Having just completed a two-day session with marketing professionals in Bangkok, I wanted to share a perspective of how online social strategy and ROI figure into this part of the world. What I came away with was the understanding that digital marketers here are in no way behind vs. their western counterparts.
What is most obvious to me is that social elements in marketing should not be considered apart from the traditional, non-social elements. Second is that the return on each part of the marketing mix can actually be measured pretty well – the social is actually the easiest part of it. Today with the tools, tactics and technology at our disposal, we can definitely get the answer to these questions about what’s working. The next question that seemed to come up then was “should the investment be made to measure ROI?” Imagine it cost $20 to find out that a marketing campaign brought in another $5 in incremental revenue? The investment in measuring the return on the campaign would just not make sense – it’s a question then of can we afford the ROI data itself?
What we’ve seen is that most marketers simply put no budget into measuring what the effectiveness is of the marketing effort at all. Larger CPG or FMCG marketers appear to be spending 5% to 8% of their marketing budget on just getting the data and putting the tools to work to help determine what’s actually working, but other companies (small, medium & large alike) just are not getting data on what is actually working in their marketing. Keep in mind that this is the investment set aside for just getting the data and putting in the tools and systems to know what is working – nothing on the actual creative or media buys. Compare this for a moment to how much finance invests in measuring cash & cash flow in their relationship with banks – much more than they spend on finding out what marketing is actually working. Seems a little backwards doesn’t it?
What we began with, as a class was a desire to connect social media marketing investments to data that helps with funding and increased investment in marketing and what we end up with is a well developed understanding that the ROI of all marketing is where a company really needs to start – not one media type vs. another – all marketing should be measured.
What I’ve also seen is that demanding a return on just the social part of a marketing effort has dropped off in 2011 vs. the last few years and investment in online & social media is growing. What I am looking for is that we’ll see is a demand for ROI methodology in marketing overall – it might not manifest, but to their credit, marketers appear to be more interested in being able to state clearly the impact on revenue of all their efforts.
How ready are marketers to pursue an ROI-based strategy? An indication of the readiness of marketing in being able to connect their marketing with revenue was the answer to the question of “how many of you can produce within 1/2 an hour, a spreadsheet of current and past campaigns?” It was an illuminating response for sure – most could not. This is the kind of response we seem to get from marketers regardless of location; when we narrow it still further to just social campaigns the response is even more sparse.
Where to go from here? I for one am happy to be carrying this question forward and to be an evangelist for marketing and social media ROI. There’s not a quick, single post answer to the question, but rest assured, there is one – welcome to the journey.