Are You In Love or Just Doing a Trade?
Pushkar Sane | July 13, 2011
I keep hearing that brands want to build strong relationships with their consumers through social platforms. They love their consumers and want consumers to love them back. Some brands do believe that consumers love them more than anything else in life. The target audience descriptions sound mushy and brand promises sound like wedding vows.
Today, ‘social media’ is the most discussed topic in advertising and marketing circles. Marketers and admen are desperate to rub shoulders or share a panel with Mark Zuckerberg. Every second person in the industry claims to be a social media expert – Facebook expert, Twitter expert, listening expert, fans acquisition expert, social campaign expert, etc.
Every agency of its worth now has proprietary tools to tackle social, and marketers are trying to find quick solutions to win in social. Over a short period of time, the industry has managed to develop processes and methodologies for social marketing. Smart people have also invented tools to listen, engage, measure, and predict.
It is highly impressive given the transient nature of social media. All this makes it look like marketers (and admen) have really understood social and now we just need to scale it to new heights. So there enters a new character called ROI (return on investment).
In the last six months, I have seen increased focus on calculating ROI for social media. I have seen presentations, heard panel discussions, and read point of views that highlight how to calculate ROI. Some of them actually go in specifics – ROI on Facebook or Twitter or any such platform. Broadly speaking, they all follow a standard formula.
ROI = [Gains from investments – cost of investment/cost of investment
I have spent considerable time studying and understanding the issue of ROI and as it relates to social. I personally find the concept of ROI for social completely out of place and irrelevant. Most people who claim to calculate ROI for social don’t really understand the domain because social is not really about releasing display ads on Facebook or doing Promoted Tweets.
In my humble opinion, initiatives on social platforms are to engage people through conversations, gain respect, win trust, show care, and finally build a long-lasting relationship. I wonder where does ROI fit into conversations, respect, trust, and relationships. Would you calculate ROI on your personal relationship and time spent with your parents, spouse, children, siblings, and friends? Your parents gave you birth, brought you up, put up with your stupidities, pampered you, paid for your education, participated in your joyous moments, and were there for you in your tough times. Your spouse loves you, makes you happy, cares for you, stands up for you, and partners you in joys and sorrows. Your true friends accept you as who you are and not what title you carry. They hang out with you, try to pull you out of problems, and entertain you.
If you invest your time and money to nurture and strengthen your relationships, would you calculate ROI? And how? Will you spend more or less time with your parents, spouse, and friends because you don’t get enough returns from them? What returns are they getting on you? And how would you feel if your mother starts calculating ROI before she cooks your favorite food or your wife starts calculating ROI before she gives you a kiss or your son calculates ROI before giving you a sweet smile?
I’m not against measuring strength of relationships and bonds. I’m not against working on your relationships to make them stronger and more meaningful. I’m not against evaluating whether the love is real or superficial. But I’m against putting monetary value and expecting monetary returns from initiatives that are meant for relationships, love, trust, and care. In my opinion, brands need to really decide what they stand for and what they seek from their consumers.
So my humble request to brand managers is to take relationships seriously and answer the following questions truthfully:
Are you in love with your consumers?
Do you want them to love you back?
Do you want a long-term relationship?
Do you want their trust?
Do you enjoy the conversations?
Do you care for your consumers?
If the answer to any of the above questions is yes, then please stop calculating ROI on social! But if you insist on calculating ROI on social, then don’t claim you’re in love – just accept that you’re doing a trade.
Tags: Relationships, ROI
I totally agree with the non-ROI and Engagement measurement philosophy. I would also add that what we are really doing is building brands in the online space. All our efforts should be towards ensuring that the brand becomes stronger and not weaker or dissipated because of the social media efforts.
A case in point is the AXE page. It has become a cheap, soft porn FB page while the brand still sticks to its tongue-in-cheek humor style in traditional media. Social Media can be extremely harmful for brands if all you care about is ROI or even Engagement which often translates into ‘How many ‘Likes’ did this post get. Problem with that approach is that a delicious looking cup-cake can get you a 1000+ Likes on a brand page because people love cup-cakes. But does that translate into anything for the brand? Because the same cup-cake post can get the same Likes on any other brand page. What we need to focus on is a great content strategy. Content which is created around the lifestyle or the promise that the brand advocates. Posts then get liberated from plugging the brand and can become conversation pieces which connect with the audiences online. The content should be more about the audience and not about the brand.
ROI works only if you are talking to customers or targeting them. In the social media space, there are no customers. Only audiences. If you don’t entertain them, they are gone.
Thanks Prashanth for your comments.
Very interesting thought Pushkar. I think we need to look the social funnel from different perspectives. Right now, lot of marketers (in India) believe that social media is more of conversations platform. In that context, measuring ROI of conversations won’t be right. But social media is more than conversations. So, we need to set/evolve different metrics for different activities a brand does on social. And ROI in itself is not a bad concept. Only thing that marketers need to do is create different (non monetary) ROI model for social. For instance, measuring ‘engagement’ score could be one.
Thanks Kapil. It certainly requires more discussion. My piece is a thought starter.
While ROI approach may not be desirable.. It’s difficult to ignore it in a business context where there is a ‘budget’ for everything.. and there are more than one claimants for the marketing dollar. But yes till we evolve a method of correctly estimating the gains from the relationships or goodwill… the ROI working should given a pass and marketers should work on earning the consumers’ trust and ‘likes’ or ‘+1s’ ..
Sandeep
Thanks for your comments. Agree that in business there is budget for everything and there is nothing wrong in doing a trade. But lets not call it relationship building efforts in Social.
Pushkar
Pushkar… could not agree with you more….
the challenge is that in the current times when we are predominantly in the “market place”, everything is measured as a “business case” with “RoI” and “how much money you made of it”….
heartening to see that there is at least a voice that says there is more to human existence than looking at returns – after all returns are not just in terms of money and not just over a short period of time!
power to you!
Bhavana,
Thanks for your kind words & support.
Pushkar
I cannot agree more!!! Like in the old days, we used mail or telephone line, etc. How can you tell the ROI of a telephone line? It depends on how do you use the phone…
Social media is a ‘platform’ for communication. In this case, we are talking about relationship building. Similar to CRM, how do you measure the relationship that you are building? There is no quick/simple ROI formula for relationship – different companies should have different ways to measure, depending on their business goals and situation.
Thank you Joni.