The Social Media ROI Acid Bath – Harmful If Swallowed (response to Tim Walker’s post)


  • By all means, keep asking, “How will we know when we win?” Social media deserves as much discipline as any other area of business.
  • In those areas where you can measure ROI connected to specific social-media efforts, by all means do so. ROI is a useful tool — a fundamental tool — when it’s used right.
  • Understand that, sooner or later, social media will probably become as pervasive for your business as e-mail, phones, or face-to-face communication. That’s neither good nor bad — but it’s a good idea to be ready for that day before it’s staring you in the face.

(and the final hook: “Your thoughts?”)]

I love this discussion.

I think we need to dissect “social media” for a minute. To throw all of the types of social media into the SM bucket is a little like trying to find the ROI of “marketing.” Talk about being able to move the numbers around as you would like… So let’s talk about the specific forms of social media engagement and see how they develop or come into focus in the acid bath.

Exhibit A: Twitter. (The poster child of a revived social media revolution. Heck even Oprah’s into it, at least for the month of April she was.)

Can Twitter have a positive ROI? Yep, pretty simple example is Dell’s Outlet tweet. Spitting out coupons and deals 24/7 to a growing number of followers. And Dell claims over $1m in sales at this point. (i) low, (r) high. Innovation level = 0. Nice to be early into the process, but there’s nothing innovative about using a new social media platform as an RSS feed or broadcast channel. As massive numbers of legitimate companies and scammer schemes hit Twitter to follow Dell’s success, we are beginning to recognize the value of a single tweet. Or, as the case may be, not recognise the uniqueness of the tweet and instead drive the value of Twitter as a “channel.”

Twitter Verdict: Investment – almost free. Does take time to build followers, but there are games and systems to help you reach critical mass without much “original content” necessary. Return – as an RSS channel for business Twitter has fine stats. For people interested in subscribing to businesses Twitter feeds, I suppose the value is in the eye of the beholder. But the principle of Twitter is not as a broadcast channel to pitch your deals and contests and MLM business opportunities. Well, okay, it IS for that if that’s what you are looking to do.

But the value of Social Media definition of Twitter is about relationships and connections. “I follow you on Twitter,” is a common refrain at networking events. And people are much more likely these days to give you their Twitter ID rather than their email address, often event attendees have written their Twitter ID on their name tags. I am John Mac, but I am also @jmacofearth.

The value that I see in Twitter is in the one to one connections I can make with people and in the value that I try and provide by filtering good and relevant content to my “followers.” I work at creating and hunting down good content for the people who read my Twitter stream. And as Tim O’Reilly said recently in his Twitterbook talk,

  • In social networks you gain and bestow status on those you associate with
  • A key function of a publishing brand (that’s your personal Twitter brand) is the bestowal of status by what you pay attention to
  • If you only pay attention to yourself you are not as valuable to your community
    • You don’t learn as much from your readers
    • You don’t bind them to you by amplifying their voice

An excerpt from my capture of the Twitterbook chat: Twitter Notes and Ideas from Tim O’Reilly #Twitterbook on Fluent Search

Exhibit B – Facebook and Facebook Apps. Again a good example of embracing social media on Facebook comes from Dell with their Social Media for Small Business page. With over 33k fans. That’s certainly success in terms of numbers. And to their credit, Bob Pearson, former VP of Communities and Conversations for Dell, set up this Facebook “community” with success in mind. It is perfectly done, for a Facebook page.

But as a FAN of this page, what do I derive as a member? Well, they have links to some interesting content. And Dell team members are constantly pushing up questions and discussion topics for the fans to participate. But is there much “social” going on within the Business pages of Facebook? In terms of pure numbers I would say, Dell’s Facebook page Social Media for Small Business is more about showing up at the conversation rather than driving business. Perhaps a halo effect is created when visitors come to this page and get resources they can use. And with Dell’s recently stepped up advertising spend on Facebook (their ads are popping up on almost every page for me) perhaps the “social” aspect warms prospective customers to the Dell notebooks over the HP notebooks. Perhaps.

Facebook Pages and Apps Verdict: Investment – high to low, depending on what you want to build. Return – hard to calculate the value of traffic on Facebook. Dell’s ads are spread far and wide across all levels of Facebook. And certainly there are a large percentage of Facebookers who own small businesses and thus interested in Social Media for Small Business, but as far as community goes, I have not see a Facebook community thriving in any setting. Facebook as a whole is a community of sorts. But Apps and Business Pages on Facebook seem to be more about showing up rather than showing value.

Exhibit C – Corporate Blogs.

The mother of social media is the blog. Everything else has come in the wake of this discussion-based platform. And it is impossible to discount the value of a corporate blog done right. See Oracle and AMD. For both companies the technical blogs anchor the discussions throughout their entire site. Processors, Tech Support, Technical Specifications, Engineering Input and Q & As are all part of the social media web anchored by the blogs. Forums and Discussions like specialized conversation rooms for topics spun out of the blogs.

And the poster child for NOT doing a blog at all?


about Apple footer sitemap
about Apple footer sitemap

And how can Apple stay out of the blogosphere? I assume it is the number of fan-based and industry-based blogs that cover Apple for Apple. Not a strategy that many companies should try and emulate, Apple does not support it’s own blog. Heck Microsoft is blogging the crud out of the social media space, and Apple just chooses not to show up? Amazing.

But one statistic that give credence to Apples approach, corporate blogs have an honesty/trust rating in the 20% range. Yet I would argue that that number goes way up once you are inside the deeper blogs. For example, AMDs area on microprocessors and battery life, where the engineers and technical communities are discussing what should be done to create a common measurement system, would most likely garner a high trust value, because it is a conversation between AMD and it’s customers and not a pitch piece gussied up to look like a blog.

Corporate Blogs – Verdict: Investment – Low to Start but High to Support. Just putting up a blog and dressing up press releases will not gain your company much in terms of Return. In order for a Corporate blog to be effective it has to be open and frequently updated. The top executives don’t necessarily have to post or comment, but someone other than the marketing department has to speak as experts in their areas of the company. If it’s an engineering question it is critical that an engineer be the author responding. And you can’t just tack on this new responsibility to your staff. “BTW: Please check the blog daily and make comments.”

An example from a while back where a visionary of a company put down his rationale behind “showing up at the conversation and engaging the customer.” It was a well-articulated vision of how corporations had to take social media seriously. So the post goes up and within a day there are several well-articulated responses. And one of them in particular was very accurate in pointing out some of the flaws in the said CMO’s visionary mission statement. I stumbled upon the post a week or so after the initial flurry of activity and the CMO had not responded.

So here was a “visionary” talking about showing up at the conversation, where ever it takes place, and engaging in the discussion, and yet… NADA. I wrote to the social media team asking if this executive would be responding… NADA.

So the CMO had delivered a monologue rather than a dialogue. Too bad that the topic was about the vision of dialogue.

Exhibit D – Personal/Professional Blogs

If you are not blogging what are you doing? If you can’t think of enough topics to keep your pipeline of ideas full you are not participating in the social media universe you are merely grazing across the top of what’s out there.

In the current climate, if you are pitching yourself as a social media “anything” you’d better be participating in the process. If you’ve yet to jump in, there is no harm in that, but jump you must. Standing on the sidelines of social media and trying to comment or make sense of it, is like trying to describe the elephant by blindly holding on to the tail and making projections about what the elephant is.

So if you don’t have an opinion about anything social, start by getting involved somewhere online and seeing what takes place. Personal observation is the heart of blogging. Here’s why this works, here’s why this is lame. Here’s a great link about flying fish fillets, here’s an ROI calculator for social media. (well, here’s the Is It Worth It? An ROI Calculator for Social Network Campaigns, no endorsement from me, just the link)

Personal/Professional Blogs – Verdict: Investment to set up, free. (See WordPress, Blogger and Posterous) Return is what you put into it. But in the near future your resume will be your blog. Oh and the idea that you can separate your personal blog from your professional blog (or your personal social media stuff: Facebook pics, kids drawings, ramblings, from your professional social media stuff: LinkedIN, commenting on blogs, posting on community sites) is false. A separation barrier does not apply to Google searches. If Google dredges it up, it’s part of your resume. So think twice about that snipe, drinking pic, or rant against some political figure.

In conclusion, finally: The R on social media varies by intent and type of social media. The I also varies, but simply staying out of the game works for Apple and perhaps Steve Jobs himself, but for everyone else, you are what you write, tweet, post, comment as much as what you “claim” you do. Now go Google yourself and see what you find out about the conversations you don’t even know you are part of. And then get out there.

John McElhenney

This Post Has 6 Comments

  1. I skimmed this when you put it up, John, but it's only now that I'm really getting to read it. WOW. Lots of great stuff here, especially in the thumbnail takes on the R and the I of the various platforms/channels.

    Lots for me to think about — you know I'll be returning to this topic.

    Glad to know I helped to set off this chain of thought!

  2. Great post! This is full of outstanding information, and I concur with your assessments of Twitter and FB.

  3. Great post! This is full of outstanding information, and I concur with your assessments of Twitter and FB.

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