Marketers often lament their inability to figure out their return on investment in social media, but that doesn’t need to be the case, according to Rex Briggs, CEO of Marketing Evolution.
In fact, Briggs said his data shows the ROI for social is higher than other forms of digital marketing. He spoke to Digiday about how brands can actually predict what kind of ROI they will get in social media and the mistakes many brands make.
What’s the biggest challenges that brands are facing in digital?
Many marketers approach social media as icing on the cake rather than as the main course. The reason for this is that brands think that social media cannot be tied back to ROI. But the fact is, social media has higher ROI than any advertising form, and you can predict what kind of ROI you are likely to get from social media. There are only a couple components of social media, and it starts with something we call the momentum effect. The first thing brands need to analyze from the get-go is what fan base they have. Second is analyzing how connected those people are in their networks. So if they share, how many will see it? Based on this, brands can actually predict how many people will notice their marketing messages, gain a positive perception of the brand and actually purchase. All of this is driven by real empirical analysis.
If this is the case, then why are so many brands lamenting social media’s lack of ROI?
It’s about sorting that information and people just don’t know they can do this. When you look at it, measuring it the first time is a bit of brain surgery, and then after that it becomes intuitive. The ROI of social media is going to be how many people engage and share. Guessing the values of that is hard when you have never done it before.
Are brands wrong when they preach about social media not being about ROI?
If you are a marketer and spending money and not thinking about ROI, you are missing the point. These are business decisions, and it involves spending money. Of course, there’s got to be some way to measure ROI. Anyone who says otherwise is smoking crack. You need to take a broader view of how marketing creates value. And at the end of the day, value means profits for a company.
What’s your advice to brands?
Marketers need to invest in the social media aspect first and then build an amplification of the rest of the campaign around it. First, get consumer insights, which can be done via social and any traditional research, and then build content and then amplification. Amplification works in two ways. First, it primes people. So if I see an adidas ad and then see a friend share something about adidas, the ad I saw has primed my brain. The second way is to reinforce. So if I see the social media piece first, my friend shares something about adidas and then I see the ad, then that ad makes the message stronger. It all goes back to this idea of surround-sound marketing and 360-degree marketing.
What’s the biggest mistake brands are making in digital today?
Not approaching the understanding of impact holistically. I think the best example to explain what I mean is 1800Flowers, which is the earliest example of multiple-media attribution. They thought 14 percent of sales were coming from search, but in fact search activity was being affected by online ads and offline marketing efforts as well. So in order for brands to really understand the ROI of any aspect of digital media, they need to start looking at advanced attribution modeling. Back in 1995, brands were looking at just the last click, and then by 1996, I think a number of marketers realized there’s more to it than just that. There’s all this stuff to consider, like what brought the user to that last click. All of the moving parts need to be considered.