Social media has brought unprecedented change in the way a business markets its services and products online, as well as how it communicates to customers.
But how much of that change is being measured? From the latest industry surveys, very little, despite heavy investment. Yet with more corporations employing social media for branding, lead awareness and sales, the need for relevant metrics has become essential to successful financial performance. Books on social media have appeared, but few have dealt with metrics from an analytics framework. Until now.
Jim Sterne is no stranger to the Web analytics community. Founder of the E-metrics Marketing Optimization summit and co-founder of the Web Analytics Association, Sterne has tirelessly guided the discussion of digital marketing. Now, Sterne has created a short guide to optimizing your digital marketing called Social Media Metrics: How to Measure and Optimize Your Marketing Investment. I bought a copy to review, and feel that while the book is geared for large organizations, small business owners wishing to best manage their resources will benefit too.
Improve Your Social Media Gauge
Sterne says it best in the opening pages:
“This book is more for marketers who already know that social media is important and want to get a better handle on managing it as a serious business tool.”
And he wastes no time getting into the nitty-gritty of measurement planning. For example, Chapter 1 quotes a Web Analytics Demystified post on how to prioritize analysis around organizational requests:
- Is revenue at risk?
- Who’s asking?
- How difficult is the request?
- Can it (the analysis) be self serviced?
- When is the analysis needed?
- Why is the analysis needed?
A small business owner may not face all the aforementioned questions, but some of the questions may help apply some thought to developing a social media dashboard and asking the right questions around the three basic business goals in the book: increasing revenue, lowering cost, and increasing customer satisfaction. Although referencing many corporate sources, the book complements social media beginner references, such as Chris Brogan’s Social Media 101, and also works well on its own.
Throughout the book Sterne combines numerous references to studies and resources, such as Groundswell author Charlene Li and Web Analytics 2.0 author Avinash Kaushik, regarding blogging ROI and opportunity cost. Analytics resources like Eric Peterson’s Big Book of KPIs (a free e-book on business metrics) are also referenced.
Sterne first lays out the social media categories — blogs, microblogs, forums, review sites, social networks, bookmarking and media sharing. Chapters 2 through 6 covers the kinds of measurement used — Reach, Influence, Sentiment, Triggering Action (Engagement) and Listening — while each social media category is included where appropriate. Sterne takes time to explain what tools are available, and gives an overview of measurement results. In an automotive example, he explains how hub-and-spoke relationships can measure influence and reach via tagging URLs:
“The first step is to code the links you publish so that when the are republished and re-tweeted, any clicks can be traced back to the original tweet or post. That means a normal link like www.example.com becomes www.example.com?1234. You can count the number of times the code 1234 shows up in your analytics database to determine how far-reaching that post or tweet was.”
He then compares the tracking between subjects (power and style) in an example hub-and-spoke figure.
“You now have a clear understanding of what intrigues people most about your new vehicle. You have marketplace insight you can act on. You know how to tweak your tweets.”
This is analytic essence made into accessible language for small business owners and marketers alike.
For experiences with social media, Sterne uses familiar corporate examples, like Dell’s IdeaStorm, as well as some interesting how-do-they-do-its, like BestBuy’s use of Twelpforce to answer whatever Twitter-sourced questions appear. Other tools mentioned include Twittratr, PostRank and Nielsen Buzzmetrics, along with a resource appendix that includes more on social media metrics, a free tool summary and insights from other respected marketers such as Jeremiah Owyang.
Chapter 7 focuses on business outcomes, with an underscore that social media is best seen as a long-term investment, warning that “regardless of what business outcome you are hoping, planning and working for…social media results take time.” Suggested metrics are offered here, while Chapter 8, Convincing Your Colleagues, brings up the current analytics challenges in organizations. For example, Sterne notes the unspoken concern employees sometimes feel, in that they see analytics as more of a personal audit:
“First and foremost humans do not like being measured… ‘Accountability’ is another word for “We don’t trust you so we’re going to measure everything you do.”
Sterne then segues into an example given by a Symantec vice president which crystallizes the other challenge in introducing measurement responsibility and convincing departments of the benefits:
“Besides doing more with less, we’re asking people to add a page tag here and a reporting mechanism there. “
Sterne covers a few topics on organizational expectations and becoming a measurement leader (a recurring theme in many analytics books like Analytics At Work), though he admits at chapter’s end the topic of change management is too large to be covered effectively. Still, you will definitely learn to manage people as much as the metrics and measurement tools given.
Glaring negatives are few. The book does not elaborate on the impact of some recent online developments, such as mobile devices (I know there has been discussion in some circles regarding measurement of digital magazine articles shared), applications and location-based services such as Foursquare and Gowalla. Sterne does note this as he lays out the social media categories — “…more will appear before this book hits the streets.” However, some further consideration would have given readers insight on how to prepare for more change in a fast-moving medium.
A Useful Guide
Overall, Sterne has taken a solid tone and approach with Social Media Metrics. It explains the value of social media in a style that complements strategies for organizations large and small, for-profit and nonprofit. By any measure, Social Media Metrics is a truly helpful guide in the online marketing jungle.
Pierre: Thanks for the review. Another book to add to the reading list. 🙂 What is your measurement of blogging ROI? Do you still think that “opportunity cost” is a valid concept?
I believe it’s really tough to measure your social media efforts. Not everyone who follows you are really going to buy or sign up on what you have to offer. Most of the time, you’re left clueless and forever in the guess works. In the long run, social media can help build that trust and credibility you need for people to love what you have to offer.
Time is of great essence here in Social Media. At one level we need to be clear that immediate results are not every time the only correct way for measure. Social Media by its nature works on two levels one is engagement levels with the members and the SEO level. If we go a little deep both engagement and SEO get better with consistent efforts.They require the time factor to get established.
Pierre – You’re right that this book was written before there was *anything* to say about measuring social media on mobile devices. I suppose that’s an opportunity for others 😉 I’m delighted you found so much to praise and thank you for the review.
Dave – You are right on the money. The number of Twitter followers you have means very little in real value to the business. How many of them re-tweet your pearls of wisdom is another matter!
Harly – Another good point. Don’t forget to measure brand impact over time along with direct response!
Nice book review Pierre, I think using Twitter can be a real time waster personally but do see value if you can outsource the task of tweeting and communicating good content to your followers.
@Martin — opportunity cost is probably the easiest way for a biz owners to assess value, but there are a few others suggesting — Avinash advocated a comments per post as a measurement of engagement, though I have not seen a tool yet that automatics that measurement. Ratings within tools such as PostRank are currently the state of the art — owners would have to take a look and see if those tools fit their goals.
@Jim Sterne — It was a real pleasure to review. It’s a great book that adds to the body of social media books out there, and I am glad you focused on measurement concerns. I think measurement
@Dave – Thanks for your point.
@Harly – You (and Dave, actually) bring up a great paradox about SM. We hear so much about real-time search with Twitter, yet the benefit of the usage of Twitter can take time with respect to engaging people and enhancing online visibility. Thanks for sharing.
@James Rudy — Thanks. I hope this and the other social media book reviews (There’s another planned) are helpful to you. I think everyone is learning alot — I think it’s the open-ended social nature of it that allows some failures but also a lot of creativity.
Check out wp-stats-dashboard which will show you all kinds of social media metrics on your WordPress Dashboard.