Social Media and ROI for Steaz Organic Tea Drinks

Hello Readers,

This is the final destination on my Enterprise 2.0 blogging journey and I am pleased to say I have actually enjoyed this experience immensely and do feel I have learnt vital information to assist with my own and a company’s online presence. This week’s topic is ROI and the role that it plays in social media or more specifically:

“Your task this week is to identify and discuss an additional ROI case example on your blog. What is your view on how ROI was calculated? Did they include all the tangible and intangible benefits? What are the strengths and weaknesses of their approach?”

ROI and Social MediaImage Source: Bullet Point Branding

In simple terms, ROI (Return On Investment) means knowing the value of what you have invested (or your costs) and the value of what you have received or gotten back (your gains). The actual formula is (Gain from Investment – Cost of Investment) divided by the Cost of the Investment, which gives you the ROI percentage. So basically, having a high ROI means that you have a high amount of gains from that investment compared to the costs that you put into it. That is as simple as I can explain it, but ultimately it is a number that many Board of Directors and CEO’s are extremely interested in when it comes to budgeting and seeing the success of a campaign or activity. A recent Forbes survey revealed that for those working in social media alone, 66% of them felt pressure from their bosses to measure ROI in regards to social media activities.

The ROI case example I have selected to discuss is Steaz. It is an American company that makes organic tea soda and energy drinks and has only been in existence since 2002. Steaz and Social MediaThe case begins in 2009, when Steaz had the opportunity to sell their products in 1500 Target stores around the US, but in such a competitive market, they knew being quite an unknown brand they would need to optimise on this opportunity even though their budget was limited.

With the help of Chemistry, a marketing and PR agency, a $100K social media campaign budget was set (the organisation’s costs). As the brand’s primary target market was mothers, they researched and determined that 72% of this market found out about new products via social media and online channels, which could work to their advantage.

The results of this campaign were far greater than Steaz hoped for, originally just wanting Target to notice the new brand they had started stocking. By using social media monitoring sites like SocialMention and Viral Heat, as well as PPC, downloadable Internet Coupons, Blog and Twitter posts, and Facebook Ads, the brand had a number of ways of measuring how ‘engaging’ their campaign would be.

The Results:

  • 250,000 Internet Coupons were downloaded in 8 weeks (with a 20%+ redemption rate)
  • The brand received 3000+ new fans and followers on social media sites
  • Over 6000 blog mentions and reviews were recorded.
  • The PPC ads saw 20,000+ visits to the Steaz website.
  • A total of 30, 000, 000 impressions.
  • The Steaz brand was emptied from the shelves of Target and production had to be increased to meet the demand.
  • By December 2009 their sales were double the amount of their best month ever at over $1,000,000.

The fact that the brand used a variety of monitoring tools to be able to see tangible and intangible benefits was a very smart move. The biggest tangible benefit is obviously that production was increased as a result of their campaign and sales doubled, meaning their ROI was high. However, the brand was also interested in the intangible benefits like the promotion and word-of-mouth aspects that meant better relationships were built with their consumers.

Overall I think this was a great campaign and a good demonstration of how powerful social media can be for brand awareness and engagement with a customer to overall impact a businesses ROI. Building strong customer two-way relationships via these interactive tools, or the ‘intangible’ benefits can lead to many ‘tangible’ benefits as seen in the case, but can often be a lot harder to measure for bigger organisations or when a campaign is spread across a multitude of mediums.

While conducting my research for this topic, I found a few online ROI Social Media Calculators: ROI Calculator and Social Networking Media ROI Calculator. I am not sure I really understand how they would work for an organisation, so if anyone reading this has given them a go, I would love to hear your thoughts!

I appreciate any feedback or comments you have for me and thank you for reading through my adventures on Enterprise 2.0!

References:

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15 thoughts on “Social Media and ROI for Steaz Organic Tea Drinks

  1. Hi Brittany, I authored the DragonSearch social media ROI calculator – some years ago, in fact. It is in terrible need of an update – but still, it was intended as a starting point to think of the different ways social returns value and costs. Even when you’re thinking about each of those, there’s various ways of looking at the problem. At this point, it’s still a nice starting point just to get the thinking on the right track.
    Thanks for the mention!

  2. Just like you Brittany, I also came across DragonSearch and tried as I might, I still need to figure it out as well..calculating social media Roi is still in its early years but like you said, ROI is the only language that the chief executive and investors understand. 🙂 …nice read

    • Hi there. Thank you for your comment! ROI is definitely something chief executives focus on and will continue to focus on in the future. I am sure that as time goes by even more advanced social media ROI tools will be introduced.

  3. Hi Brittany,
    Another quality post as always.
    Personally until now i don’t think i have heard of Steaz until now – however their social media campaign seems to have had quite an impact on the companies market share and revenue! The fact that they managed to empty the shelves so effectively after the delivery of the campaign really speaks for itself!

    • Hey Chris! Thanks for our comment 🙂 Steaz is yet to come to Australia I think, but I definitely believe there would be a market for it here. They actually emptied shelves so quickly during this campaign that they were worried they would not be able to get enough production done in time to meet the current demand and that it might affect them negatively. Overall a very interesting case!

  4. Hi Brittany,
    This is interesting. There are so many excellent examples of the impact of social media in marketing (there is one of those levers again!). While it appears to me from the figures giventhat the ROI was about 1000% from the hard benefits alone, it would be interesting to find out how much Steaz placed on the less tangible benefits. One thing I noticed about ROI research was the more detail the company places on cost, the more accurate the benefits. For Steaz, their marketing research must have been a significant cost – did they just use E2 methods of research or was there traditional (and expensive) means employed? Did they manage the campaign in-house or consult externally? Finally, I am constantly amazed by these reports of such rapid, almost paroxysmal, returns from social media campaigns. How do businesses cope organisationally with such a surge in demand?

    • Hi David. Thanks for your comment. It would definitely be interesting to see what Steaz thought about the intangible benefits and how they recorded and used this for future campaigns. I believe the main market research for Steaz and this campaign were all E2 methods, however I am sure they used traditional methods too. As I mentioned in my blog, they did bring on a PR and Marketing agency Chemistry to help them out, which I think was a good strategic move. Steaz actually almost did not cope with the huge demand at first, when all of their product was sold from Target and if they had not reacted as quickly as they did it might have resulted in negative consequences.

  5. Hi Brittany 🙂

    Steaz is a new brand to me, but the success of their social media campaign makes me think I should have. Perhaps Australia isn’t in its crosshairs just yet. You mentioned how the intangible benefits can later manifest as tangible benefits, could you elaborate on this? I can understand the transition, but I’d like to hear more about what you had in mind!

    sammacgregor.wordpress.com

    • Hi Sam- thank you for your comment! Steaz is yet to hit the Australian market, but I definitely think there would be a market for them here. From a marketing perspective I think that marketers are always interested in building the ‘intangible’ customer-relationship side of things and hope that it will later on in time manifest to tangible benefits, like those satisfied customers purchasing from their brand. Do you agree? Thanks again!

      • I agree, a marketing team will likely want to build a relationship first so when they buy a product, they can transform that relationship into someone with loyalty, advocacy, someone who could become a product ambassador.

  6. Hi Brittany,
    Thanks for your nice post!
    I really agree with you that by using social media, companies change intangible benefits into tangible benefits. Apart from promotion and word-of-mouth, do you think defeating competitor on social media is also a very important aspect of intangible benefit?

    • Hi there. Thank you for the comment! I don’t think it would ever really be possible to ‘defeat’ a competitor, but definitely trying to have a better and engaging online social media presence would be seen as intangible benefit in the customer’s mind. Do you agree? 🙂

      • Yes, I agree. It seems like defeating an competitor is harder and harder nowadays. Samsung and Apple they all have their fans. And I think what you said in customer’s mind, will be a long-term intangible benefit.

  7. Hi Brittany,
    good blgopost again and an impressive example, which shows the success of the companies social media activities. However, I find it always a bit difficult to measure every single aspect (especially the intangible effects). In my opinion many companies and articles focus often too much just on the ROI instead of looking also at other effects. This can easily lead to the conclusion “When my ROI is not good enough, I should stop all my social media activities”. There might be some cases where the measure ROI is actually not very good, but improvements of aspects like the corporate culture result in very important long-term benefits for the company.

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