How to Measure Social Media ROI

A recent article on MediaPost titled "Social Media Monitoring and Measurement" provides a useful rundown of the many challenges facing firms engaged in social media marketing. Srishti Gupta calls into question the utility of tracking sentiment and other variables associated with brand perception and attitude. She also goes on to describe how limited existing social media monitoring solutions are as media planning tools.

What she doesn't address in the piece is the question of how social media are transforming the way people discover information online. We find that 20% of the unique visitors to the sites currently running Meteor are coming by way of shared links. Those are links that are cross-posted from one site to another (eg. found on MediaPost and then posted to a Facebook profile), sent through email, sent via mobile device, etc. On sites that skew younger and/or that cater to a much more community oriented vertical like games, this % actually runs much higher. To wit, a Viacom/Microsoft study published in 2007 called The Circuits of Cool, reported that 88% of the links followed by people between the ages of 14 and 24 were sent to them by friends.

What a simple metric like the percentage of unique visitors arriving by way of shared links says about the importance of social media challenges the conventional wisdom shared by many in the online advertising community that social media aren't material to most campaigns. Perhaps the reason CPMs are so low on Social Networking sites is because the massive audiences there is engaging with content sent to them by individuals with which they're connected not from advertisers.

So what should online marketers be doing to measure the impact of social media on their campaigns and brands? First, they should be tracking and measuring the activity and value generated by this activity and not limit their metrics to proxies for sentiment and perception. It's now possible to track the actual traffic and conversions generated by the campaign content that's being passed along from person to person and site to site. That's what the Meteor technology platform does really well. Second, they should be exploring ways in which paid media are stimulating social media performance and vice versa. In the data our platform collects on behalf of our customers, we see a clear relationship between the traffic driven by paid media to microsites, landing pages, etc. and the organic lift via sharing that results. It is possible to uncover and increase campaign ROI with insights into the relationship between paid and social media.