kylejbritt

Three letters: R.O.I. Return on Investment.

We as New Marketers tend to dismiss any fear of an unmeasurable ROI with hot terms like “brand building” and “product awareness” in association with “community building” and “brand ambassadors.” Now I’m not one to downplay the significance of those intangible benefits, but in this argument, I fall on the side of these fearful corporations. New Marketing and specifically Social Media is still relatively unreliable, unregulated, and more often than not: unmeasurable.

That is the scariest thing to a CMO, Marketing Director, or Product Manager. Traditional advertising is measurable, predictable, and reliable. It may have a poor turnover percentage, but it’s there, black and white, clear as crystal. This is contradictory to the fact that we know Social Media in general is more like courting and less like hunting. It’s a longer process with a potential for better results, but with no measurable statistics to prove it.

So what are we to do as New Marketers? Even though the TiVos and the Hulus are changing the TV game and the big blogs are changing the Newspaper and Magazine game, once the final nail is in the coffin of traditional media, we will be no more reliable and predictable than we are today, unless we make some major changes.

In short, we need to define an ROI. Companies are starting to do it for themselves. Dell sees the value, claiming it has made $3 Million in sales through twitter over the past two years. So where is the ROI? Clickthrough is a good place to start, but how do you assign a value to “community building.” You can’t. But you can define an opt-in audience in terms of ROI.

There’s a successful international magazine I know that assigns a gross ROI to every single reader in terms of the increase in ad sales that reader provided them. For companies that are online and sell ads, that’s a good starting point, but it’s one we’ve been on for a while. How do you assign a value to a fan, a follower, a retweet, an @reply, a wall post, versus an actual visit to a website? The value is tough to assign, but in order to really make a difference in the way Social Media is viewed by Traditional companies, we must begin to measure it on a tangible scale, even if the scale is measured in months, not days.

So I say this to my fellow New Marketers, we need to work together to bring about case studies in ROI and begin the process of proving ROI on a scale that is easy to understand and is comprehensive. It is possible, because Dell, Naked Pizza, and others have measured their own, it’s time now to bring that measurement to a larger audience and begin to utilize ROI as a sales point and as a measurement of our own effectiveness.