>What is Your REAL ROI of Social Media? Part 2: The Effects of Having a Broad Perspective

20 08 2010

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As a small business owner engaging in Social Media Marketing (SMM), you want to measure its impact through a broad range of metrics that include both directly and indirect bottom line results. Social media allows for a wide range of marketing advantages due to its interactivity, targeted search engagement factors among others and because of this, a broad perspective should be taken when trying to decipher the true value delivered by social media outlets, metrics, and other monitoring tools.

Taking a wider view for your SMM can help your business:

  • Align your measurements to all of your business’s objectives and not just its sales. Focusing on and multiple of objectives and strategies may focus less on your ROI, or Return on Investment, but will strengthen the outcome of your Return on Objectives. Doing so indicates a successful achievement of broad-based objectives rather than just counting dollars, which in turn will allow you to count on those dollars later.
  • Enhance the development of your strategies. Having a broad perspective doesn’t just define measurement used after the launch of a strategic social media marketing plan; it helps in the development of new promotional ideas for your business. Setting specific long term and short term goals allows you to build a strong foundation for marketing measures. This makes it easier to approve or reject strategies as you’re developing them, saving both time and money.
  • Build widespread agreement. Gaining a common understanding on metrics and targets allows you, as the small business owner, to take into account the needs of your clients and those that are invested in your business. This can also enhance your strategic development by ensuring all collaborating teams are all striving towards the same goals.
  • Avoid short-term monetary gains at the expense of long-term brand health. You must not forget to test the results of other marketing strategies as opposed to those that are merely financially oriented. If you’re frequently offering promotions through social media avenues, you may see more (inexpensive) sales coming in but you need to take an account of the overall situation. Becoming a brand that is constantly offering promotions can be demeaning for your business’s presence—you become one associated with discounts rather than one associated with a strong affinity.

Taking a wide-angle view of the impact social media has on your small business helps you to avoid measuring the effectiveness of your strategies by narrow metrics, which can give incorrect assessments of your overall marketing plan success.

Essentially, you want to monitor the effects of your Social Media Marketing across a four-point perspective. Doing so allows you to balance the short term and long term marketing goals with the directly indirect bottom line outcomes. The four perspectives are:

1. Financial

2. Digital

3. Brand

4. Risk Management

Stay tuned for Part 3 of “What is Your REAL ROI of Social Media?” where we will do a breakdown of these four perspectives for your social media assessment.

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