Return on Investment for Social CRM
You will want to see if your Social CRM is successful by measuring your return on investment. Central to this idea is the customer. Customers don’t want to be picked seemingly at random to receive a sales pitch. Everyone is overwhelmed, with little time to spare. The idea that they would have the time to take calls that don’t interest them is laughable.
Customers believe that they will spend some of their time identifying the products and services they want and then they will let the salesperson educate them.
Technology has facilitated the change in the way customers are contacted. The definition of spam is an e-mail that is sent to someone without a prior business relationship or permission to send additional marketing e-mail. Brands are loathe to send to e-mail addresses from a purchased list. In addition, the CAN-SPAM act has alerted brands that you don’t want to hear from them unless you grant them permission.
A key to understanding how managers move from an old sales paradigm to a new social one is the issue of return on investment (ROI). Companies often have a hard time quantifying the return they get from participating in social media.
For example, how does a business manager calculate ROI for the amount of time a salesperson spends on Facebook? If she sees no direct sale as a result, does that mean the time was wasted?
Managers are used to tying revenue to campaigns, so it stands to reason that they would want to do the same with social media campaigns. Managers want to be able to look at statistics like “20 percent increase in Likes on Facebook” and attach a revenue number to it.
The problem is that it’s hard to quantify the value of a recommendation or a positive comment. Clearly that’s not possible in the same way sales data is quantified.
An infographic called The ROI of Social Media (created by MDG Advertising) is published here:
According to the infographic, managers are looking beyond the usual sales metrics to measurements like:
Increased ability to close business
Establishment of new partnerships
A drop in marketing costs
Improvement in search engine ranking
When you look at the social media data that way, it becomes a tangible way to value the activity. So the question becomes tying social media to lead generation by looking at how the social media buyers determines what they will buy.