What is Social Media?

Entries in ROI (4)


The 5 things a senior manager really needs to know about social media...

Senior managers and department directors don’t have the time to wade through a constant flood of information about how to use social media. Especially when so much social media hype and information is focused on major brands or on “viral” examples that have little to do with practical applications.

Click to read more ...


Memo to the CEO: "What is our social media ROI?"

Everyone, especially CEO's, are asking: "What is the ROI on our social media efforts?".

Here is a sample memo in reply to that question that might come from the marketing, membership or online community management departments. It also helps to illustrate how you might go about defining and calculating social media ROI.

So next time you get that inevitable email asking "What is our social media ROI?" you can be better prepared to answer that question!

p.s. Want to learn more about how to define social media goals, measures and results? Visit our events page for more info.



To:            The CEO

From:       Online Community Director

Date:        1/31/2012

Re:           “What is the ROI on our social media?”

Dear Tom,

Thank you for your email last week asking: “What is the ROI on our social media?”. Here is the answer to that important question:

Expenses: We are spending $125,450 on our social media efforts based on a.) 1.2 FTE’s  - $95,450 (includes pension and taxes) and b.) applications and tools - $25,000 for our private social community network application and $5,000 for subscriptions and applications we use to track and manage our social media programs.

Revenues: We have realized $156,250 in sales as a direct result of our social media campaigns based on our tracking:

  • Membership – Improved member recruitment, retention and renewals by 1% = $34,500.00
  • Registrations – A 5% bump in conference registrations this year from our social media campaign which equates to an incremental increase of $116,250 in revenue.
  • Certification – Our Twitter campaign to promote the certification study course produced sales of $5,500.  

Cost Savings: We were able to substitute social media campaigns for some of our traditional marketing expenses, saving us $22,000 as follows:

  • Direct Mail: Eliminated 1 direct mail piece at a savings of $10,000
  • Display Advertising: Dropped 1 display advertising piece at a savings of $12,000


Based on the above we realized a total of $178,250 in revenue and savings compared to an investment of $125,450 yielding a net positive return of $52,800.

This means the positive ROI for our social media is 42.1%      

Let me know if you need more information or detail!

Online Community Director     

Want a PDF copy of the Memo?



Is your social media project doomed to failure?

This is going to be a very brief post on why most social media projects are doomed to failure.

Most social media initiatives will fail for one or more of the following management errors:

  • No clear objectives
  • No clear measurements
  • No one person accountable
  • No budget or resource allocation
  • No sustainable business model (ROI)
  • No senior management buy-in or support

One could write a book about how and why a social media project might fail.

However, I feel these 6 short sentences say it all.

What do you think?


Twitter...Bla, Bla, Bla!


The more I speak with association managers, marketing and communications professionals, senior executives and CEO’s, one message is absolutely clear. They feel bombarded by the hype around social media and frankly are getting sick and tired of hearing about it!

At a recent meeting of about 100 communications and marketing specialists (the kinds of people that are embracing social media) more than 95% of them have used TWITTER and 100% of those have determined that it held little to no value, or worse, was a time suck.

An Executive Director of an important trade association summed it up best when she felt that social media hype was exerting a tremendous amount of” peer pressure to embrace social media” but that it was difficult at best to see where the value is. Her view was echoed by colleagues and they wanted to know, where is the measureable ROI in social media?

These frustrations are both normal and unfortunate. Social Media has a great deal to offer organizations of every size and type, but the heavy focus on social media technology features, rather than the business strategy of how and why to use social media, is the problem.

What good is it to know that ‘Beyonce’ has half a million followers on TWITTER? What lessons are learned for a professional membership organization that Susan Boyle’s combined YouTube hits now number over 100 million? Or that Facebook has 330 million users?

It is like saying that China has 1.4 billion people so therefore it makes sense to do business in China. Maybe it does, maybe it doesn’t, but you do not decide just because of the impressive numbers.

Some organizations are starting to wade through the hype and make real, measureable use of social media. These organizations have several things in common:

  • They have identified a specific use or objective for their social media activities
  • They have determine how they are going to measure success and they start that measurement right from the beginning
  • They have developed a strategy and a business plan that includes designating sufficient human resources to implement and manage their plans.

In other words, they are treating social media as they would any other important business project, not like it is a hobby.