Social Media Marketing: financial indicators should not be the only

According to foreign media reports, the US market research firm Forrester reported in Friday that the marketing effect of social media should not only be measured from traditional financial indicators, but should be integrated into the financial, digital, brand and risk management four aspects.

Forrester says many people are focused on direct financial gains from social media marketing, but this is not true and there are many other values behind it.

Oggie Rey Augie Ray, a Forrester analyst, said that while some marketers were able to establish a linear relationship between investment and financial gain in social media, many marketers were unable to see direct gains. But that doesn't mean social media marketing is ineffective, but they don't see the benefits of financial gain.

Facebook fans, Twitter-forwarded information, site visits, video viewing, praise, and vibrant communities cannot be measured by financial metrics, but that doesn't mean they are worthless. On the contrary, these are the leading indicators that can well reflect the brand value of the enterprise, thus generating financial benefits in the future.

Oggie Rey advises marketers to measure the return on investment in social media marketing from four aspects of finance, digitalization, branding, and risk management. However, he believes that a breakthrough in the past only through the use of surface indicators for financial evaluation methods. The return on financial investment can be calculated through the use of coupons, but can also be done in other ways. He said the online pet store petco.com found: "The return rate of products with reviews is 20% lower than that without comment, and if the number of comments exceeds 25, the return rate will be 45% lower." Thus helping the company to save on delivery, replenishment and customer service costs. ”

Similarly, Oggie Rey said, "Risk management is not aimed at creating positive returns on investment, but in reducing unanticipated negative return on investment." "By estimating the probability and potential costs of PR events, companies can estimate the cost savings of social media."

As for brands, Oggie Rey that marketers do not need to recreate brand metrics in the social media age, and online brand evaluations are consistent with offline branding. Only simple indexes such as cognition, buying propensity, preference degree and brand Association degree (brand association) need to be evaluated. These indicators can be upgraded both online and offline.

The last one is digitization. Oggie Rey that this indicator is also relatively easy to measure. He pointed out that a health care products website called Swanson Tiyatien Products increased the amount of traffic generated by the search engine by raising product reviews in search engines by 163%.

Finally, the report emphasizes that not all social media marketing activities can be measured directly by financial metrics, but sometimes by the number of tweets forwarded and the number of Facebook fans.

Many marketing investments are not designed to boost financial performance immediately, but rather to create long-term brand value. The most valuable brands are not built in one or two quarters, but need to focus on building long-term relationships with customers. Smart marketers can see this long-term value and develop corresponding strategies and metrics.

Industry insiders believe that Oggie Rey is actually trying to emphasize a concept that has long been embraced by the technology industry: social media is a marketing channel worth putting in.