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?”
Image 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. The 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.
- 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!
- 10 Examples of ROI in Social Media
- Case Study: Doubling Sales Through Social Media
- Chemistry Creates Mom-Pleazing Campaign for Steaz
- CMOs on Social Media- Where’s the ROI?
- Proof Positive: Social Media Increases Sales
- Shot in the arm: The secret to success in shots…without going head-to-head with 5-hour energy
- Steaz Official Website