General, Social Media, Work

Social Media ROI (Qualitative & Quantitative)

Social Media ROI. Every CMO’s nightmare. Lots of things happening – but where’s the ROI on this? – Is the million dollar question. Recently, I had written how my current organization used Social Media for Recruiting, and given a Case Study on Social Media Recruiting ROI. Today’s blog post is about a specific site in question – I was recently chatting with someone from one of the Top tier Travel DotComs in India, and we both converged on the same point – ‘What Social Strategies to use to take the Social Media Efforts’ of Brand A to the next level, and how do we get the Social Media ROI on this?

Personally, I believe, if your company earns its revenues, primarily – either by selling core Products and/or Services online, i.e. you’re a B2B, B2C or C2C portal – Social and Mobile is the future. It means:

  • You may have the best product(s)/service(s) in question, and a Web2.0 website – but unless there’s a Social and Mobile feature integration therein, chances are you wouldn’t make the cut.
  • Integrating Social & Mobile features requires – planning, conceptualization, preparation of work flows, coding, integration, testing – UI, Usability, Features and so on. Thus, this ain’t free and involves – money, energy, manpower and time.

On the Social front, there are 2 ways in which the efforts of a company could be classified and further studied in detail:

  1. Qualitative Efforts, Strategies & ROI
  2. Quantitative Efforts, Strategies & ROI

1. Qualitative:

This would include:

  • Building online brand presence
  • Strengthening online brand presence with already existing customers/clients (via Royalty programs)
  • Repositioning of brand (e.g. starting out as a Custom-Gift-E-Retailer to Apparel & Fashion e-Retailer now)
  • Community Management

Community Management: To have presence in as many social networks as possible is not of value from an e-commerce point-of-view. Its technically better to be selective of social networks and then optimize presence therein. Building a community around a brand is extremely vital as well in the long run, and technically, if you’re planning for an F-Commerce application in the near future, community management will definitely play an important role.

Let us assume, our Brand A has presence on via a Facebook Fan page. What are the Qualitative elements we could spot from here?

For Brand A, using a good Community Management Customer Relationship Management (CRM) platform, like, Sprinklr, or Radian6, or Spreadfast, or Shoutlet, can enable the community manager(s) of the page to identify 3 Core Areas:

1. Moderation, Handling & Escalation of:

  • Content for Removal: spiteful, malicious, inflammatory language, threats, proprietary information, personal contact information, misuse of client’s trademarks, logos, images for self promotion, unsolicited advertising or links to spam (software viruses, campaigns, chain letters, mass mailing, sexually explicit content).
  • Guess Issues: specific guest experience pertaining to using Brand A website online, product/services, stores (online/offline), team members/staff, corporate information request.
  • Brand Reputation Issues: comments arising from negative incidents, news stories, mergers/acquisitions/bankruptcies, unresolved sensitive guest issue(s).
  • Guest Engagement Opportunities: favorable brand commentary, suggestions by end-users, user-generated content (praises) etc.

2. Monitoring:

  • Community Managers can monitor discussions on Facebook Fan page(s); also does apply if you’ve an official Twitter account. Wherein you could monitor the tweets, check for any broken links, comments, retweets, private messages.
  • Also another very important usage is: You could identify, say, 500 celebrities you wish to target in India, or say, in Bollywood, and then use certain terms to monitor on their Twitter accounts. Every time there’s a mention, you can monitor the mentions, frequencies, IPs, positive or negative or neutral comments and take further action.

3. Analysis:

  • Influencers: Brand A’s Facebook Fan page has 300,000 fans. But are all these fans of equal value? The answer is NO. To identify the ‘Brand Influencers’ is the very first step of getting into the depth of Social Media ROI. By interfacing with external scoring engines and using multiple third party social ranking scores; e.g. Peer Index (Activity, Audience), Klout (K-Score, Slope, Network Score, Amplification Index, True Reach), Twitter Grader etc., it is possible to further drill down into these fans and –
    • Identify the most communicative users
    • Identify the most responsive users
    • Identify the users with most positive suggestions
    • Identify the users with most positive feedback

For most cases, all one needs for Analysis and Influencer-Identification is Social Data for fans/followers/subscribers. Which is easily available over the Net from social networking sites. Once the data has been collected, collated, further analysis can be done, mostly via their twitter handles. This Influencer-Identification is extremely important, since:

  • Specific time-bound, exclusive DEALs could be offered to them.
  • Top5 Influencers for Brand A could be felicitated in a ceremony at Brand A’s HQ. This could include – 1-Year special Deal packages, Subscriptions, Free Gifts etc.
  • Top Influencers could be made Insiders for getting access to new product/service offerings from Brand A throughout the year.

Return On Investment Key Performance Indicators (ROI KPI) will include:

  • Total number of spams identified – across Page(s), Brand(s), Pages & Brands
  • Spams Variations Index (i.e. variations in Total spams identified in more than 1 Facebook Fan page. E.g Brand A has 2 Facebook Fan pages – ‘General Deals’, ‘Airfare Deals’).
  • Spams Categories Index (i.e. spams sorted per categories – Escalation, Obscenity, Virus, Bot, Non-customer Promo, Self Promo, Sexually Explicit links)
  • Decrease/Increase in spams across the pages.
  • % of spam identified as ‘Non-customer Promos’.
  • % of spam identified as ‘Third-party Promos’.
  • Top trends identified for the week.
  • Volume of mentions on the Net – weekly spikes.
  • Increase/Decrease of Sentiment over Time.
  • Engagement Matrix snapshot (weekly, monthly, annual)
  • Brand Sentiment snapshot (weekly, monthly, annual)
  • Share of Voice (competitor analysis)
  • Top Influencers by Media Type (Blogs, Micromedia, Comments, Facebook, Forums, News)
  • Overall Conversation Analysis (review, outreach, support, sales lead, general info, company news, customer support queries)

2. Quantitative:

This, ideally refers to F-Commerce (or f-Commerce or F-commerce). Selling anything on or through Facebook is F-Commerce.

Actual Sales or Leads Generated should be, ideally, what we’re looking out for here in this section. But as we see in the later sections, a single ‘Like’ or ‘Share’ has immense dollar-value attached to it. Especially, if the person ‘Liking’ or ‘Sharing’ it is a Brand Influencer. Thus, number of ‘Likes’ & ‘Shares’ could also add immense value to the overall Revenue Generation process in F-Commerce for the Brand in question.

The most important Quantitative Social Media Strategies for generating Revenues include:

1. Social Plugins: This involves using social plugins — short code snippets that ping Facebook’s network for information about the user visiting the brand’s site. The Like Button is the most common plugin and is usually regarded as a content sharing device, but when it is used in conjunction with a product page it can provide peer support by displaying the names and profile images of people who have Liked the product — most appealing for brands is the fact that it also highlights any of the user’s Facebook friends who have Liked the product (Web Source). Easiest to implement, thus, most difficult to ascertain Quantitative values of purchase initiated by Likes.

One of the Indian e-Retailers that recently integrated Facebook Connect in their Initial Registration process is Check out the image below:

Also, another e-Retailer actively using ‘Social Plugins’ technique is Check out how I recommended the Apple iPhone 3GS product on their website, and it got immediately mentioned on my Timeline in, thus for my friends/fans to see.

2. Facebook-Initiated Selling: Brand A can create a Facebook Fan page with a ‘Browse for Flights and Book Tickets Now‘ image or rollover, which takes the user to Brand A’s E-commerce site for completing the Search, Selecting Tickets and making the final purchase. The best example here is Lady Gaga Store on Lady Gaga Facebook Fan page. See image below. When I click on the first object, it takes me to an E-commerce store hosted on Thus, as one can predict, user has to multi-task between Facebook and the E-store, purchase in E-store and then continue on their experience in Facebook. Not an excellent solution from user perspective, but, effective nonetheless for some retailers.

Additionally, from technology (or programming point-of-view), most companies having Facebook Fan pages which are using ‘Facebook-Initiated Selling’ technique to route fans/followers to an e-Commerce store for checkout and final purchase use iFrames on the Facebook Fan pages. There are two ways of displaying F-Commerce Pages on

  • iFrames (since February 2011) to display custom content in the 520-pixel middle column of a Facebook Page (the Lady Gage Store is an example)
  • Facebook application – we gonna talk about those later.

3. Facebook-Initiated Gaming: Brand A can create a Facebook application which lets users click on sections in the app to take them to different games. Simple as they are – they are created to bring out the creative side of people, and in the process either provide them with coupons or deals or special purchase vouchers. It could be ‘virtual credits’ which users can then use in a Virtual World or otherwise, on a social network and receive actual monetary benefits for the same. This is by process of virtual monetization model.

One of the pioneers and established leaders in this space is Retail and Consumer Merchandiser, JCPenney. JCPenney’s Facebook Fan Page which boasts of 2.1 million likes, uses Gaming. Click here to access their Facebook Fan page, and click on ‘Holiday’s Perfect Match‘ game which takes you to:, click on Play, and after ‘Request for Permission’ from Facebook, I was provided with 2 choices:

  • Guess what’s on a friend’s list: Choose Friend
  • Have a friend, guess what’s on your list: Build your List.

I chose a Friend of mine, and then posted the message on her Wall. As she builds her own list, I would be notified. Thus, JCPenney uses ‘a Social Gaming and Fun Way’ for B2C interactions, and therefore closing the sales. In the process, if I can predict what she’s building in her List, I can win a discount of $10 (as in the Rules of the Game!)

4. F-Commerce (complete selling via Facebook): This is as true as it gets – or will ever get. Herein, Brand A creates a fully-featured Facebook Application which enables the Brand’s fans to select, query, check, and purchase a product or avail of a service, WITHOUT leaving 100% seamless integration from user perspective. The pioneering work and closest competition in this race is between the world’s biggest Haute Couture Fashion Brands, Versus, the Travel & Tourism Industry.

The best ones to check out include:

  • Oscar de la RentaFacebook Fan page. Oscar de la Renta launched its first fragrance in 10 years — and it did so via Facebook. Michele de Bourbon, Oscar de la Renta’s head of marketing for fragrance, says that the brand’s Facebook fan base is becoming increasingly valuable to the company. And while many of those fans might not be able to purchase one of the label’s $4,000 signature cocktail dresses, many will be able to “experience the world of Oscar” through its more affordable fragrance line, she says (Web Source).
  • Marc Jacobs built a Facebook game titled Bang! You’re it!, which encouraged users to “Bang” their friends and crushes for chances at giveaway prizes.
  • E-retailer Yoox and British style magazine i-D have launched a Facebook application and contest to celebrate the styling talents of their customers and readers, respectively.
  • Jimmy Choo, a world-renowned footwear brand, is organizing a real-time treasure hunt around London via Foursquare.
  • DVF – Diane von Furstenberg Facebook Fan page… let’s take a closer look at a complete life-cycle of a F-Commerce Application…

I visit DVF Facebook Fan page, and wish to purchase a dress from there for my fiancee. So, I click on ‘Like’, and then go to ‘Wrap of the Month’ tab of the Facebook App. Select size: 10, quantity: 1, add to shopping cart, click on ‘Checkout’, and this takes me to to either Register and Checkout, or Checkout completely without Registering. Technically, this is a 99% Facebook App but not a 100% since the actual checkout and payment doesn’t take place inside

Two other companies which are more relevant to Brand A are: Delta Airlines and EasyJet. Both have fantastic Facebook Fan pages with F-Commerce Applications.

Delta Airlines: Delta Airlines has built a complete ticketing system into its Facebook Page, and while it allows the user to promote Delta by posting a general message on his or her Wall, it doesn’t do much to help the user share details with Friends involved in the trip, something that a Send Button could do nicely.

Click on ‘Get Started’ for starting the application. Note: You need to be on a US IP for the application to work.

EasyJet: EasyJet Facebook Fan page has excellent functionality as well. One can select country from drop-down list, and it automatically shows us the level of snow in those countries. Also, there’s a ticketing counter system, which is not as advanced as the previous one, but works superbly as well. We can visit snow peaks, watch a clip, click on Offer links to visit offer details on EasyJet website, and also, mimic the booking of tickets via Facebook.

EasyJet Facebook Fan page is probably most famous for the Map showing snow caps, and flight details, which can be accessed here.

5. Virtual Currency Monetization: Herein Brand A can use virtual currencies to acquire customers and leads through platforms like Facebook, Orkut, Friendster & Twitter. Virtual current monetization offers a platform that connects Advertisers (e.g. Brand A) with high quality customers through thousands of premier Publishers (e.g. Zynga, Playdom, EA, Playfish, Social Gaming network etc.) and Platforms (e.g. Facebook, Orkut, Friendster, Twitter etc.), to efficiently acquire customers. For example, Facebook credits in a Facebook game, which is the ‘platform payment option’, can be used by an end-user as thus:

Step1: Brand A’s advertisement is shown to millions of shoppers, on the Offer Wall.
Step2: Potential customer sees the advertisement, clicks on it, and reviews the ‘offer details’.
Step3: Potential customer completes the offer by redeeming the Facebook credits won in the game (usually on Brand A’s website).
Step4: Customer receives the merchant’s product (e.g. Facebook gives the customer additional free credits for shopping with them).

Technically, its a WIN-WIN-WIN situation overall.

Brand A Strategies on Facebook for Revenue Generation:

Ideally, for Brand A, I would suggest, they create a Facebook Fan page with a fully-featured Facebook Application wherein fans could:

  1. Book Flight tickets – Domestic & International (herein the important thing to keep in mind is – the user interface for the Facebook App should be identical to Brand A’s website, for seamless integration and user experience).
  2. Book Rail tickets
  3. Book Bus tickets
  4. Avail Special Offers – a special Facebook App Discount coupon provided to fans using Facebook for making the purchase (e.g. 10% OFF on price).
  5. Avail DEAL of the WEEK – a special Facebook Weekly offer available to Facebook Fans exclusively. The DEAL voucher needs to be used for purchasing Air/Rail/Bus tickets via the Facebook App only.
  6. Suggest and Win – a Gaming section inside the Facebook App wherein if you can suggest Brand A’s Facebook Fan Page to 10 friends, you get following rewards for the following:
    • You suggest 10 friends: You win 10 credit points for every friend who becomes a fan. Max credits you can win is: 10 X 10 = 100. 10 credits is INR 500. So, max you can win is INR 5,000. For 1 user, you cannot recommend page more than 1 time in 30 days. You can redeem points, while purchasing your next Flight/Rail/Bus tickets from Brand A’s Facebook Fan page.
    • Your friend purchases tickets: You will win referral credit points for every purchase your referred friend makes on Brand A, via Facebook Fan page. You will INR 200 for every purchase your friend makes using your referral.
    • You complete 5,000 credit points: You will WIN a life-time Award and Membership to Hall-of-Fame for Brand A’s Facebook Fan page. Users will have section with photo, and a small para about themselves. Special 4-Night package in Goa, including Airfare, FREE.

Technically, this is just a glimpse of the endless possibilities of Product Advertising on any Social Networking site. Owing to limited time and resources, I’ve been as brief as possible. The possibilities on other sites and promotional offers on FourSquare, Twitter, LinkedIn and others are immense as well. Social and Mobile is the future and thus, companies and brands who would not only understand but apply these principles directly into their businesses would not only survive the imminent transition from Web2.0 to Web3.0 which would include: HTML5, Semantic Web and processing predominantly on the Mobile platform, but would also establish themselves as the front-runners in their respective Industries.

Finally, in a nutshell, here’s a brief snapshot of Facebook F-Commerce numbers. You can figure out why F-Commerce is the next real thing on the Web (source):

1. First, f-commerce is already a viable retail platform

  • Top 3: The top 3 brands on Facebook (by fans) all sell directly on Facebook – Coca-Cola (24m), Starbucks (20m) and Disney (19m)
  • 2-4%: f-store conversion rates – on a par with web-stores (avg. 3.4%, according to Forrester/
  • $650,000,000: The drop in Netflix share value when Warner opened up a Facebook movie rental (streaming) service in 2011
  • 1000: Number of diapers P&G sold on its f-store in under an hour
  • 50,000: Number of retailers who have opened an f-store with Payvment
  • 6 hours: Time it took for the Rachel Roy Facebook jewelry store to sell out
  • 3rd highest: daily sales made by Rachel Roy, the day it opened it’s pop-up f-store
  • 1m+: Starbucks customers using their e-commerce-enabled Facebook CRM loyalty program
  • 1300: Number of products added every week to the ASOS f-store
  • 20%: Proportion of black Friday sales transactions on Facebook for e-tailer Kembrel
  • 7-10%: Increased Average Order Value for Facebook transactions (vs. web-store) for Kembrel
  • 5000+: customers using Walmart’s group-buy Facebook app on the day of its launch
  • $34: Amount paid for the first transaction ever to take place in Facebook at 11.50 am EST on July 8, 2009 for bouquet of flowers ‘A Slice of Life’ on the f-store of U.S. florist 1-800 flowers

2. Second, Facebook drives E-Commerce traffic

  • 6.5%: click-through rates on Facebook walls are 6.5%
  • 67% of retailers plan to use Facebook to drive traffic to their e-commerce sites
  • 25%; proportion of users who post links to other companies, products or services
  • 20%: proportion of e-commerce sales from Facebook (for Wetseal)

3. Third, Facebook customers are good customers

  • 1.5x: Facebook users spend 1.5x more online that other Internet users

4. Fourth, Facebook is where your customers are

  • 1 in 11: humans that are on Facebook (642 613 700) [Q2 2011]
  • 40%: The drop in Coca-Cola’s website traffic in the past year, but Coke’s Facebook page is up and is now the world’s most popular Facebook brand page (22m)
  • 7.9: In 2010, Facebook grew by 7.9 users/second
  • 1/3: Proportion of time spend online on Facebook by Facebook users
  • 50%: proportion of users who log on to Facebook in any given day
  • 700 billion: Minutes spent on Facebook every month
  • 80: Average community pages, groups and events to which a Facebook user is connected
  • Bigger than Google: In August 2010, U.S. Internet users spent 41.1 billion minutes on Facebook, surpassing Google Inc.’s 39.8 billion minutes for the first time
  • Nine in Ten: Proportion of US social network users who use Facebook
  • 57.1%: Proportion of Internet US users using Facebook

5. Fifth, Facebook drives word of mouth sales

  • 75%:  Percentage of Facebook users who have “liked” a brand
  • $2.52: what a Facebook share generates for ticketing site Eventbrite
  • 11: Visits generated by  a Facebook share for ticketing site Eventbrite
  • 30bn+: pieces of content shared online every month by Facebook users (web links, news stories, blog posts, notes, photo albums, etc.)
  • 90: Average pieces of content created by a Facebook user each month
  • 130: Average number of Facebook friends of a user (who receive their word of mouth recommendations)
  • $3.60: the media value generated by the average Facebook fan is $3.60/year

6. Sixth, Facebook drives loyalty sales

  • 117%: the additional amount a fan will spend on a brand compared to a non fan
  • 17%: proportion of Facebook users who say simply having the ability to ‘Like’ a brand makes them more likely to buy
  • 51%: the increase in likelihood a customer will purchase, after clicking the ‘like’ button
  • 41%: the increase in likelihood a customer that a customer will recommend, if they have liked the brand
  • 28%: the increase in likelihood that customers who ‘like’ a brand will repurchase
  • 40%: Proportion who ‘Like’ businesses in order to receive special discounts and promotions
  • 30% to 200%: increase in site registrations for sites using Facebook sign on
  • 15% to 100%: Increase in the number of reviews and other user-generated content generated when using Facebook social sign-on

7. Seventh, industry adoption of  f-commerce is accelerating

  • 76%: percentage of retailers who plan to use Facebook for ‘social commerce’ initiatives
  • 50%+: proportion of the global top 100 websites have integrated with Facebook using it’s social plugins
  • 50,000+: Number of websites that integrated Facebook social plugins (incl. ‘Like’) in the week they launched
  • 2.5 million+: websites have now integrated with Facebook
  • 10,000: number of new websites integrate with Facebook every day (with social plugins) (since April 2010)
  • 2m+: Number of sites that have integrated Facebook social plugins
  • 7 out of 10: proportion of digital marketers who have implemented or planning to implement Facebook Like feature

8. Eighth, f-commerce is future-proof retail (mobile and app platform, Facebook as the OS of the future)

  • 200+ million: Facebook users accessing the utility through their mobile devices
  • 2x: People using Facebook on mobile devices are twice as active on Facebook than non-mobile users
  • 94%: Proportion of phone users who will communicate on their handsets via social networks
  • 50%:  Proportion of mobile internet traffic accounted for by Facebook and other social networking tools
  • 70%: proportion of Facebook users who engage with Facebook applications
  • 550,000: the number of active applications currently on Facebook Platform
  • 44%: proportion of retailers who plan to use Facebook application in place of microsites for product launches and promotions

7 thoughts on “Social Media ROI (Qualitative & Quantitative)”

    1. Hi Rocio: i understood what you mean… since the hyperlinks are in light-blue color, when you print it, it doesnt come properly…. correct? hmmmm… well, its in the theme style of for the theme I am using, so unfortunately can’t change it. sorry about that! :)but overall, you get the idea.. and as for the links, just note them down on the paper. hope this helps!
      Thanks, SG

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