Those who understand Social Media don't talk about ROI

It is not uncommon to see people arguing passionately about “Social Media ROI”, thanks in part to discussion on the subject in Social and Mainstream Media. Businessweek recently published an in depth piece titled Beware Social Media Snake Oil.

It is important to remember that Social Media is just a medium for connecting with people (or customers if you prefer that term). It provides necessary platform or tools to reach out to millions of people instantaneously across time-zones in a cost effective manner. But since “Social” is just a medium, it doesn’t have any ROI of its own. ROI will depend on how well this medium is used for attaining a well defined objective. So ROI is for the “usage” and not the “medium”. Many people associate ROI with the medium and that is incorrect.

See this excellent interview with Lee Odden on Social Media Marketing and ROI. According to Lee, measuring ROI as a direct result of Social Media is not the right question. Social Media is a platform, not a tactic.

Moreover, Social Networks as a medium for connecting with Customers for branding and engagement is a very new development and unlike marketing through traditional media such as Television, Print or Radio, we are yet to fully understand how Social Media marketing affects consumer behavior. To borrow famous words of former Defense Secretary Donald H Rumsfeld, we don’t know what we don’t know about how Social Media influences consumer behavior. And in the absence of this understanding, it is prudent to say that those who understand Social Media don’t talk about Social Media ROI.

Rather than trying to measure effectiveness of Social Media campaigns through ROI, it is better to use other KPIs (for a good list, see 35 social media KPIs to help measure engagement).

So beware, next time some one talks about Social Media ROI, it is very likely that person is trying to sell Social Media Snake Oil.

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32 responses to “Those who understand Social Media don't talk about ROI

  1. Those who understand Social Media don’t talk about ROI http://bit.ly/5nO0DA via @AddToAny#humberpr
    This comment was originally posted on Twitter

  2. Pingback: Those who understand Social Media don’t talk about ROI « Murryanna's Blog

  3. Spot on @HKotadia Those who understand Social Media don’t talk about ROI http://bit.ly/8qSIKB #sCRM #CRM #PR #CMO #marketing #socialmedia
    This comment was originally posted on Twitter

  4. Spot on @HKotadia Those who understand Social Media don’t talk about ROI http://bit.ly/8qSIKB #sCRM #CRM #PR #CMO #marketing #socialmedia
    This comment was originally posted on Twitter

  5. RT @hkotadia: Thx 4 RT @SteveKoss: Those who understand Social Media don’t talk about ROI http://bit.ly/8qSIKB #sCRM #CRM #PR #socialmedia
    This comment was originally posted on Twitter

  6. Social Media Budgets http://bit.ly/8qSIKB #KM
    This comment was originally posted on Twitter

  7. Harish

    Thanks for this post you said it so nicely ….. We put it a bit different here and suggest one uses a cost-benefit analysis approach to figure out what SMM can do for the bottom line:

    http://commetrics.com/articles/metrics-3/

    Thanks for sharing.

    Regards

    Urs
    @ComMetrics

  8. Pingback: dre in the morning » Blog Archive » Thursday

  9. RT @HKotadia Those who understand Social Media don’t talk about ROI http://bit.ly/8qSIKB #smROI #socialmedia #sCRM #CRM #marketing #PR #CMO
    This comment was originally posted on Twitter

  10. Those who understand Social Media don’t talk about ROI #SocialCRM #Analytics http://bit.ly/7qtDKl -or how to avoid SM snake oil
    This comment was originally posted on Twitter

  11. Hmmm RT @HKotadia: Those who understand Social Media don’t talk about ROI http://bit.ly/8qSIKB #sCRM #CRM #PR #socialmedia #SM
    This comment was originally posted on Twitter

  12. RT @hkotadia Those who understand Social Media don’t talk about ROI | Thoughts on Social CRM and Analytics http://bit.ly/8hEjd8
    This comment was originally posted on Twitter

  13. RT @HKotadia: Those who understand Social Media don’t talk about ROI | Thoughts on Social CRM and Analytics http://bit.ly/8hEjd8 #CRM
    This comment was originally posted on Twitter

  14. @charleneli saw this & thought of u Those who understand Social Media don’t talk about ROI – Thoughts on Analytics http://bit.ly/8hEjd8
    This comment was originally posted on Twitter

  15. RT @TinyMalone: Those who understand Social Media don’t talk about #ROI http://bit.ly/8hEjd8 #CRM #sCRM #PR #socialmedia
    This comment was originally posted on Twitter

  16. Those who understand Social Media don’t talk about ROI | Thoughts on Social CRM and Analytics http://bit.ly/4HKfTI #scrm
    This comment was originally posted on Twitter

  17. RT @prem_k: Those who understand Social Media don’t talk about ROI | Thoughts on Social CRM and Analytics http://bit.ly/4HKfTI #scrm
    This comment was originally posted on Twitter

  18. RT @hkotadia Those who understand Social Media don’t talk about ROI & lists more effective KPI’s http://bit.ly/8hEjd8 #socialmedia
    This comment was originally posted on Twitter

  19. RT @hkotadia Those who understand Social Media don’t talk about ROI | Thoughts on Social CRM and Analytics http://bit.ly/8hEjd8
    This comment was originally posted on Twitter

  20. RT @hkotadia @ParamShobhit: Those who understand Social Media don’t talk about ROI | Thoughts on Social CRM http://bit.ly/4HKfTI #measure
    This comment was originally posted on Twitter

  21. Those who understand Social Media don’t talk about ROI | Thoughts on Social CRM and Analytics http://bit.ly/6HtFhn
    This comment was originally posted on Twitter

  22. RT @HKotadia: Those who understand Social Media don’t talk about ROI http://bit.ly/8hEjd8 #CRM #sCRM #brand #marketing #CMO
    This comment was originally posted on Twitter

  23. RT @franklogic @HKotadia: Those who understand Social Media don’t talk about ROI http://bit.ly/8hEjd8 #CRM #brand #marketing
    This comment was originally posted on Twitter

  24. RT @franklogic: RT @HKotadia: Those who understand Social Media don’t talk about ROI http://bit.ly/8hEjd8 | Wrong , ROI critical, as is CONI
    This comment was originally posted on Twitter

  25. Excellent POV on the confusion between ROI of social media versus KPi’s by @HKotadia http://bit.ly/8hEjd8 #crm #sCRM #marketing
    This comment was originally posted on Twitter

  26. Dear Harish,
    You are correct on one thing: Social media is a medium and doesn’t have ROI in and of itself. But so is TV, and it doesn’t have ROI either but every single true marketer will talk to you about the Return On Investment of their strategies on whatever media they choose. Therefore, there is talk about ROI on Social Media, just as there is talk about ROI on TV because it always refers to the strategy executed on that particular media and no other. A strategy may be brilliant but if the media chosen is not reaching the target market, my ROI will not be as high as expected. The two pieces are tied together. You can’t have one without the other and they both contribute to the ROI.
    Hope this helps clarify some concepts. Thank you for the opportunity of contributing to you and others.
    Warmest regards,
    Claudia

  27. Pingback: Social Media for the Rest of Us - December 18th, 2009 | In The Loop

  28. Four days after this post, you posted Olivier Blanchard’s Social Media ROI presentation that has received thousands of views, visits and discussion comments on various sites. He is not selling snake oil, and I definitely believe smart marketers, execs and consultants will not be afraid to ask about the ROI of taking their marketing in a new direction they’re unfamiliar with – if they DIDN’T ask, that would be a problem. People who already know a lot about it aren’t the ones seeking consultant help and standing to be ripped off by those who want to deflect attention from the question by calling it influence, engagement, relationship-driven marketing or any other keyword concept they pick up at a conference.

  29. by @hkotadia: Those who understand Social Media don’t talk about ROI http://bit.ly/8qSIKB #sCRM #CRM #smROI #CMO #socialmedia #PR #CIO #C..
    This comment was originally posted on Twitter

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