So what company isn’t interested in increasing their revenue while significantly decreasing operating costs? That’s the basic genesis of any successful functional business which is profitable. So when businesses are participating in Social Media, for those who are actively using this medium, it’s surprising that the majority of them do not know their actual return on investment (ROI) that they’re getting.
On a recent survey of online marketers who actually engage to a certain extent in social media networking, most did not have a Return On Investment attribution program set in place to track its effects.
The majority of businesses will actually just simply dismiss using social media as a valid traffic source or a conversion driver. It’s also easy to overlook that social media can be an excellent cost saving tool as well.
Measuring The Value Of Social Media Networking
At first glance, when looking at social media as a marketing source, it’s necessary to realize that consumers are talking directly to businesses, and these businesses are also conversing back to their customers. These same customers are then talking among each other regarding the companies products and services. There has to be some form of value for businesses when this happens.
So the message is essentially this, you as a business owner or an online brand marketer needs to listen to your customers as well as your employees. Take note of that information and then make an effort to use that feedback to better transform your products and your services. Once you do that, you will increase your revenue while decreasing your costs.
This is the exact situation which social media offers, although its real end value isn’t yet clear. Social networking allows you to conduct genuine authentic direct conversations with people who use or handles your products and services, which includes your customers as well as your employees.
These active conversations are the key to be able to continuously and measurably deliver the best possible product, which in effect decreases costs while increasing revenue. So anyone adopting and practicing these consumer and enterprise feedback methods can profit from them.
The Actual Value Of Social Media Networking Interaction
It’s important for a marketer or a business to take social media seriously. So if you focus on just directly improving customer service for example, the business then needs to value what each department is able to contribute to the Return On Investment on social media.
A business needs to calculate the value of their most loyal customers. These are the consumers on behalf of their brand who work as volunteers or form advocacy groups, they answer support questions, they will solve problems as well as come to the brand’s rescue if it happens to come under scrutiny.
So along with your social-media team, these loyal supporters of your business are able to create additional cost savings to your business. One example would be that you can calculate the exact savings from the reduced customer support or the call-center volume. Something like this may not be the same as a “sexy” video about your product that goes viral, but the “real money” cost saving can quickly add to the bottom line.
Developing Loyal Customers
Often a customer support center will answer those questions regarding a new product or offer, or an ad which some customer happened to of seen. These marketing queries and Public Relations answers regarding what to purchase along with how much something will actually cost, along with technical questions on how to use a particular product or service are all expenses.
These customer service personnel are not just fielding phone calls for just one department, but usually for a variety of departments as well. So Return On Investment can be calculated by factoring in the volume of all the different components. Using social media can directly as well as indirectly reduce this call-center volume effectively, along with the technology that’s needed and the labor costs as well.
Social Media’s Return On Investment
So what is the bottom-line when it comes to social media and its Return On Investment. First of all, don’t let anyone tell you that ROI doesn’t exist in social media. These calculations are just one example of what is possible. Whether it’s the value of social media and it’s relationship to PR, product or marketing innovation, if it’s done properly, the value can actually be calculated.
Although calculating the value of saving is obvious, it’s not always necessarily that easy. To do this, you need to have a solid understanding of what components makes a business successful. You need to understand how social networking works along with the dynamics of how using social media can affect the businesses bottom line.