Recently, we had the chance to catch up with Nathaniel Perez, global head of social experience at SapientNitro, as part of the research our team conducted for our in-depth eBook on “The Social Marketing Funnel: Driving Business Value with Social Marketing“. Given Sapient’s experience in the social realm, working with some of the leading companies such as Coca Cola, Foot Locker, Dodge and Dove, we asked Nathaniel to share best practices his firm is seeing with leading brands tying social marketing efforts to ROI relative to increasing the likelihood of a sale.
According to Nathaniel, there are many different ways that you can measure purchase intent – some direct and some indirect. It is very different for an airline vs. a sneaker retailer, and requires an even different approach and measures for a consumer packaged goods (CPG) brand that “doesn’t even have points of distribution that they own.” For example, for a CPG brand that doesn’t have retail locations, one could measure the impact of social media conversations on seasonals. In that case key questions that need to be asked are:
– How is the brand present in the social conversations?
– What is its share of social conversations?
– What was the sentiment shared on these conversations?
– How strong was purchase intent within the conversations?
Measurement can also be tied to metrics that are derived from existing campaigns or programs where the brand is already engaging with consumers – and where consumers may already be buying and using the product.
In cases where direct sales data is not available, brands can use equivalent media value to compare the impact of social marketing on purchase intent and sales. If a brand used direct media or TV advertising, it can arrive at a measurement of the impact on purchase intent by comparing the media value vs. that realized through the social channels. In this case, a brand needs to benchmark each channel used, then measure across them to understand the increased likelihood of purchase from a social investment.
In the eBook, we recommend the following two measures to help brands in all industries understand their ability to move a “social lead” into a traditional lead:
– Social Reach-to-Traditional Lead Ratio: This ratio measures your ability to move social profiles into your traditional marketing funnel over time.
– Social Profile-to-Sales Ratio: This indicator helps you track the number of social profiles turned into customers over time. Measure this ratio in the aggregate, as well as by social media platform. This analysis will help you identify the efforts on social media platforms that generate the most return on investment. (For a more detailed explanation of how brands can nurture “social leads” from the Social Funnel into the traditional marketing and sales funnel, please download our free eBook: “The Social Marketing Funnel: Driving Business Value with Social Marketing” (link))
For more direct ways to measure the impact of social marketing on sales, Nathaniel recommends “the good old sampling method for CPG products, or coupons that are offered contextually. Those are practices that, if not abused, are a very effective way to measure how fans within a context – say Facebook – react to a conversation and how that conversation can lead to trial and conversion. And then you can do that in different media, and you can compare the effectiveness of social vs. of, say, online or mailings.”
Nathaniel shares our belief that tying social profiles to traditional CRM systems is going to be the way brands link the direct and indirect impact of social marketing to business ROI. According to Nathaniel “the magic is mining all the traces of public conversation or any kind of public demonstration of opinion or content consumption. Then you start getting the media makeup of your CRM audience in a very vivid way.”
How are you measuring your social marketing efforts? What direct and indirect measures are you using to tie social marketing to business ROI? We look forward to your comments, insights and feedback. Let’s continue the conversation on this blog, Twitter: Follow us on Twitter, Facebook at Awareness, Inc., Social Media Marketing Best Practices and Social Media Marketing Mavens pages, and in LinkedIn Social Media Marketing Mavens Group.