How to demonstrate the return on investment of your social media activities.

2. Michael Taggart
Head of digital and social
MRM
Twitter: @michael_taggart
Blog: mrm-london.com

3. What is R.O.I.?
ROI =
(Final value – starting value)
starting value

4. Now with carrots
20 x 5x
3 (or 300%)
5x

5. Examples of
non-financial outcomes
• Increase in website visitors and/or time spent on the
website
• Change in the ratio of positive/negative brand mentions
• Increase in Twitter followers or Facebook fans
• Increase in requests for product information
• A 20% increase in subscriptions to the e-newsletter
• A 200% increase in YouTube video downloads
• 15 comments on the latest blog post

6. Examples of
financial outcomes
• A 15% reduction in customer service costs by shifting
a portion of customer service activity to Twitter
• A 12% increase in online sales during a Facebook
campaign
• A decrease in cost per impression from £2.55 per
person per mention of brand to £1.22 by leveraging
social media channels
• £500,000 in sales attributed to new customers
acquired through Facebook.

7. Gary Vaynerchuck
tv.winelibrary.tv
Twitter
$15,000 on direct marketing
= 200 customers
$7,500 on bill board advertising
= 300 customers
$0 (except time) on Twitter
= 1,800 customers

8. Petco.com
pet supplier
Reviews
Return rate for products with reviews
= 20% lower
Return rate for products with 25+ reviews
= 45% lower
…saving on shipping, restocking, and
customer service costs

9. Ford Explorer
Facebook
Customers who went to the website
via a Facebook page
= 30% more sales than those
who went straight to website

10. Dell Computers
Twitter
Sales directly attributable to links on
Twitter in 2009
= $3,000,000

11. Nick Bamford, IFA
Informed Choice
Blog, Twitter
Blog about HSBC mis-selling + Twitter
syndication
= national media coverage

12. Sequence of events between
Initial investment and gain
Investment Nonfinancial Financial
Action Reaction
(£) impact impact (£)
Strategy and Tweets, RTs, Brand awareness, More customers…
tactics comments, product sentiment spending more…
‘likes’, online reputation, more often
(ie.campaign) loyalty,
downloads (financial ROI)
share of voice,

13. Sequence of events between
Initial investment and gain
Investment Nonfinancial Financial
Action Reaction
(£) impact impact (£)
This is great but it’s
not where financial
impact lives

14. Sequence of events between
Initial investment and gain
Investment Nonfinancial Financial
Action Reaction
(£) impact impact (£)
This is great but it’s It’s here!!!
not where financial
impact lives

15. Start with “why?”

16. Start with “why?”
Enhance branding/awareness
Protect reputation
Enhance public relations
Improve loyalty/retention
Build community
Enhance customer service
Facilitate research & development
Drive sales and leads

17. Showing a return
• Overall objectives – what do you want to achieve?
• Identify metrics
• Set an intelligent measurable goal
• Activity
• Measure – the ‘return’ is successful achievement of the
goal

18. Showing a financial return:
FRY (© Microsoft)
• Frequency (increase in frequency of transaction by
customers)
• Reach (net increase in customers)
• Yield (increase in how much customers spend)

19. Step 1: Create Activity Timelines

20. Step 2: Impact on conversations

21. Step 3: Measure
transactional precursors
Loyalt
y
Trust
Rep
Awarenes
s

22. Step 2: Look at Sales
(or another FRY outcome)

23. Step 5: Overlay all timelines
activities
social data
web data
transactions
loyalty metrics
etc.

24. CONTACT
Michael Taggart, MRM
Email: michael.taggart@mrm-london.com
Twitter: @michael_taggart
Blog: www.mrm-london.com
Tel: 020 3326 9913
Mob: 07780 008939

25. Attribution
All images used under Creative Commons licence:
SLIDES 1: digitalsherpa.com http://digitalsherpa.com/2011/02/24/7-metrics-you-cant-ignore-in-
social-media-content-marketing/
SLIDE 2: http://www.completesolutioninc.com/return-on-investment/
SLIDE 3: http://www.flickr.com/photos/36248441@N02/3346436761/lightbox/