Why is this always the hardest part of everyone’s job? Regardless of job function or industry, everyone is ultimately held accountable to the dreaded ROI questions: what defines success / were our efforts successful / what is the ROI?
What makes this topic so daunting is that there appear to be an endless array of success factors to choose from – so much so that defining what success looks like can feel paralyzing.
Furthermore, getting to a valuation of ROI seems nearly impossible when there are an increasing number of intangibles in play throughout customer experiences.
3 Steps to Measuring Success
In my 10+ years of experience, I have worked in the automotive, healthcare, banking, insurance and fashion retail industries. As disparate as these sectors are, I have learned three practical lessons that are germane to each industry as well as to the larger ROI conversation.
- Shift the Conversation
Have you ever been asked something like, “What’s the ROI of our social media program?” My favorite response to that type of generality is, “Well, what’s the ROI of your phone?” The ROI of an organization’s entire social media (or print or creative, etc.) program cannot be accurately defined, by virtue of the many disparate functions it performs. As such, anyone that is held accountable for ROI must shift the conversation. Success and return must be discussed within campaign-specific (e.g., “ROI of social marketing for BalletMet’s The Nutcracker”), channel-specific (e.g., “ROI of our Cardiac Health blog series”) or budget-specific (e.g., “Cost savings of serving customers via Twitter”) parameters.
- Align the Metrics to Objectives
What I have found to be useful is classifying metrics based on some broad buckets of objectives. The below table – while by no means all-encompassing – serves as a general guideline for the types of metrics to consider based on what customer behaviors you are trying to drive. Ultimately, if you measure something that is not an objective (or directly tied to one), you are wasting time and effort.
- Socialize Wins & Opportunities
This point brings us full circle to the notion of shifting the conversation. To keep stakeholders focused on the right success metrics, it is critical to ongoingly socialize wins and opportunities. I like to do this via email at various points throughout the life of the campaign, in addition to sending a comprehensive campaign recap at the culmination. Some people like to hold “post mortem” meetings to debrief but, quite frankly, I find those to be a waste of time. If you did your job upfront of level-setting internally and aligning metrics to objectives, there should be no need to dissect a campaign to determine what worked and what didn’t – successes and opportunities should be abundantly clear.
At the end of the day, ROI is a simple calculation – with complex and objective inputs.
Here’s what I mean…
How do you define the Gain from your investment?
Again, it depends on your campaign’s overarching objectives and your approach to measuring success: increase in digital audience size, online sales, foot traffic, brand awareness. And, while defining the investment itself may be more straightforward, it will also vary by campaign: hours, resources (personnel & otherwise), budget, etc.
The Cost of that investment can be even trickier.
How do you place a dollar value on an employee’s niche expertise or intellectual capital, for example? Hourly rate, salary premium compared with market average and replace-ability (or lack thereof) could all be used as an approximation.
You see, any campaign or level of effort in an organization will have an assortment of metrics to select when defining success and return.
Don’t get overwhelmed by this. Instead, view it as a fantastic opportunity to define success and ROI on your own terms. Focus on what you CAN measure and affect. Direct stakeholders’ attention to the appropriate conversation and show you’re measuring success based on the pre-defined goals.
Guest Post By:
Carolyn Kent brings over 10 years of experience in digital marketing to the table. She is the past President of the Social Media Club of Columbus, and currently serves as the Social Media & Mobile Marketing Manager at EXPRESS. She has also served in similar capacities for Nationwide Insurance and JPMorgan Chase. She also enjoys singing, running and cooking. Her favorite mobile app is Any.DO. Fun fact: she can do The Worm. Chat with her on Twitter @CarolynLKent.