Irfan Kamal SVP, Digital/Social Ogilvy

Integrated Social Media: Business Impact Study 2011

Dr. Walter Carl Founder and Chief Research Officer ChatThreads

Emerging Hot Topics Part I – #4

#ARFAM6

The New, More Pointed Questions

• Social is no longer an afterthought: It’s now where many of our customers spend their time.

• We need to plan budget allocations in 2011 and 2012 around concrete business goals. To that end:

1. Can social media impact sales (spend / consumption)?

2. Which channel combinations are the most effective?

#ARFAM6

Situation

• Can social media impact sales?

• Two recent studies with conflicting results

–  (+) Edison Research 2011: 24% of surveyed social network users cited Facebook as an influencer of their purchase decisions

–  (-) Forrester/GSI Commerce 2011: Social networks drove <1%

sales – based on directly traceable effect/referrer

#ARFAM6

Objectives

• Evaluate the purchase impact of social media, by itself, relative to and in conjunction with other channels

• Social media = Facebook (brand page or feed item) Twitter (brand handle or tweet) Online video/Youtube or Facebook Online rating/review Blog

#ARFAM6

Methodology: Overview •  Category: Quick Service Restaurants (QSR), including the

following 5 brands: KFC, McDonald’s, Subway, Taco Bell, Wendy’s (analysis was category and brand-specific)

•  Data (from ChatThreads BrandEncounter™ Platform): Real-time capture of brand touchpoints reported via mobile device (SMS) or Web browser companion button for 7 days, surveys pre/post touchpoint tracking

•  Recruitment: Screened for recent QSR visits; active on social media within the past; QSR brand fan/follower status

•  Participants: 404 participated on rolling 7-day basis, submitting 5,623 touchpoints between 1/20/11 and 5/6/11 (2 staggered time periods)

#ARFAM6

BRANDS Findings Preview: Significant Touchpoint Examples

OOH report examples:

BILLBOARD: [McDonald’s] great billboards with a smiling face that spells out outrageous values

BILLBOARD: [Subway] made me want to buy it

Social media report examples:

FB BRAND FEED: “[Wendy’s] face book post on my wall the burger looks good – ‘Just a friendly reminder that our burgers are made with 100% pure ...’”

FB FRIEND STATUS: “Friends been out at KFC and enjoyed a delicious meal.”

BLOG: People that love taco bell are just blogging at their experience there and people who work there are commenting on how much their company is hiring because of the need for jobs.

REVIEW: This person here really loves KFC and goes there weekly.

#ARFAM6

Key Methodology Observations

• To attempt to minimize the impact of fans/followers who already spend more than others, we looked specifically at the relationship between touchpoint exposure and pre- and post- changes in purchase (consumption, spend)

• We looked at a short time frame (1 week) to focus in on the immediate impact of the touchpoints

• Only statistically significant (95% CI, p<0.05) results are reported

#ARFAM6

Results Preview: Exposure

#ARFAM6

Results: Exposure Volume QSR Media Touchpoints

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

0.90

1.00

TV ad Word of mouth

(roll up)

OOH Social media

(roll up)

PR (roll up)

Radio Online (roll up)

Print (roll up)

Search Website

Inde

x  

Source: ChatThreads BrandEncounter™ QSR Study. n = 5,623 touchpoint encounters. Participants n = 404. Q1-Q2 2011.

#ARFAM6

Results Preview: Spend

#ARFAM6

Findings Preview: Does Social Media Impact SPEND TREND?

YES.

*Compared to people unexposed to these touchpoints

Social media (KFC) +7x

Social media + OOH (Category)… +1.5x

LIKELIHOOD OF A SPEND INCREASE IS 1.5-7X*

EXPOSURE:

#ARFAM6

Findings Preview: Does Social Media Impact SPEND AMOUNT?

Social media + PR (Category)

YES.

WEEKLY SPEND

AMOUNT

+17%

#ARFAM6

Results Preview: Consumption

#ARFAM6

Findings Preview: Does Social Media Impact CONSUMPTION TREND?

*Compared to people unexposed to these touchpoints

Social media + TV ad (Wendy’s)… +2x

Social media + OOH (Category)… +1.5x

YES.

LIKELIHOOD OF A CONSUMPTION INCREASE IS ~2X*

EXPOSURE:

#ARFAM6

Findings Preview: Does Social Media Impact CONSUMPTION FREQ?

*Is the magnitude significant enough to be managerially important?

7 DAY CONSUMPTION FREQUENCY

? UNCLEAR*.

#ARFAM6

EXPOSURE

+17% increase in spend (category)

Social+PR Exposure

2x greater likelihood of higher consumption (Wendy’s)

Social+TV Exposure

7x greater likelihood of higher spend (KFC)

Social only Exposure

1.5x greater likelihood of higher spend or consumption (category)

Social+OOH Exposure

3x greater likelihood of higher spend (Taco Bell)

TV only Exposure

QSR Findings Preview Summary: Social Media Purchase Impact

#ARFAM6

QSR Study Preview: Conclusions

•  Social media, particularly when combined with OOH, PR or TV exposure is associated with significant purchase shifts across QSR –  +17% week-on-week spend amount increase –  ~2x higher likelihood of consumption increase week-on-week –  Multi-channel matters! Only 1 significant result by itself vs.

4 significant in combination with other channels

• Relative to exposure, social media appears to provide strong impact –  Evaluate driving purchase by increasing exposure to social +

OOH/PR/TV combinations

#ARFAM6

QSR Study Preview: To Explore

• Data across other industry sectors

• Data across online or hybrid sectors (e.g. e-tail)

• Data across extended time periods, to capture longer-term effects (e.g. for TV ads)

• Correlation with specific brand activities within social media

• Larger sample sizes to look at finer interactions

#ARFAM6

Thanks, and for More…

• Irfan Kamal,

twitter: @irfankamal

• Dr. Walter Carl,

twitter: @ChatThreads

irfan.kamal@ogilvy.com  

walter@cha8hreads.com  

#ARFAM6

Appendix:

Data Collection Detail

#ARFAM6

Data Collection Platform: ChatThreads BrandEncounter™

Wendy’s Visited brand’s Facebook page Very positive 8:09 pm; 1/24/2011 Aberdeen, WA

Participant records brand, touchpoint and experience via SMS or browser button. Time/date is auto-stamped. Geo-located.

Pictures of the touchpoint can be added to record.

Participants can also add notes.

1

3

4

5Participant encounters a brand touchpoint. Consumers can record any touchpoint including social, TV, search, print, online ads and OOH.

SOCM

ED  

RETA

IL  

GAMING  

EVEN

TS  

SAMPLE  

400+ participants recruited through 3rd party proprietary community.

2

“I followed a link they posted on my FB wall”

All brand touchpoints captured, including social, TV, search, print, online ads, OOH (total of 21)