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Can we measure ROI in social media? – Part 2

ROI in SM part 1: a cartoon of a round medieval tower surrounded by a moat with a drawbridge. Three people are standing on the roof where a flag waves. The wall of the tower is covered with a white grid that holds numbers, like a spreadsheet.In my post Can we measure the ROI in social media? – Part 1 I argued that it’s pointless to try and calculate ROI in social media. If convinced you might ask, “In that case, how can I justify the allocation of resources towards social media marketing?”

Perhaps the following will help.

As I previously explained, the problem with applying classic ROI to SM marketing is we can’t quantify the Return monetarily. This is because we can’t tie increases in sales or profits directly to specific social media actions or programs. This inability blocks us from talking about ROI at all.

But wait—surely what we really want to do is to make decisions about allocating resources amongst different marketing channels? Since we need to market our products and services, the real question is how and where do we spend our marketing budget. Here’s David Meerman Scott again, emphasizing this point in his usual forthright fashion.

So why not use a slightly different metric, one that allows us to compare the effectiveness of different marketing channels in ways we can measure? Let’s call it the Relative Return On Investment (RROI). RROI sidesteps the problem of assigning a monetary value to Return. Instead, it concentrates on providing a practical comparison between investments allocated to specific marketing channels and our desirable and measurable marketing outcomes. (For example: increasing traffic to websites, new product suggestions, time spent on sites, active memberships, or brand mentions.) In effect, we’re replacing Return with the changes in concrete metrics that we believe are important to our marketing objectives. The units of RROI are then [change in metric] per unit of currency invested, e.g. an increase in daily page views per dollar, or a decrease in weekly customer support calls per euro.

Using RROI we can do experiments and make decisions about where we want to allocate marketing resources. Our experiments won’t be as precise as those possible in the past when only targeted audiences saw broadcast marketing. But by using tagged indicators of traffic origins and existing analytics we can probably get a good sense of the relative effectiveness of alternative marketing strategies. That’s useful.

Be aware that using RROI in this way won’t tell you how much you should invest in marketing. That can be answered by ROI analysis performed across potential profit opportunities available to a business. But if measuring ROI in social media is a fantasy, perhaps using RROI in its place is an honest reflection of what’s practically possible.

Is RROI a useful, relevant way to think about investments in social media? Or am I just blowing smoke? As always, your comments are welcome!

Can we measure ROI in social media? – Part 1

ROI in SM part 1: a cartoon of a round medieval tower surrounded by a moat with a drawbridge. Three people are standing on the roof where a flag waves. The wall of the tower is covered with a white grid that holds numbers, like a spreadsheet.

Can we measure ROI in social media?

When Samuel J Smith moved back to the U.S. from Switzerland he needed to buy some insurance and asked for a recommendation on Twitter. Having had car insurance with Progressive Insurance for a number of years, and liking the ease of accessing my policy and payments online as well as the competent Vermont representatives I worked with when dealing with several claims, I tweeted Sam this information.

Five minutes later, the following tweet from @Progressive appeared:

@ASegar Saw your tweet – we appreciate you spreading the word ; ) Glad you’ve had such a positive experience.

What can we say about the Return On Investment (ROI) for this little social media interaction?

Exploring ROI for social media

A quick Google search finds this article which explains how Progressive has monitored mentions on Twitter and other social media channels since 2008 and has a dedicated team in its call center that responds to reported customer service issues. Obviously, this initiative costs Progressive money, and the company surely knows how much. So Progressive knows the Investment part of ROI in cold, hard cash.

But what about the Return? Receiving the tweet tickled me! It increased my positive feelings about the company and the likelihood that I would recommend it to more friends and acquaintances. In addition, anyone looking at Progressive’s Twitter stream (which has ~80,000 followers) might see that I made a positive comment. But wait, there’s more! Now I’ve written a favorable blog post that will be read by more people (including you!), possibly influencing more purchases from the company in the future.

Clearly a small but classic social media success story for Progressive.

But can Progressive quantify the value of their tweet in dollars?

I don’t think so.

Why ROI for social media is suspect

ROI was originally a financial term. However, it’s become common to see it used in areas where there is no simple way to connect what happens with a financial value. We have no idea how much more likely I am to recommend Progressive because of their unexpected tweet. We don’t know how many other people will ever see or be influenced by the tweet, or how many people will be influenced by reading this blog post.

And yet, there are plenty of people writing about measuring ROI in social media.

For example, in February 2010, Brian Solis posted ROI: How to Measure Return on Investment in Social Media. This sounds like a how-to article, but Brian’s article just contains a lot of statistics that businesses have reported about their experiences, beliefs, and predictions about their use of social media, plus one (in my view, see below) weak example from Dell about its claims of increased sales through connecting with customers on Twitter. There’s no how-to, though Brian states that “2010 is the year that social media graduates from experimentation to strategic implementation with direct ties to specific measurable performance indicators.”

This doesn’t convince me. And I’ve got David Meerman Scott on my side. He once said “When someone asks me the ROI of social media, I respond with, ‘What’s the ROI of putting on your pants?'”

What is the Return?

The problem, as exemplified by the Progressive story above, is that the monetary Return on social media marketing cannot be tied directly to the efforts that are made. Now this is not true for many older forms of marketing. For example, it’s possible to test the effectiveness of mail campaigns by sending different coded promotions to randomly chosen subsets of a mailing list and analyzing the response rate. But because social media is, well, social we can’t do this kind of segmented marketing experiment!

To buy a computer from Dell, I decide what I want, go online, and look for a good deal. And that includes checking Dell’s Twitter stream. I do not follow Dell which convinces me to buy; I buy from them when I’m ready. Dell counting a sale to me through a Twitter promo as a Return on their investment in Twitter is not a justification for their investment in social media, because I would have bought from them anyway after finding a satisfactory deal on their website or over the phone. So for Dell to say, as quoted in Brian’s article, that “Dell’s global reach on Twitter has resulted in more than $6.5 million in revenue” is disingenuous at best. There’s no way the company can claim that a sale would not have occurred if it hadn’t been featured on Twitter.

Conclusions

So should we throw out the idea of calculating ROI in social media? No, not entirely. I think there’s a better way to think about what we are trying to do when attempting to decide where and how we expend time, effort, and resources on social media marketing. I’ll explain further in my next post.

Do you think you can measure the ROI in social media? I’d love to hear what you think!

Five lessons event planners can learn from the iPad launch

Seth Godin wrote a powerful post—Secrets of the biggest selling launch ever—about why Apple sold 300,000 iPads on the first day of the iPad launch. Here are five of his secrets that are 100% relevant to the fundamental challenges facing event planners today.

Seth Godin's blog illustration: the top of his head

2. Don’t try to please everyone. There are countless people who don’t want one, haven’t heard of one or actively hate it. So what? (Please don’t gloss over this one just because it’s short. In fact, it’s the biggest challenge on this list).

Designing events so that they will appeal to the least adventurous attendee guarantees the same-old snooze-fest. Event planners need to aim higher and use innovative formats, even at the risk of jolting people who didn’t expect to be jolted.

3. Make a product worth talking about. Sounds obvious. If it’s so obvious, then why don’t the other big companies ship stuff like this? Most of them are paralyzed going to meetings where they sand off the rough edges.

How many events have you attended that you still remember years later? (Or a month later?) It’s possible to create memorable events. And the best ones are memorable not because they had great content or great presenters, but because wonderful, unexpected things happened there. We know how to create events like this: by using participant-driven approaches. But we are afraid to take the risk of trying event formats that are different. Apple took that risk with the iPad launch. If we event planners won’t take the risk, who will?

6. Create a culture of wonder. Microsoft certainly has the engineers, the developers and the money to launch this. So why did they do the Zune instead? Because they never did the hard cultural work of creating the internal expectation that shipping products like this is possible and important.

Until we fully embrace the belief that it’s possible to successfully employ powerful interactive formats at our events, we’re going to be churning out more Zunes than iPads.

7. Be willing to fail. Bold bets succeed–and sometimes they don’t. Is that okay with you? Launching the iPad had to be even more frightening than launching a book…

Apple has been willing to make mistakes: the Lisa and the Newton come to mind. You can’t have great success without risking some failure.

Every time I facilitate an event I welcome the possibility of failure. Not the kind of failure where the event is a total bust—I’m not that far out on the edge—but the failure of a session’s process, or the discovery of a flaw in a new approach. And you know what? The new things I try that succeed more than outweigh the failures I experience. And, bonus, I get to learn from my mistakes!

So take some risks with your event designs. Have the courage of your convictions, trust your intuition, and be willing to make mistakes.

9. Don’t give up so easy. Apple clearly faced a technical dip in creating this product… they worked on it for more than a dozen years. Most people would have given up long ago.

We event designers can learn a lot from the success of the iPad launch.

I think we face a long hard road in changing people’s perceptions of what is possible at an event. It’s not easy to challenge hundreds of years of cultural history that have conditioned us to believe that we should learn and share in certain prescribed ways. But the rapid rise of the adoption of social media has shown that people want to be active participants in their interactions with others, and we need to change our event designs to satisfy this need when people meet face-to-face.

I’m willing to work on these issues over the long haul. Will you join me?

Expressing Our Feelings In Public

It’s O.K. to express your feelings at weddings and funerals. But when was the last time you heard someone share their feelings in public at a conference? When was the last time you did?

I go to the theater

A play, like a straight line, is the shortest path from emotion to emotion
—George Pierce Baker

Last weekend I went to “Raising Our Voices“, a local theater gala by children, youth, and adults with disabilities. I got goosebumps and a little teary. And I finally figured out why this invariably happens when I watch kid’s theater.

Expressing Our Feelings In Public: four photographs of a children's theater production
You see, when I was growing up my education emphasized thinking. Learning important facts and concepts and being able to apply them to solve problems led to high marks on tests. Getting the right answers, preferably quicker than anyone else, got me to the top of the graded class roster, displayed publicly on the school notice board twice a semester.

No time to feel

However, the educational agenda allocated no time for understanding or expressing my feelings. The only kinds of grading that occurred as a consequence of my emotions were the dramatic reprisals taken when I infrequently misbehaved. All of us in school had feelings, of course, and they greatly affected how and what we did. But no one encouraged us to talk about or explore them. It was repeatedly implied that being near the bottom of the class list would be shameful, without ever giving us any insight as to what shame was!

Over the years I’ve learned to be more in touch with my emotions. And so, when I see kids in a play, encouraged to display joy, anger, fear, guilt, shame, grief, and all the subtle variants of these basic human emotions, I’m taken back to my youth, and the little child in me both rejoices and aches for what I missed out on: the childhood opportunity to express and share integral aspects of who we are that were part of the human psyche long before the development of analytical thought.

A wise therapist friend of mine once told me that he believes when you feel that ache of simultaneous joy and pain, healing is going on.

A safe environment for sharing feelings

I think it’s important for conferences to offer a safe environment for attendees to share feelings that may come up during the event. Conferences That Work designs do this. Agreements explicitly give participants the right to speak their truth and promise privacy for anything said.

I don’t want to give the impression that Conferences That Work are full of emoting attendees who rush to share their deepest feelings with anyone they can buttonhole. Far from it. I think I’ve seen more joy and passion at our sessions than at most other events I’ve attended. But, by and large, sharing about emotional issues doesn’t happen often.

But feelings do surface. For example, when people talk about difficulties they’re having in their workplace or their uncertainties surrounding a potential career or job change. I feel happy that our event supports and encourages them to do so. And from the feedback I’ve received, I know it’s important and empowering for the attendees who have the courage to express how they feel.

Have you felt safe to express your feelings at a conference? Do you think it’s appropriate and/or important to be able to do so? Under what circumstances? And what factors make it safer or harder for such sharing to occur?

Lessons From Improv: Giving Appreciations at Conferences

We can and should be giving appreciations at meetings.

Thoughts triggered while rereading Patricia Ryan Madson’s delightful, straightforward, and yet profound improv wisdom.

“…once we become aware of the level of support involved to sustain our lives we quickly realize how our debt grows daily in spite of our efforts to repay it.”
—Greg Krech, Director of the ToDo Institute

Patricia Madson’s ninth maxim is “Wake Up to the Gifts.” Gifts? What gifts? Well, although this post is about giving appreciations at conferences, first we need a little context.

The Japanese practice of Naikan, an art of self-reflection, uses three questions to examine our relationships with others:

  • What have I received from (person x)?
  • What have I given to (person x)?
  • What troubles and difficulties have I caused to (person x)?

When I meditate on the answers to these questions for a significant person in my life, I usually quickly discover that my list of what I have received is far longer than what I have given. When you extend these questions to the things that surround and support us in our daily lives this imbalance immediately becomes apparent. I owe an incalculable debt of gratitude to the countless people who grew and prepared the food I eat, who designed, manufactured, and delivered the computer I’m writing this on, who made it possible for me to live in and enjoy this world in so many ways.

It’s hopeless for us to be able to “pay off” these debts. But one thing we can do is to acknowledge them. And that’s why I include time for appreciations at every conference.

A photograph of a gift-wrapped present. Image attribution: http://www.flickr.com/photos/min_photos/ / CC BY-NC-ND 2.0Appreciations are more than thanks. Imagine that Susan is standing before the gathered attendees, publicly thanking people, including you, Bob, for your work organizing a conference. Here are some examples of what she might say. After you read each one, take a moment to notice how you feel.

[Susan faces audience]
“The organizers contributed a lot of hard work putting on this conference.”

[Susan faces audience]
“Bob worked hard to get out the face book.”

[Susan faces audience]
“Thank you, Bob, you worked hard to get out the face book.”

[Susan points to you and then faces the audience]
“I appreciate Bob, who worked hard to get out the face book.”

[Susan asks you to come out from the audience, faces you, makes eye contact, and speaks directly to you]
“Bob, I appreciate you for working hard to create the draft face book in time for our conference roundtable, and for rapidly producing an accurate and attractive final version. This helped all of us get to know each other quickly, and gave us a valuable reference for keeping in touch after the conference ends.”

Did you find that you felt appreciated more by each successive version, and that the final version had much more power than the others? If so, you’re not alone. In the final version, Susan:

  • Invited Bob out in front of the room;
  • Spoke to Bob directly, making eye contact;
  • Used an “I” message—“Bob, I appreciate you…”; and
  • Described specifically to Bob what she appreciated and why.

Each of these four actions strengthened the power of Susan’s message.

There’s more about giving appreciations in my book. They offer a simple, effective, and powerful way to significantly increase bonding and connection in your conference community. And, regrettably, good appreciations are so rare in our everyday life that, when people receive one, they are likely to remember it for a long time.

So, wake up to the many gifts you are receiving every day! And actively, openly, appreciate the givers when you can. You will be giving a great gift yourself when you do.

Image attribution: http://www.flickr.com/photos/min_photos/ / CC BY-NC-ND 2.0

4 reasons why I pre-ordered an iPad

iPad presentation
I pre-ordered an iPad. No, I am not an early adopter of technology. My closest brush was to buy the original MacBook Pro three months after it was introduced in 2006. It’s still my current laptop.

So why, twenty-five years after I began work as an independent IT consultant who never subjected his clients to the bleeding edge, have I pre-ordered an iPad that won’t even ship until late April?

  1. Apple got the finger interface right. Yes, the finger interface. Other tablets required styluses in addition to the ten fingers we were born with. Apple built an interface for the iPhone from the ground up that worked better with our fingers than anything else anyone has ever made. The iPhone/Touch offers amazing usability on a 3” x 2” display—an incredible feat. I can’t wait to see what is going to be possible on a screen with over five times more pixels. It’s going to be fantastic, I can tell you that.
  2. I can write on the iPad. My right thumb doesn’t bend the way it should any more, and doctors have told me investigative/corrective surgery’s not worth the risk. And I never learned to touch type. (If I had, forty-five years ago, I’d have had severe carpal tunnel syndrome by now.) Anyway, I can’t thumb type on any small screen device. And even if I could, I wouldn’t enjoy writing long blog posts and emails on one. The iPad gives me the best of both worlds; a large virtual keyboard on which I can hunt and peck for quick text entry and a proper keyboard I can plug in when needed.
  3. I can stop lugging around my laptop for 99% of my trips away from the office. My MacBook Pro is a 7 lb. beast. Yes, I chose it four years ago and I’m glad I did. I wrote my book on it wherever I went, and its large screen upped my productivity significantly. But the book is published and I don’t need that big screen any more. An iPad and keyboard weighs a third as much. The case doubles as a wedge that props up the screen. Nice! Using iWork and the dock connector, I may even be able to run presentations from it (though the resolution may not be high enough for fancy speaking engagements).
  4. Application development heaven. If I still developed software, I would be dreaming up applications to run on the iPad. In fact, I don’t like to think about what could be done with this device, because if I did I’d be tempted to ditch my Conferences That Work evangelism and delve into building a killer app for this platform. (I’d probably make a lot more money too.) Well, I’m not going to develop apps for the iPad, but a lot of people are. And they’re going to create a second cycle of revolutionary applications that are an order of magnitude more impressive than the thousands of significant apps that exist now. Am I sticking my predictive neck out here? I don’t think so.

These four reasons, together with Apple’s track-record (yes, I know it’s not perfect) for quality products, are quite enough to convince me to pre-order an iPad, something I’ve never done before. By the end of this year, we’ll all know how this turns out.

There’s only one downside as far as I can see. My wife is under the impression that once I get my iPad I won’t need my iPod Touch any more. But honey, I will. We’ll work it out—her birthday is coming up. I’ll think of something…

What do you think about the iPad’s adoption? Do you agree with me that the future’s so bright I gotta wear shades? Or do you think I’m nuts?

Lessons from improv: Be Average!

Be average!

Thoughts triggered while rereading Patricia Ryan Madson’s delightful, straightforward, and yet profound improv wisdom.

“The poet William Stafford used to rise every morning at four and write a poem. Somebody said to him, “But surely you can’t write a good poem every day, Bill. What happens then?” “Oh,” he said, “then I lower my standards.”
—from Radical Presence by Mary Rose O’Reilley

Patricia Madson’s fifth maxim is be average. Be average? Who wants to be average?! Hear me out.

Back in January I wrote Everyone Makes Mistakes about how many of us were taught while growing up that we had to do things perfectly in order to feel good about ourselves. Eventually, I discovered this doesn’t work. The emotional stress incurred in attempting the impossible task of being perfect far outweighs any small increase in the perfection of work, and, most of the time, that same stress leads to a decrease in effectiveness. But there’s more to being average than letting go of perfectionism.

Because being average is a great approach to being creative. Here’s how.

When we’re working on being creative, there’s an assumption that we must try to come up with something that’s different, something that’s “outside the box”. Not necessarily, says Patricia Madson, and she quotes Marcel Proust: “The real voyage of discovery lies not in seeking new landscapes but in having new eyes.” In other words, she suggests that we look more carefully inside the box.

When I was an information technology consultant, clients would often expect a shiny new high-tech answer to their problems. Instead, I usually came up with mundane but creative solutions that took the best advantage of available resources. My clients were momentarily disappointed—until they heard how inexpensive my proposals would be. (Luckily for them, I just charged for my time rather than the amount of money I saved.)

Think about Magritte’s pipe that isn’t:
pipe

or Duchamp’s Fountain:
Marcel Duchamp Fountain, 1917, photograph by Alfred Stieglitz at 291 art gallery following the 1917 Society of Independent Artists exhibit.

These artists expressed their creativity through household objects depicted in new ways.

One of the nice things about this kind of creativity is that we can all practice it using the gifts we already have. I find that dreaming up “way out” ideas is hard. It’s simpler for me to concentrate on seeing something familiar in a new way and be open to what pops into my consciousness.

There’s a delight in this kind of relaxed creativity. Be average and focus on the obvious. And, if nothing fantastic occurs to you right away, don’t worry.

Just lower your standards.

Jerry Weinberg’s ten laws of trust

laws of trust: The cover of Jerry Weinberg's book "The Secrets of Consulting"Jerry Weinberg’s ten laws of trust are shared in his fantastic book, published forty years ago and still in print: The Secrets of Consulting: A Guide to Giving & Getting Advice Successfully:

  1. Nobody but you cares about the reason you let another person down.
  2. Trust takes years to win, moments to lose.
  3. People don’t tell you when they stop trusting you.
  4. The trick of earning trust is to avoid all tricks.
  5. People are never liars—in their own eyes.
  6. Always trust your client—and cut the cards.
  7. Never be dishonest, even if the client requests it.
  8. Never promise anything.
  9. Always keep your promise.
  10. Get it in writing, but depend on trust.

Ten laws of trust. Obey them, and transform your consulting!

P.S. For more gems from Jerry Weinberg, check out his 19 Secrets of Consulting that Changed my Life and his Ten Laws of Pricing.

Conference facilitation lessons from improv: Say Yes!

Say Yes!

Say Yes: photograph of a large group of workers wearing blue shirts striking dramatic triumphant poses outdoors. Image attribution: http://www.flickr.com/photos/feastoffools/ / CC BY-NC-SA 2.0

Thoughts triggered while rereading Patricia Ryan Madson’s delightful, straightforward, and yet profound improv wisdom.

Patricia Madson’s first improv maxim is “Say Yes!” This reminds me of a harrowing incident not so long ago…

Will this closing session achieve closure?

I was facilitating the closing session of a three-day West Coast peer conference using a fishbowl format. It wasn’t going that well. People were eager to talk, but instead of a conversation developing we were jumping disjointedly from topic to topic.

And then things got worse.

“Selma”, a senior state official, began to speak. Listening, my heart sank as she shared that the conference had failed to adequately involve the significant numbers of minority and low-income attendees who were present. I felt shocked and dismayed. The conference organizers had made heroic and successful efforts to make it possible for a wide variety of people to attend, so Selma’s verdict seemed like a serious indictment of the conference process we had used, a process for which I was responsible.

Looking around the room, it was clear that people were upset by what they had just heard.

Then things got even worse

Instead of responding to Selma’s comments, “John,” the next person to speak, started talking about something entirely different. I felt the credibility of the session shrink rapidly toward zero. People were disengaging. We couldn’t even face a difficult issue head-on—instead, we were going to avoid it and change the subject!

John finished, and I knew we were at a tipping point. And if, as an exercise, someone had described the situation and asked me what I would do, I would have drawn a complete blank.

But this wasn’t an exercise.

What could I do?

Somehow, at that moment, I accepted the situation and acted from my gut.

“John,” I said, my voice quavering a little, “please excuse me, but I feel we need to talk about what Selma just said. If we don’t discuss the issue she’s brought up, then I think we are all going to feel pretty dissatisfied with our time together today.” I turned to Selma. “Selma, I want to hear more about how you think we’ve failed some of the attendees at this event.”

That was enough for Selma and the group to enter an intense discussion of the issues she had raised. There was no more rambling conversation. Though the resulting dialog was difficult at times, the tension in the room subsided as the participants shared and felt heard. The session became an authentic reflection on tough topics, a fitting end to a conference that had raised more questions than could be fully answered in the time we were together. And that was just fine with me.

I said yes

I’m proud of how I responded at the crucial moment. In Madson’s words, I said yes to the situation and responded from my authentic self. It wasn’t easy for me. It would have been safer to say nothing and let the group ramble on disconnectedly. But amazing things can happen when we say yes to the challenges that come our way. Try it!

P.S. If you’re interested in the inspiring organizational and cultural consequences of saying yes, I wholeheartedly recommend Peter Block’s great book, The Answer to How Is Yes: Acting on What Matters.

Have you said yes at a difficult moment? Share that moment below!

Image attribution: http://www.flickr.com/photos/feastoffools/ / CC BY-NC-SA 2.0