Brevenue – How do I measure the effect of social media marketing on my business?

Most money on the Internet is still made the old fashioned way, by providing a problem to a solution.  Resolving pain for consumers is an age old process of marketing. After listening to folks at AdTech, it’s surprising that so many are locked into what they are doing and not testing social and mobile media, because it’s not proven…

Take 5 minutes to listen to this video and case study included, and share your questions below; we are in a world driven by referral, not first contact, and this key element is being missed by so many.

Social media and mobile are being ignored by many top companies who only know how to monetize from first contact.  An outgrowth of the early Internet, this marketing by solving pain and problems drove Google’s rapid growth, affiliate marketing, and lead generation. Let me share some measures you can use to validate your social media efforts.

Step 1 Measure Conversion by Referrals, not first contact: In mobile and social, it’s a no sales first contact. People aren’t eyeballs or prospects, they are friends. Your voice is friendly, inviting them to play and explore, and refer.
The key to testing anything on social media is not to look for the sales results immediately; it’s been proven that social is not an immediate sales channel for most things, except dating. It’s the pleasure principle you are missing; they are there looking for fun, which is why rewards systems and gaming mechanics dominate (think leaderboards, virtual currency being redeemed by affiliate offers ala Zynga, group buying and deals, all of these use pleasure to drive activity and traffic away from social media).
Your key measurement on first contact is your referral numbers, how many people are referring traffic to your contest, reward driven social promotions, and offers?
Because the first wave of visitors in any social context are the experts, the curators, the evaluators, and participants with way too much time and way too little money to spend. The second wave who are invited  look for social proof from the first wave in terms of participation, comments, and excitment.  Be sure to put a gentle call to action on the top and bottom of your blog, your fan page, where people go next, and measure how many take activity by referral.
(Smart marketers are doing this by coding referrals with specific links that separate raw visitors from invited visitors, then look to the invitees to market.  In effect, the market has just delivered you people, and these are the ones you want to focus on…the metric is conversion by referral)
Step 2. Measure your Opt Ins and Repeat Traffic to your business, not just social.
While Facebook “Likes” and social media reviews give a good qualitative evaluation of your content, be sure to measure two areas from your social media traffic.  The first is opt-in conversion, how many people shared their email, downloaded your mobile app, and/or became repeat visitors to your site if traffic is your game.
Watching repeat visitors and email/mobile app conversion is an important metric, again assuming that you use this opportunity to engage and drive people to sales.  It is here that most people lose it, the bridge between the social world of pleasure driven exploration, to sifting the visitors and finding the 20% who are looking for the solution your business offers to their problem.
At this stage it is smart to ask open ended questions to weed out social visitors from real interest;  for example, a financial services company could ask, how are you saving for your retirement?  Those who are saving are invited to participate, request information as a lead, or engage in a conversion process that moves them to sale if interested. If not, they don’t respond to the question and the 80% non-participants should be segmented and used to refer other guests with a special video white paper, discount offer, or engaging question.
Takeaway;  measure your conversion on those 20% interested, and use the other 80% as referral mechanisms to keep filling the funnel. This measurement should happen in your world, either your web site, your social network, your email list, just make it outside of Facebook and other social worlds.
Conversion there is good to measure, but with activity rates of 10% for most, with interest quickly waning over time, it’s key not to get stuck in measuring how people play…measure what they do with you, and give them a clear path to do it.
Step 3. Convert to Customers: this is where your traditional measures come into play, and simply use the traffic from social and mobile media to test and track results from those mediums.  Instead of looking for home runs, look for research, customer problems, and creating a steady flow of conversion in your traditional numbers.
And while it won’t crush your bottom line just yet, if you ignore this tsunami of social and mobile traffic because all you know how to measure is step 3, well, good luck with that.
The shift is on and monetization of this traffic is a 2 step process;  what are you doing to qualify your traffic from social and mobile?  What’s worked or hasn’t for you?  Ask me your questions and I’m glad to share some specific answers.
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