Value of Organic Social Media MarketingJim Tobin

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About Social Media “ROI”

http://bit.ly/IgROIVideo

Six models of social media marketing ROI

• The Amplification Model: – how much would it cost to buy these impressions/social actions through paid media?

• Value of Social Traffic versus Display: – how much does it cost to get a visitor to your site via social promotions versus display

advertising?

• Quality of Visitors from Social Media: – how well do the visitors being driven to a site via social media perform?

• Revenue from Facebook Fans Model: – how much incremental revenue do Facebook fans generate?

• Revenue from Social Media Marketing: – how many sales can be attributed to your social media marketing programs?

• Social Promotions Sales ROI: – how many sales can be attributed to a special social media marketing promotion?

The Amplification Model

Calculates the value of the following:

1) Facebook Organic Impressions2) Clicks on Facebook Links3) Twitter Impressions4) Clicks on Twitter Links5) Organic YouTube Views6) Blog Page Views7) Online Brand Impressions

Using Data from:A) Industry data on CPM for targeted online buys ($8 CPM)B) Industry average for cost-per-click advertising ($0.58 per

click)C) Average cost per view for promoted YouTube videos

($0.20 per view)D) Parts of “Social Equivalent Ad Value Model” created by

Tourism Ireland (http://scr.bi/KjPwEd)

In a given time period, we generated:

1) 75,442,874 Organic Impressions (Facebook and Twitter only)

2) 4,849,246 Social Actions (Links clicked, brand mentions, organic YouTube views, blog page views)

With a value of:• $2,021,627.27

On a spend of: • $1,660,000 (Agency fees and all expenses)

For a Purchase Equivalency of:• $1.21 for every $1 spent

Value of Social Traffic versus Display

http://www.ignitesocialmedia.com/social-media-stats/social-media-campaigns-vs-banner-ads/

Quality of Visitors from Social Media

Description Display Social DeltaPages per Visit 1.57 2.84 Social = 1.8x more visitors

Time on Site 0:40 2:18 Social = 3.45x more time on site

Bounce Rate 81.40% 45.46% Social = 44% lower bounce rate

Goal Conversions 3,098 12,603 Social = 4x more goal conversions

Revenue from Facebook Fans Model

• Social media is great at driving vast amounts of conversation. Conversation that gets seen. • Facebook fans are better advocates, and better customers, than non-fans.

Description Number NotesNet New Facebook Fans 283,786 For a year% Likely to Consider, Fan 69% Blackberry is closest analogous brand in

this case% More Likely to Purchase Since Becoming a Fan

16% Conservative estimate from the 2011 Chadwick Martin Bailey Consumer Pulse

Price of Product $250 Fictitious, changed from actual client example

Purchases per Year 0.33 Fictitious, changed from actual client example

# of New Facebook Fans Who Are New Customers

31,330 New Fans * % Likely to Purchase * % More Likely to Purchase Since Becoming a Fan

Total Estimated Revenue (Year)

$2,584,722.89 New Fans Who Are New Customers * Price of Product * Purchases per Year

Brand A Brand B0%

10%

20%

30%

40%

50%

60% 55% 53%

36% 37%

Likely to Buy Same Brand AgainSource: Facebook

Owner + FanOwner, Not Fan

Revenue from Social Media Marketing

Number NotesVisitors to Goal Pages 4,830,827 In a given time period

Products Sold 345,324 For the same time period

Goal Pages/Sale: 13.989

Social Media Traffic to Goal Pages 27,716 Visitors from social networks, blogs, etc. who landed on one of the goal pages in the time period

Products “Sold” Through Social 1,981 Social media traffic to goal pages / (goal pages/sale)

Average Sales Price per Product $135 Revenue during the period / unit sales during the period

Revenue from Social “Sales” $267,435 Products “Sold” x Average Sales Price

Cost of Social Media Marketing $97,500 For the same time period

ROI $1.74 (Revenue – Cost) / Cost

Social Promotions Sales ROI

Number NotesTotal Cost of Promotion $195,404 Including ads

# of Goal Page Completions 34,812 Use actual if it can be tracked with tracking links. If not, measure “above baseline” during tracking period. Counting unique visitors would be best.

Goal Pages per Sale

13.989 From model above

Products “Sold” Through Social 2,489 Goal page completions / goal pages per sale

Revenue from Social “Sales” $336,015 Products “Sold” x Average Sales Price of $135

ROI $0.72 (Revenue – Cost) / Cost

Maintain Your Balance

Balanced Approach

A driver and amplifier of growth

and reach

Paid

Earned OwnedAmplified Success

The social current that carries the

message

Both a driver and benefiter of social

efforts

Ignite takes over93:1 ROI

Paid

Organic Exposures Are Better

76% Lift

28% Lift

6x More Pages

2x More Pages

Organic Exposures Are Better

55% Lift No

Lift

Organic Exposures Are Better

Take Home Messages

Jim Tobinjim@ignitesocialmedia.com919.653.2582@jtobin