Tracking ROI

The other day I caught an interview with Joel Mitchell (of Twist Image) by John Janstch (of Duct Tape Marketing) on the Small Business Marketing Podcast (iTunes Link). These guys are both on the cutting edge of marketing and had lots of interesting things to say. If you aren’t subscribed, you should be. But they opined on two points that I think are really important.

1. Social media is best used as an expansion of existing marketing. Existing marketing channels aren’t going anywhere. Sure they’re becoming less dominant, and less sure fire ways to reach people (given the choice, I’ll always skip past commercials with a DVR), but they should still be a part of your overall strategy. Right now, avenues like Twitter help you to reach a certain sector of the market and advertising in the paper helps you reach another. They both bring in customers, just with different results.

Some of the more interesting ideas in this space is the ways you can integrate old media and new media. If you’ve ever seen the Best Buy commercials advertise for their Twelpforce service, you’ve seen it in action. There’s the interesting dynamic of advertising another way for you to advertise, but most people see it as an extension of your services.

2. ROI for social media is tricky, but what marketing ROI isnt? A lot of complaints are levied that Social Media investments can’t easily be tracked. Well, that’s true and false. If you set out with a specific goal in mind, it absolutely can be tracked. If you just want to see it affect sales conversions, then no it can’t be tracked. But really few marketing activities can be tracked.

Newspapers will gladly espouse subscriber and sales numbers to you if you want to buy a classified ad, but you have no idea how many people are looking at that ad. Best case you could know how many people respond if you only use that channel. But then you’re limiting yourself. Even TV commercial prices are based on fabled Nielsen numbers that have ruined many a show (RIP Arrested Development). The truth is that channels have a foggy idea of how many people watch their shows. They can tell you lots about who watches them online. They might not ever mention those who watch when it’s time shifted. But even then, you don’t really know who’s paying attention.

So when people say that social media is difficult to track, it’s true. But that’s never stopped anyone else.

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