The ROI Obsession

14 Oct

I recently read an article which assigned actual dollar values to social media actions. This Eventbrite blog post explains how they valued our tweets, status updates & emails:

“When someone shares an event with their friends through social media, this action results in real dollars. Our most recent data shows that over the past 12 weeks, one share on Facebook equals $2.52, a share on Twitter equals $0.43, a share on LinkedIn equals $0.90, and a share through our ”email friends” application equals $2.34. On an aggregate level across Facebook, Twitter and LinkedIn, and our email share tool, each share equals $1.78 in ticket sales. We’re seeing this number improve every week with the most recent four-week average equaling $1.87.”

Finally! A legitimate value placed on social media. And I’m not excited because we can prove that there is real ROI involved; I’m excited because now us crazy creative marketers can shove this onto the desk of our clients who’s only concern is turning every marketing dollar spent immediately into two dollars earned.

What these business owners and executives refuse to accept is that social media is NOT about ROI, it is about engagement. It isn’t about page views, clicks or conversions. It is about creating a loyal, engaged online community. What is the value of each brand-obsessed user? How much would a company shell out to purchase a large community of engaged, loyal consumers?

Look at the companies that understand social media: Starbucks, Apple, Google and even Old Spice. Visit their Facebook or Twitter page. You’ll never find Starbucks tweeting daily about products and shouting at followers. They are engaging, which most importantly requires listening.

So marketers, lets bookmark this article and send it off whenever our client starts throwing out their three favorite letters. Don’t let that chain of command of the Fortune 500 company stop you from using social media the right way. Ready, set, engage!


3 Responses to “The ROI Obsession”

  1. Dean October 14, 2010 at 5:31 pm #

    I am tired of hearing the argument that the value of social media can’t be measured and that its about engagement. Like any customer touchpoint its value can and must be measured just like any other marketing tactic. Its the only way to truly understand where it should fit among other efforts like email, AdWords, banners, offline, direct mail, etc.

    The myth of Social Media not being about ROI and only being about ‘engagement” has been propagated by Social Media practitioners who know that applying usual ROI metrics to social media would show that in many cases it just plain sucks.

    But lets say your correct. By the same measure wouldn’t the ROI of your sales team be irrelevent as they are really just building relationships right? Isn’t email just a effort to reach out people to create a relationship? Ya see where I am going? Everything has an ROI and the ROI should be applied for everything. Social media playtime is over.

    The fact is that people who says that ROI doesn’t apply to them are really saying “my ROI sucks”

    PS> Good luck getting budget from your organization with you ROI doesn’t apply to me argument

    • natashajarmick October 14, 2010 at 5:39 pm #


      Thanks for your comment.

      I agree with part of what you are saying. It’s true that being able to measure ROI is very important, and you are right, there will be no budget when there are no ROI predictions.

      However, when ROI becomes the sole focus on social media, companies begin pushing out sales messages via social media. That isn’t what social media is for. When big brands use social media to gain short term profits, they aren’t understanding the true value of social media. Engagement! Building brand loyalty! These are long term goals, that in time, will bring more profitability than a short term profit-driven social media campaign would ever be able to.

      So to clarify, I love this study done by Eventbrite. Now, the marketers who want to build this long term loyalty & engage brand users can show their clients that there is proven, monetary value. And then we can focus on building a loyal user base.

      Thanks again for the conversation! I love hearing others thoughts on what I write!


  1. Tweets that mention The ROI Obsession « Natasha Jarmick -- - October 14, 2010

    […] This post was mentioned on Twitter by Natasha Jarmick, Alltop Facebook and Natasha Jarmick, Natasha Jarmick. Natasha Jarmick said: The ROI obsession & how to deal with it: […]

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