple analytics tools that are not available to the general public. The reports can demonstrate anything from unique post metrics, such as likes, shares, reach, and impressions, but also give you a snapshot of your audience and their activity dynamic.
What is the Fundamental Social Media Recipe?
The social media strategy consists of 3 phases:
1. The research stage, which is comprised of market research to get an appreciation for the possibilities of the particular social media penetration of the situation, and also, to identify the ideal social platform to use.
2. The pretest stage is when the flow of ‘word-of-mouth' and influence are both measured in reference to different message layouts to control for the effect of “tone” and use of “language”. This is similar to calibrating measurement tools for accuracy.
3. An implementation stage, which consists of multiple campaigns that are geared to stimulate ‘word-of-mouth’ and track resulting changes in sales.
The ‘consumer influence effect’, measures the ‘generated buzz’, and ‘consumer influence value’ measures the monetary value of the influence for any given user.
How is Word of Mouth Measured
To measure the impact of word-of-mouth in social media, it is important to understand and study how the information flows through the targeted network. This is done by calculating the ‘consumer influence effect’ of specific individual users. Then, sales data, which describes the purchasing behavior of each user, is then combined with the ‘consumer influence effect’ metrics to obtain the actual value generated by users. This is called the consumer influence value.
If you are wondering how this is all done, here are the steps:
- The historical data is used to pinpoint the influencers, which is done by studying the social network data and the directional flow of word-of-mouth.
- A match between the kind of information and the influence that each individual has on others was calculated.
- Based on this calculation of influence that each user has in step 2, the influencers were identified.
- During the run of multiple campaigns, social media influencers are encouraged to talk about your product. One method to accomplish this is with incentives, such as free clothing, totes, coupons, discounts, and many other items relevant to your industry consumers.
- The incentives are given to the top influencers with maximum effect and value.
- The results get analyzed and the performance of the firm after implementing the campaign metrics are measured.
- The Stickiness index also measures how much of the messaging is related to relevant topics to determine what users have in common. For example, if users talk about similar topics and items, then they will be more attractive to one another and have a higher influence so their Stickiness Index metrics will be higher.
Analysis of Target Markets
The target market can be determined by an analysis of how many people are talking about a certain topic. The software can be customized to your needs to track user networks throughout all the social media channels, along with the strength of their influence.
The same software, such as that used with Twitter, collects and archives conversations, positive or negative word of mouth, and it can be used on the social network related to any specified topic. The most important decision is to choose the right website development company to create your software for the right purpose.
What Should I know about the Viral Effect?
It is important to consider that users do not have a direct immediate association with each other and also that they were connected through 4 degrees of separation. These factors ensure that word of mouth does not get limited to groups within a small network.
The actual measure of ‘word-of-mouth’ is the number of times the message is passed on (degree), the number of connections that the message jumps (depth of influence), and the number of comments and replies received for each message (engagement impact). Personal and referral messages maximize the spread and influence of a message because people trust those who they are closer to.
One important thing to consider in maximizing the spread of a message is “Minimal Conscious Processing”, which is important to minimize the barriers to getting a message to other users. Make it easy for them to move the message without any thought to the actions.
The ‘consumer influence effect’ metric, as a standalone, can be used to quantitatively measure the degree to which messaging can spread from one specified user of social media. This metric is useful for viral marketing. For example, marketers can strategically publish a YouTube video to a group of high ‘consumer influence effect’ consumers to increase the spread of the content in a specific period of time.
Another way to make your content go viral is by following social media trends that are created by high-ranking influencers. Research the music and mediums that they are using, stick to a similar posting schedule, and pay attention to how they curate the feed. Hopping on social media trends is the best way to maximize reach and organic engagement.
Once you identify the right influencer marketing program you can then generate the viral spread of the information you need. Just remember the data and analytics so that you can track the actual financial value of this influence.
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