CONCLUSIONS PaPer

Five Best Practices for Social Media Measurement

How to link social media metrics to business results

Insights from the webinar, Less Talk + More Action = Better Results, in the Measure What Matters: Redefining Marketing Success in the Digital Age series, presented in association with the American Marketing Association and SAS
Featuring:

Katie Delahaye Paine, CeO of KDPaine & Partners John Bastone, Global Customer and Media Intelligence Manager at SaS

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If theres anyone out there who still believes social media doesnt warrant serious consideration, consider some basic facts: There are more than 750 million active users on Facebook, 140 million unique visitors to the site each month, 200 million registered Twitter users, and more than 100 million professionals on LinkedIn. Thats just for starters. In addition to social networking sites, there are blogs, comments on traditional media and e-commerce websites, review sites such as ConsumerSearch and epinion, content-sharing sites such as YouTube and Flickr, and collaborative projects such as Wikipedia. Nearly half of americans now get their news from the Web. One in five reads blogs. More than 80 percent of americans use social media in some fashion each month. Some of those people just might be talking about your brand and your competition. Some may be ambassadors and advocates, or they may just as easily be detractors and malcontents but all their voices are in the mix, shaping customers buying decisions. Who would want to ignore it? However, in this age of accountability, can you be sure that investments in social media are worth it? Can you prove the bottom-line value of this ephemeral new media?

If anyone still believes social media

is just an online playground for egocentric chatter, look at the role that Facebook, Twitter and YouTube have played in mobilizing protests in the Arab revolutions of late. The ability to connect and communicate over new media has even reshaped the dynamics of international rebellion, so just think what it might do for your business.

Social media is the preferred

contact channel for many people these days. A lot of outbound marketing and sales effort happens through Facebook, Twitter and LinkedIn. More than half of my clients never respond to an email but will respond immediately to a Facebook comment, message or tweet. Call a client by phone, and it might take three days for a return call, but that same client might respond immediately on Twitter.
Katie Delahaye Paine, CEO of KDPaine & Partners

Social Media: Driving Profits or Just Popularity?

accountability has never been more important in marketing, said John Bastone, Global Customer and Media Intelligence Manager at SaS. It isnt just about increasing awareness anymore; its about what we are doing to drive profitable revenue growth. In my role at SaS, I speak to a lot of customers and at a lot of conferences about the benefits of data-driven insights across a wide spectrum of technologies, such as campaign management, search engine optimization or Web analytics. Nothing has generated more buzz or brought more scrutiny than the topic of social media, specifically how to get more value out of that channel. Organizations often do not reap the value they should from social media, for several reasons: It is not being used very effectively. In an informal webcast poll, nearly 60 percent of audience members said their organizations are ineffective in their use of social media. another third think theyre getting there. Only one in 10 claimed their organizations were doing a good job of it.

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Those figures align with the results of a recent survey of more 2,100 senior marketers, conducted by SaS with Harvard Business review analytic Services (The New Conversation: Taking Social Media from Talk to Action, October 2010). The study found that the use of social media was stronger in certain segments such as retail, organizations with more than 10,000 employees, and the computer services and professional services sectors. Risks are magnified on social media. Bad practices in traditional media marketing are just as bad on social media except the mistakes can reach more people faster and create more damage. Consider Kenneth Coles misstep in a widely derided tweet about unrest in egypt. Or edelman and Wal-Marts gaffes in creating fake blogs. Or the pervasive habit among marketers to use social media for screaming without listening. Social media has been mostly about intangible effects. When asked to name the primary benefits social media has brought to their organizations, most respondents in the study pointed to increased awareness, website traffic and favorable perceptions of the organization. awareness. Hits. Happy thoughts. Thats all fine and well. Its gratifying if consumers like you. But do they buy? Do they recommend? Does all this awareness, website traffic and goodwill translate into dollars and profits? For most organizations, the answer is, Hmm, we dont really know. In a webcast poll, 70 percent of respondents said their organizations did a poor job linking social media efforts to profits. When asked the most pressing challenges they face or anticipate facing with social media, shortfalls in this area topped the multiple-choice list: 41 percent Understanding the potential of social media to make a difference in the business. 40 percent Measuring the effectiveness of social media activities. 31 percent Linking social media activities to an impact on company financials and/or rOI. No surprises there, said Bastone. Organizations realize the benefits of social media as it relates to awareness, but now the question is how to link this to tangible value in the company in a way that starts to justify the investment.

Becoming Effective with Social Media: Three Areas of Focus

To evolve from ineffective to effective in social media requires organizations to focus on three areas, said Bastone: listening to the conversations that are out there, processing the structured and unstructured (text) data available from social media channels and then doing something about it.
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Five Best Practices For social Media MeasureMent

1. Listen
Organizations need to grow a bigger set of ears, said Bastone, borrowing the phrase from colleague and social media guru Chris Brogan. If you want to find out what customers think about you, theres a ton of data out there on message boards, review sites and discussion forums. You need to become more aware of these alternate sources and pull them into your monitoring efforts. at the same time, you need to be able to filter out the irrelevant content in a very standard, repeatable way. Use social media scanning tools to find out what people are saying. Listen for public relations opportunities, marketing opportunities and customer service needs. Track the sentiments in conversations. align all of this to internal metrics. For example, how many customer service complaints are you finding via the Web? Look deeper than the conversations du jour, Bastone advised: Its not enough to listen to just the last seven days or 30 days of commentary. Your listening and measurement efforts should start to accumulate a year or two years of sentiment, so you can see trends and understand whether a shift in sentiment is significant or seasonal.

Being in the public domain, social

media conversations represent a resource-rich source of customer information as well as a good source of competitive information.
John Bastone, Global Customer and Media Intelligence Manager at SAS

2. Process
Taken at face value, the social media data you collect will be only marginally useful just figures that tell you what was, but not necessarily what that means, or what to do about it. With analytics, this data can be processed to deliver useful insight: Descriptive statistics clarify activity and trends, such as how many followers you have, how many reviews were generated on Facebook, and which channels are being used most often. Social network analysis follows the links between friends, fans and followers to identify connections of influence as well as the biggest sources of influence. Text analytics examine the content in online conversations to identify themes, sentiments and connections that would not be revealed by casual surveillance. The text analytics part of it is an emerging science with exciting potential. This piece alone has several elements to it: Content categorization. The system scans social media content and organizes it into logical categories, said Bastone. Youd want to be able to say, This is a public relations thread that deals with corporate reputation, versus This is a customer service thread that deals with issues of customer satisfaction. Organizing content by category is a core piece in being able to triage conversations for routing to the appropriate people in an organization.

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Text mining. In the same way that you can use data mining to explore data in your databases and establish relationships, you can now do the same thing to all those unstructured text documents. You can dig around in volumes of emails, Facebook comments, consumer reviews and more, and look for themes, connected concepts and volumes of conversation. Visualization tools make it easy to see what people are talking about right now, what issues are hot and which are not, said Bastone. So you dont necessarily have to know what youre looking for, to understand what is important right now. Sentiment analysis. This form of natural language processing looks at how people use words and phrases in context, and then assigns a sentiment positive, negative or neutral based on the words people use. You can classify and categorize the sentiments in online content, look at trends over time, and see significant differences in the way people speak either positively or negatively about you and your competition.

3. Respond
There are two elements to this: responding internally and externally. Share with your audience. Comment on blogs and participate in conversations and not just to hawk your product or service. Be visible, be where the community is, answer questions, reply to emails, offer help, funnel complaints into the customer service workflow, and build relationships with bloggers. Publish useful, informational and responsive content via blogs, online newsletters, photos, slide decks and videos. Act and adapt. Insights from social media should be embedded in business processes, said Bastone. all this listening and processing are ultimately about being in a better position to acknowledge and respond to issues that are coming in through social channels in real time or near-real time, being able to change your underlying business processes in response to positive and negative sentiment thats coming in through your social channels, and ultimately integrating that into everything you do.

Five Best Practices to Get the Most from Social Media Measurement
1. Consider all the ways social media can drive profits.
Social media as a channel tends to be most strongly aligned with marketing or marketing communications, said Bastone, but its impact is reverberating across the enterprise. Many different groups have a vested interest.

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The most obvious business functions that can benefit from social media tracking include: Online media analysis. Where are consumers talking about you? How is volume trending? Who are the most influential sources? Which sites are more positive? Negative? Brand and market tracking. What do consumers say about your brand, your products and your competition? What is the impact of these discussions? Who are the influencers? Public relations and reputation tracking. What are online journalists and bloggers saying about your organization? What is the threat to your reputation? Where are the opportunities to build advocacy? Customer feedback management. How do perceptions voiced on social media compare to direct customer feedback from other sources? are there issues that require response or resolution? The key is to create business processes whereby information from social media is translated into action. Customer complaints should be funneled to a customer care center. an identified need can be routed to a sales contact. an influential blogger can be referred to the public relations department as a potential new media contact.

Some online conversations are relevant to marketing, public relations and sales, but just as many are relevant to customer service, competitive intelligence, human resources, investor relations, product development or anywhere else in the organization where its meaningful to listen to customers.
Katie Delahaye Paine, CEO of KDPaine & Partners

2. Know what you want out of social media.

Define the R in your ROI. To be able to prove the rOI, you have to have a tangible business goal to begin with, said Katie Delahaye Paine, CeO of KDPaine & Partners. What is the return that youre hoping to deliver? Why are you doing this? What is the problem you are trying to solve? Define the audience. Who are you really trying to reach? Its one thing to go out there and reach 57 million people, but thats not very meaningful if those 57 million people are not really your target market. Home Depot may reach the world with their social media presence, but if the closest Home Depot store is 70 miles away, youve got to have a lot of loyalty and engagement to win that part of the audience as customers. You need to be brutally honest about your target audience and whether you are in fact reaching them, said Paine. Establish benchmarks. everyone tears their hair out and says, There are no benchmarks in social media. But thats not really true; there are. Theres always your competition your peers that you can benchmark against, said Paine. Instead of asking how much positive sentiment you have, youd want to know your share of positive sentiment amid all positive sentiment in the marketplace. Conversely, if your business operates in a controversial area, you could gauge your relative - rather than absolute - share of negative sentiment.

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Define your Kick Butt Index. What do your bosses define as kicking butt? asked Paine. Find out what causes them to say Congratulations, you are really kicking butt out there, or Hey, were really getting our butt kicked. What are those metrics? If executives agree to this up front, you have a tangible way of proving the value later, said Paine: You can say, We agreed the metric we were going to be judged on was cost per new customer acquired. That number was $67 a year ago; it is $37 today, so I am in fact kicking butt.

The first thing you have got to

understand is this: Its not about you. Too many marketers think social media is basically just another way to get the word out, when in fact its a very different entity. The entity is the conversation.
Katie Delahaye Paine, CEO of KDPaine & Partners

3. Make it a two-way conversation.

Marketers are having to make an adjustment to account for the fact that the social part of social media demands a give and take, said Bastone. as online conversations about your business are happening, you need to not just talk about yourself, but engage people in a two-way conversation. Paine agreed: The first thing you have got to understand is this: Its not about you. Too many marketers think social media is basically just another way to get the word out, when in fact its a very different entity. The entity is the conversation. There are lots of ways to use social media not just as a way to get the word out there, but to touch customers and interact in ways that you couldnt do before, said Paine. Savvy marketers will use social media to engage customers with the brand on a personal level, conduct customer meetings, gather feedback through surveys and focus groups, and identify opportunities for business development. When Paine posted on Facebook that she was planning to build a brick walkway that weekend, she received a comment from Home Depot with a link to an instructional video about how to build brick walkways. By offering to help as a trusted advisor rather than making an overt sales pitch Home Depot ended up scoring the bricksand-mortar sale literally.

4. Forget about impressions and hits.

For too long, we have been focused on counting eyeballs, and there is no way to count eyeballs effectively, consistently, or accurately in social media, said Paine. So just give it up. Half of your Twitter followers are robo-followers; theyre not real anyway. You may know how many people like your Facebook page, but how many are paying any attention to what you post there? even the sites/services that track hits, visitors and impressions are doing it inconsistently. I say hits stands for how idiots track success, said Paine. If all youre doing is counting hits, youre not tracking anything that is meaningful in todays marketplace.

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Paine defined a five-level hierarchy of measurements, with each tier offering progressively more engagement a more meaningful measure of how well youre doing with social media. at the lowest level are the simple, descriptive facts comparable to impressions in traditional media: how many followers, friends, likes, visitors, hits, comments, etc. Impressions are a zero level of engagement, said Paine. You dont care how many eyeballs you reach; you care what those eyeballs have done, which brings us to the next level. Did they go to your site? Did they click through from the link you gave them? I classify likes as a Level 1, because its so easy to hit that like button, said Paine. My metric is not how many likes there are, but how many likes there are relative to how many people actually engaged in conversations on the site. Maybe 98,000 are likes, but if only 20 or 30 people are actually engaging in conversations, thats not exactly a high level of engagement. Most organizations are measuring at the more participatory Level 2 or 3, said Paine. If you are really good at getting engagement levels up there, youll get people who retweet, repeat comments and share posts. Thats a very high level of engagement. Ultimately (Level 4) you want their identity; you want them to register in some form, say nice things about your brand, and (Level 5) make a purchase and recommend you to others. as you move up the levels, the numbers will likely be small for now. Its important to set management expectations appropriately. The absolute numbers how many click-throughs or visitors are not nearly as important as what percentage of people are moving up the levels. From month to month, as social media followers and friends move from Level 1 to Level 2 and up, youll know how well you are doing in getting people to engage with the brand.

If you just take the customer

satisfaction score Did you like the lobby? Did you like the guest room? guests may not be able to pinpoint the thing that made them feel that way. If you are evaluating the design through some kind of analysis, you need specifics about what is creating that perception, and thats challenging.
Stephani Robson, PhD, Senior Lecturer, Cornell School of Hotel Administration

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5. Blend social media data with internal data.

Social media is a hot channel for understanding and interpreting online conversations, but it isnt the only source of conversations, Bastone noted. If you really want to evaluate sentiment, conversations, topics, what people care about or dont care about, it doesnt make sense to analyze social conversations in one silo and other customer communications in a completely different silo. It gets really interesting when you start to blend social media data with internal data, such as the sentiment captured from call centers, surveys, customer service records, behavioral data, online chat and customer emails. Supplement with external customer research, brand research and Web analytics to create an even richer view of the customer. Bringing this all together gives you a common lens to understand customer conversations and sentiment and a much better handle on leading indicators, said Bastone. If an uptick happens across channels, that is a more reliable insight to use as the basis for forecasting and other business decisions.

Closing Thoughts
Marketers talk about going where the fish are, but traditional methods are notoriously inefficient for getting there, said Paine. First, theres demographics. You say, OK, I have a fish that is this long and this wide and purple, and I know that statistically, 70 percent of all women between the ages of 18 and 55 like this particular fish. Then you send them an email or a junk mail or something. The reality is that they dont care. They really dont care. Consider this: 44 percent of junk mail goes into landfills unopened. Response rates of less than 0.25 percent are now considered acceptable. On average, less than 1 percent of all emails are opened and acted upon. So using demographics is not a very efficient way to reach your target audience. What about traditional mass media? Inefficient fishing as well, says Paine. Suppose you run a lawn care company that puts an ad in a paper that reaches 50,000 people in a geographic area. Youll reach potential customers who are so far away that, with the high price of gas these days, youd be losing money on their business. among customers within a certain radius, perhaps half dont even have lawns, and half of the remaining prospects actually prefer to mow their own lawns. Ultimately the target market is a small subset of the larger audience you paid good advertising money to reach.

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In reality, you want to help the people whose lawns are unkempt, said Paine. Youd want to drive around the neighborhood and just contact people whose lawns are a mess and say, I can help you. Thats what engagement in social media enables you to do. It enables you to identify somebody who has a problem, and earn their trust and loyalty. If you do that well with social media, can you prove it? Yes. Thanks to new search and analysis tools created for social media, you can connect click-throughs that lead to sales. You can track changes in sentiment in discussions about your organization. You can correlate sales to social media channels and campaigns. You can show the rOI. Conversations have always been going on around the water cooler, in front of the television set, and in the aisles of your grocery store and everywhere on the planet, said Paine. Theyve always been going on, its just that we never were able to track them before. Now we can.

There are technology solutions that sift through huge volumes of online conversations, parse textual data to discern sentiment and share of conversation, map sentiment to business issues and track click-through paths to your website. These tools are enabling progressive companies to do a very good job in showing the rOI.

John Bastone, Global Customer and Media Intelligence Manager at SAS

About the Presenters

Katie Delahaye Paine,
CEO of KDPaine & Partners Katie Paine is the CeO and founder of KDPaine & Partners LLC and author of Measuring Public Relationships: The Data-Driven Communicators Guide to Success and The Complete How-To Guide to Measuring Social Media. Paine also writes the first blog and first newsletter dedicated entirely to measurement and accountability. In the last two decades, she and her firm have listened to millions of conversations, analyzed thousands of articles, and asked hundreds of questions in order to help her clients better understand their relationships with their constituencies. Learn more about Paine at www.kdpaine.com.

John Bastone,
Global Customer and Media Intelligence Manager at SAS John Bastone is an integral part of SaS Global Customer Intelligence Product Marketing organization. With more than 15 years of experience performing marketing, computer programming, consulting and analytics roles for companies such as Verizon Data Services and Catalina Marketing, his areas of expertise are behavior-based marketing and social media analytics. Learn more about Bastone at www.linkedin.com/in/johnbastone.

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To view the on-demand recording of the webcast: http://www.sas.com/reg/web/ corp/1291086 For more on SaS Social Media analytics: http://www.sas.com/sma To view other aMa webcasts: www.MarketingPower.com/webcasts To view the SaS and Harvard Business review analytic Services research paper, The New Conversation: Taking Social Media from Talk to Action: www.tiny.cc/amasas

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