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January 29th, 2010

Social Media Responsa to the Great ROI Debate

Posted by: Brian
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If you’ve ever spoken to me personally, you probably know by now that I’m not a big fan of ROI. (My response to Samir’s post may give you a bit more insight on some of my ROI thoughts.)

In general, I feel that ROI can be manipulated to include / exclude the projects that people want to move forward with. Issues in ROI did not start in the realm of social media – egregious hourly rates used in ABC costing and cost avoidance phantoms have plagued many.

(Credit)

It’s fine to track the path to sale of social media users on your website. And that may get you a pretty straight answer to ROI. I really don’t have time to write that kind of post for you right now. Plus, I prefer to write in a stream of consciousness; that’s just how I roll.

Here’s my spin on the value of social media:

I trust a company more because they relate to me on a medium I prefer.

Let’s break that out a bit:
Trust - repeat customer, bigger ticket, repeat business, one who refers others.
More – than the other company that has no clue.
Relate – human to human contact. Please don’t make me say “representative” again on your crappy IVR.
Me – you know, that elusive demographic you’ve been coveting.
Medium I prefer – social media. And not necessarily just Twitter.

What’s your take on the great social media ROI debate? Let me know in the comments.

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About the Author
Brian Wallace is the founder of NowSourcing, Inc., a social media agency since 2005 serving everyone from startups to the Fortune 500 and everything in between. Prior to founding NowSourcing, Brian worked in a variety of technical and marketing environments being a Chief Technology Officer for a noted media company. Brian holds an MBA and MS in Information Systems and resides in Louisville, KY with his wife and children. He started the group social media blog, Collective Thoughts and appears as a guest author on Mashable and Google Tutor.
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  • Pingback: uberVU - social comments

  • atomicpoet

    Nobody asks what the ROI of having a conversation is, yet everybody sees the value of it. In fact, IF someone were to ask me about the ROI of schmoozing, I’d laugh in their face.

  • Brian Wallace

    @atomicpoet: thanks for weighing in.  What’s the value if I connect a small business to a much larger business and they get a highly rewarding partnership? That’s when people wake up and smell the coffee.

  • http://www.thesocialwarrior.com Raman Kia

    Hi Bryan,

    Very insightful. I actually work with Samir at Morpheus Media. I am the Director of Social Media. Samir told me he was actually inspired to write his ROI post based on a post I had written on my blog called Forget ROI, It’s all About SVA (Strategic Value Added). He is a super smart guy but I would love your feedback too.

  • http://www.nowsourcing.com/blog Brian Wallace

    Hey Raman,

    Thanks for stopping in – I’ll be sure to read up and reply to your SVA post and give a follow up comment! Agreed that Samir is a smart guy :)

  • http://blog.gettrustworthy.com Kirk Skodis

    I love how you broke down your ROI statement. I fervently agree with the “medium I prefer” part which is all too often overlooked and underestimated. Reminds me of an old post I wrote about Krups: http://bit.ly/d1rPEZ

    Also, here’s my company’s take on the ROI of Social Media Response (pls excuse the linkbait): http://www.gettrustworthy.com/response

  • http://www.nowsourcing.com/blog Brian Wallace

    Hey Kirk,

    Thanks for dropping in. I checked out your links – funny that Krups didn’t even get back to you in the comments. Oh bother. :)

  • Courtney

    Like Kirk I love the statement. I hope you don’t mind if I use it to explain how social media is a different animal when it comes to metrics.
    It is about the value that you company can add to a conversation not necessarily what you get out of it, because that is obvious to me through your statement.
    I am also curious to know how companies are using Social Media. Is it just to drive traffic to their site or is it about starting a conversation? What tactics are working? What are common obstacles? How are you staffing for this medium?
    My company, White Horse, is currently doing a survey on this idea. I invite you to take it. We are sending the results to interested participants.
    The survey is here: http://www.surveymonkey.com/s/TZND7J2
    If you have any questions about my comment or the survey please feel free to contact me.

  • http://www.nowsourcing.com/blog Brian Wallace

    @Courtney: social media is indeed a different animal – one that the mainstream will still struggle to categorize and measure appropriately for the new few years to come.

    There is no hard and fast rule to how companies use social media – interesting survey, by the way – would love to see what comes of it!

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