An Introduction to Spectrum Analytics for Social Media ROI
Social Media is a airly new communications medium andactivity that is oten considered to be “ree” and availableto everyone. With abundant ree and low cost tools andplatorms to create, promote, monitor and analyze socialmedia content businesses and individuals, excited aboutwhat Social Media can do or them, too oten assume thatmeasurement o Social Media can be taken care o asmore o an aterthought.In the past estimating Social Media ROI was acceptable,increasingly that is no longer the case as outlined byTheBrandBuilder, Oliver Blanchard
. As CMOs and CEOshave started to seriously consider Social Media as aneective marketing medium, they also seeking a similarlevel o precision in Return on Investment (ROI) metricsthey have gotten rom Direct Marketing. Everyone isattempting to devise a ramework or their company’sSocial Media ROI, but the challenge is somewhat dierentor each business and industry.What are the metrics; beyond the basics such as howmany Fans and Followers an account has that can actuallyhelp management manage better? And, o course, whatmetrics aect the HOLY GRAIL o business metrics: thebottom line?Lately, a lot o attention has been placed o ormulasto calculate Social Media ROI. In act, earlier this year Altimeter Group and Web Analytics Demystied shared aramework or Social Media Metrics and ROI
addressingthe Marketing Industry Challenge:”I can’t measure socialmedia ROI.” The metrics were generalized to t intoa ramework, which I analyzed
in a series o posts atWebmetricsguru.com. I believe the ramework is a step inthe right direction, but much more guidance is needed.I will even go urther by suggesting we avoid talking abouttwo dimensional ormulas in order to calculate SocialMedia ROI, even though it is tempting to do so, beorewe are able to capture the inormation to put into thoseormulas. While we can reduce a business’s nancials to aseries o ormulas that calculate protability or loss, whichis airly well instrumented by accounting sotware andCPA’s and best practices have been or hundreds o years(or the sake o investment and protability), it’s much moredicult to do the same thing or Social Media ROI (whichis only a ew years old).
Why I wrote this paper, ndingUltraviolet Data Nuggets andRainbow Analytics
Over the past year I worked with Cecilia Pineda Feret
analyzing the web site and social media o the HavanaCentral
restaurant group with a ew locations inManhattan. We attempted to provide ROI inormationto the owner o the group and we regularly discussedthe challenge o tracking our eorts or the company,the brand and the bottom line. For a small business,tracking and measuring this involves looking under theradar and ollowing over the rainbow to nd the ROI.Yet, every business has a dierent pot o golden datanuggets
(or rainbow pancakes, they’re easier to fnd!), or RAINBOW ROI (Cecilia Pineda Feret coined this term inour discussions about Havana Central ROI tracking and analytics).
The usual data on the radar are easy to capture:hits, ollowers, page views, etc. These metrics aremore diagnostic according to Stratigent’s JennierVeesenmeyer
, allowing you to compare data pointsover time, and against competitors, and so on withoutnecessarily providing any actionable insight into what thebusiness should change or keep doing. Additional metricsare also required such as knowing results o eorts whichwere the most eective in bringing in sales, expanding the