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Is Social Media Actually Helping Your Company’s Bottom Line?

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MAR15_03_socialdaily

When it comes to business, we talk too much about social media and expect too little. It’s like the old joke about sales people: one person says, “I made some valuable contacts today,” and the other responds, “I didn’t get any orders, either.” Companies measure the market results of their sales investments. But few have measures or even have accountable managers in place for their social media investments, and only 7% say their organizations “understand the exact value at stake from digital.” Meanwhile,according to a Gallup survey, 62% of U.S. adults who use social media say these sites have no influence on their purchasing decisions and only 5% say they have a great deal of influence.

Consider:

  • The most common metrics for evaluating social media are likes, tweets, reviews, and click-through-rates (CTRs) for online ads — not cause-and-effect links between the medium and market results. The basic investment logic is typically no deeper than a version of “Fifty million tweets or likes can’t be wrong” . . . or can they? There is justifiable skepticism about this data. Farming services spike these numbers, with evidence that one in three online reviews is fake. For $50, you can buy 1,000 Likes, 5,000 Twitter followers, or 200 Google +1s. With real people, moreover, 8% of internet users account for 85% of clicks on display ads, and 85% of social media updates come from less than 30% of a company’s social-media audience. One online reviewer, Harriet Klausner, has reviewed more than 25,000 books.
  • A Forrester study found that posts from top brands on Twitter and Facebook reach just 2% of their followers (note: that’s followers, not new customers) and only 0.07% of those followers actually interact with those posts. As others have noted, people are more likely to complete a Navy Seal training program or climb Mount Everest than click on a banner ad.
  • There are, as always, opportunity costs. Since 2008, according to a McKinsey study, companies have devoted more time and money to social networks and 20% less to e-mail communications. Yet, the same study found that humble e-mail remains a more effective way to acquire customers — nearly 40 times more effective than Facebook and Twitter combined. Why? Because 90% of U.S. consumers use email daily and the average order value is 17% higher than purchases attributable to those social media.

Technology changes fast — remember MySpace and Friendster? — but consumer behavior changes more slowly. As a result, people tend to overhype new technologies and misallocate resources, especially marketers.

When banner ads first appeared their CTR was 10%, but that soon fell due to heavy usage by firms, and clutter. Research has long demonstrated that ad elasticities are generally very low, that firms often persist with ineffective ad media (because they have the wrong measures or no measures), and that companies routinely over-spend on ads (due to ad agency incentives, the fact that ad expenses are tax-deductible, and companies’ use-it-or-lose-it budgeting processes). Other research indicates that traditional offline consumer opinion surveys (when they use representative samples) are better at predicting sales than clicks, number of website visits or page views, positive or negative social media conversations, and search (although online behavior is good at tracking the reasons behind week-to-week changes in sales.)

With new media, therefore, great expectations are common and missing the goal is understandable: it takes practice and learning. But changing or dismantling the goal posts is a different story.

It’s now common to say that social media is “really” about awareness, not sales. Companies that “get” social media should be “relentless givers [who] connect instead of promote.” In fact, forget “traditional” ROI (that lovely qualifier), focus on consumer use of social media and, instead of calculating the returns in terms of customer response, measure the number of visits with that social media application. How convenient: to be evaluated with a metric without tangible marketplace outcomes. But it’s wrong, a circular argument, and smart companies should not follow this flawed business logic.

The value of any advertising, online or offline, depends on what effects it has on purchases. As Bill Bernbach, David Ogilvy, and other ad execs have emphasized, “our job is to sell our clients’ merchandise, not ourselves.” Those effects are difficult to measure, because consumers buy (or not) for many different reasons and even good ads in the right media have both carryover and wear-out effects that vary over the product life cycle and an ad campaign. But to justify an investment by activity and not outcomes is a tautology — we advertise because we advertise — not a meaningful business argument.

Even an activity measure, moreover, assumes the consumer can see the ad. Did you know that a display ad is deemed “viewable” if at least half of each ad is visible on your computer or smart phone for a minimum of one second? Data released in 2014 by comScore indicated that more than half of online display ads appear on parts of a web page that are not viewable. In response, the Interactive Advertising Bureau noted that for various reasons 100% viewability is “not yet possible,” but the industry should aim for 70%. In other words, hope that “only” 30% of your intended ads are not seen by anyone for at least a second!

Further, what we now know about shopping and social media activity says that online and offline behavior interact. They’re complements, not substitutes, and you ignore these interactions at your peril. The vast majority of communications on social media sites are between friends who are within 10 miles of each other. The same is true about the available data on buying behavior. As Wharton professor David Belldocuments, the way people use the internet is largely shaped by where they live, the presence of stores nearby, their neighbors, and local sales taxes.

For years now, we have heard big talk about the big data behind big investments in social media. Let’s see who is behind the curtain. It’s time to expect more from social media and prove it. The Association of Advertising Agencies has refused to endorse the 70% goal and wants 100% viewability, which means if an advertiser buys 1 million impressions from a site, that site must display that ad as many times as it takes to ensure a million viewable impressions. In 2014, The Economist guaranteed those who buy space on its apps and website that readers will spend a certain amount of time there. For instance, it will guarantee that a site containing an ad appearing for three weeks will receive X hours of readers’ attention — documenting, not assuming, engagement with the medium.

Other companies try to trace the links (or not) between online platforms and sales outcomes. They buy point-of-sale data from retailers and have systems that purport to match Facebook or Twitter IDs, for example, with a given campaign and subsequent retail sales for a product. The validity of these approaches is still to be determined. And the FTC has raised concerns about privacy issues and disclosure practices, and has urged Congress to pass legislation to give consumers the right to opt out. But shining light on what does and doesn’t happen here will be a good thing.

Business success requires linking customer-acquisition efforts with a coherent strategy. You can’t do that if you are not clear about the differences between hype and reality when it comes to buying and selling. And we should care about this distinction for reasons that go far beyond making even more ads more viewable. Companies’ abilities to make better use of their resources are important for society, not only shareholders. It spurs productivity, and productivity — not just tweets and selfies — is what spurs growth.

 

source:https://hbr.org/2015/03/is-social-media-actually-helping-your-companys-bottom-line

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FACEBOOK IS TESTING ITS VERY OWN DATING APP

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Yes, Facebook Dating is a real thing. And we may have just received a sneak peek.

Jane Manchun Wong — an app researcher who’s spotted Facebook features in the past, like Talent Show — posted photos from what she claims is an internal test of Facebook Dating.

 

The company wouldn’t say whether these pics are the real deal, although it did confirm it’s testing Facebook Dating internally.

Two months ago, at its F8 developer conference, Facebook shared that it was developing a dating app. Aspiring yenta Mark Zuckerberg explained it was “going to be for building real, long-term relationships, not hookups.”

Later, on its blog, Facebook dished out a few more details: “People will be able to create a dating profile that is separate from their Facebook profile — and potential matches will be recommended based on dating preferences, things in common, and mutual friends. They’ll have the option to discover others with similar interests through their Groups or Events.”

From Wong’s photos, it looks like the app will let you prevent your current Facebook friends from seeing your dating profile, thus avoiding potential embarrassment. It’ll also offer a variety of gender options, including trans man, trans woman, and non-binary.

No word on when, exactly, Facebook Dating will become available to the public. Guess you’ll just have to make do with Tinder, Bumble, OKCupid, Happn, Grindr, Hinge, and the thousands of other dating apps out there in the meantime.

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WHATSAPP MESSAGES AND SENDERS CAN BE ALTERED AFTER YOU RECEIVED THEM, SAY RESEARCHERS

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Security researchers have discovered that it’s possible for hackers to change both the content and the sender of a WhatsApp message after you’ve received it …

This includes the ability to change quoted messages, to make it appear you said something you didn’t.

CNET reports that the possibility was discovered by Check Point Software Technologies.

The firm] found that hackers can create a hacked version of the app and alter a quoted message (a past one that someone is replying directly one) to change the content or sender.

The hacker would, however, need to be part of the chat, so the vulnerability mostly applies to group chats.

WhatsApp told the NYT that it was not aware of the technique being used in the wild, and a cure would be worse than the problem.

One solution would be to create transcripts of every message exchange to verify the accuracy of every quote. Creating such a transcript is a significant privacy risk because those accounts of what people wrote to each other must be stored somewhere, the company said.

All WhatsApp messages are protected by end-to-end encryption, which means that only those within a chat would be able to exploit the loophole. Storing a transcript would effectively mean removing that end-to-end encryption.

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WHATSAPP INTRODUCES GROUP CALLS FOR UP TO 4 PEOPLE

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Times after Messenger launched the video call option, WhatsApp rolls out its new feature for conference video calling. The new WhatsApp feature is now available to facilitate the users around the globe on iOS and Android.

Distinctly, the group calling feature supports up to four people at the same time.

The functionality is pretty simple: To start the video call with one of the contacts, a button on the top right corner of the screen will let the user add another participant to call.

Once the call gets connected, an add icon appears, on the top right, above the names of the recipients. However, if the third user accepts the call their names will be separated with a comma. The feature can connect up to four people on a video call, all at the same time.

Noteworthy is the fact that this feature only works on the latest version of WhatsApp.

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