At this point, all kinds of businesses and organizations, including those in the water technology and treatment sector, have begun dabbling in social media. But, getting their feet wet (no pun intended) in these new mediums is one thing. Finding out if their program is paying off — meaning there is some type of return on investment (ROI) for all the time and effort required to manage a social media site — is quite another.
Placing value on social media
About two years ago, a Toronto-based firm, Syncapse, which specializes in online content management, tried to place a dollar value on every “like” or Facebook fan a company acquired. While the investigation did not specify whether it looked at just B2C Facebook sites or a combination of B2C and B2B, the company did come up with a dollar figure. After surveying 4,000 people, Syncapse determined the average value of a Facebook fan is $136.38. The study also found that up to 40 percent of these fans become a fan of a company because they are motivated by discount offers or product promotions. However, a sizeable number are fans simply because they “enjoy being advocates for the company,” which can prove very valuable for any firm.
Whether you believe each Facebook fan is worth approximately $136 or not is up to you to decide. However, as mentioned earlier, there comes a time when companies have to determine if these social media tools — Facebook, Twitter, blogs, YouTube, LinkedIn and others — provide a sufficient ROI for the company. While there is no clear-cut way to measure social media ROI, the following are some suggestions that water technology and treatment organizations can employ to, at the very least, see if the time and effort devoted to social media is paying off:
- Ask “why.” Many businesses jump into social media because their competitors or vendors are doing so. While that may be important to note, before starting a social media site, ask yourself why. Do you have a goal in mind? For instance, some companies start social media sites for search engine optimization purposes. For some companies, that is very important; for other companies, possibly not. Determine how you plan to use social media and why before diving into the social media pool.
- Develop some type of measuring system. Many businesses now regularly check to see how many visitors are coming to their websites. If they have an e-newsletter, they often check the analytics to determine how many people actually read the newsletter and what items received the most attention. The same must now be done for social media sites. Managers must find ways to gather, capture and measure similar data, such as how many fans they are attracting each month, how many visitors are commenting on postings, if a posting is leading to a sale and other metrics. Without this information, it is exceedingly difficult to understand if a social media marketing program is really working.
- Try to assign real-money values to social media. Many manufacturers are placing product promotions on Twitter. Clicking on the tweet leads to a form the visitor must fill out to get more information. The form leads to an e-mail sent to the visitor, which he or she can then use to take advantage of the promotion. Managers are accomplishing several goals by doing this. First, they are tracking how many people actually saw the tweet. Next, they are able to see how many filled out the form, which can lead to direct-mail marketing opportunities for the company, a valuable asset in itself. Finally, they are noting how many of the e-mails delivered led to a sale … and how much revenue that amounted to. Additionally, some manufacturers have used this technique to find out if it draws more visitors to their website or if there is an uptick in the number of people visiting their brick-and-mortar location. The dollar value you are able to assign to these results can be compared to the expense of running the marketing campaign, essential in determining ROI.
- Devote the resources to make the programs a success. If the conclusion has been reached that a company social media site is warranted, if some real-time analytics are in place to help measure and monitor the site and if some marketing strategies and programs are developed for the site, managers must make sure they have the resources in place to make the program a success. Managers must treat social media like starting a new product line or creating a new division. To know if the product or division is valuable, they must ensure enough resources are allocated to give the program a fair start. In 2008, Southwest Airlines allocated funds for just one person to handle its social media activities. Today, the company has created an entire department just for social media because it has proven to have significant value for the company.
A few years back, when social media was relatively new and getting a lot of attention, many marketing professionals believed it was the “goose that laid the golden egg.” They embraced it with open arms, believing it would be an inexpensive way to market a company and its products. We now know it has not always been as successful as anticipated and there have been noteworthy successes and unfortunate failures.
The good thing is that now that the euphoria has settled down, managers can take a much more practical and honest look at social media. Instead of rushing in to take advantage of the new medium, they can take a more analytical, strategic approach. Interestingly, taking this approach may actually result in a greater social media ROI.
A frequent speaker and author on water conservation issues, Klaus Reichardt is founder and CEO of Waterless Co. Inc, Vista, Calif., makers of waterless urinals and other restroom products. He founded the company in 1991 with the goal to establish a new market segment in the plumbing fixture industry with water conservation in mind. He may be reached at [email protected].