Social Media is great (obviously you know we think so…) but it is difficult to track the ROI on social media activity. Hopefully this will help! Originally posted by Media Post.
by Erik Sass, 4/1/11
While everyone and their mom is now using social media, it has continued to suffer in comparison to established media like, say, television in one crucial regard: ratings and measuring return on investment. Fortunately a new cooperative effort by leading social media companies, the Social Media ROI Taskforce, has resolved the problem of measurement once and for all.
“We hope that by eliminating some of the uncertainty that has surrounded social media, the Social Media ROI Taskforce will help put the industry on the same footing as established competitors,” stated SMRT president Jim Callow, adding: “There can be no mistake about the position of ROI in social media, going forward.”
Specifically, SMRT concluded that ROI is “just not important,” according to Callow, who volunteered that “behind closed doors, most CMOs will tell you they really don’t care about ROI.” Asked why their public statements have been so at odds with their actual stance, he speculated it’s “just something they have to say to make their bosses happy.”
In keeping with its conclusion, SMRT rejected the idea of formulating a common metric, or group of metrics, for the social media business. While this goal was written into the group’s charter, most members of the SMRT board of directors felt that it was “too hard,” requiring at least several weeks of work and an excessive amount of business travel, which they dismissed as a “tedious bummer.”
In addition to ruling out the possibility of formulating a common metric itself, SMRT has also agreed on a policy forbidding individual members from attempting to nail down ROI on their own time — addressing this injunction to “all the nerds who… have nothing better to do on the weekend.”
Asked whether he believed the move away from ROI and measurement generally would have a negative impact on social media ad spending, Callow said “absolutely not. I mean, what are they going to do: not advertise in social media? C’mon. It’s like, a law that they have to.”