As a follow up to a panel at this year's TDMR conference, Measure Up conference chair Guy Powell was interviewed for the Next Gen Market Research blog on the ROI of social media. Read on for an excerpt of the interview:
To read the full interview, click here.
Tom: You’ve said people ask about ROI of social media much more so than other types of marketing. How do you know this, and why do you think it is?
Guy: I only have anecdotal evidence, but it sure seems that way. In my opinion the people asking the ROI question are feinting in order to hide their true concerns about the perceived risks surrounding social media. They are using it as a stalling tactic. It’s kind of like a bureaucrat or politician making the statement ‘we need to study this further.’ It’s a nice way of registering concern without having to register an opinion.
It’s unfortunate, because every study we’ve done has shown that the social media ROI is significantly higher than other marketing channels - sometimes on the order of 10 to 1 and 100 to 1. What marketers need to be concerned about is potentially being late to enter into social media. Just as the Internet was highly successful 10 years ago and the first-movers gained extraordinary returns, so is it the case with social media that the first-movers are reaping high short ROI and long term advantage. They have been able to build out their position in the social media space. This position is highly protectable and will be difficult for a late entrant/challenger to successfully displace.
Tom: I couldn’t agree more. Are there any ways that early entrants can make it even more difficult for their competitors when they later decide to enter? Also, I suppose no one wants to be seen as a copy cat, and there are certainly different strategies to build a successful brand on social media, yet I’ve seen a lot of shameless copy cat behavior lately. Do you think customers notice this?
Guy: Interesting question about defending your social media position. Not sure I know of any sure fire ways for a brand to defend its turf, once they’ve become leading first movers. But certainly they are in a good position to do so. I guess if they simply match spending and activities, they can probably maintain their relative position. Given that social media is relatively unsaturated, I would imagine there’s probably nothing a brand can do as a sure fire strategy to defend their first mover leadership.As it relates to copy cat behavior, I’m sure some customers notice. There are probably three groups of customers: There are many customers that simply focus on one brand and may not even notice the cat copying. For those that notice, some of these may say, ‘finally my favorite brand is doing it right’. Then I guess there is the third group that says, ‘they’re just copying, I’ll stick with the first mover (at least until they do something of real differentiated value).’
To learn more about social media ROI, join us in Boston, MA June 6-8 for the 2011 Measure Up Conference. Structured around integrating many fractured pieces of measurement analytics into one effective marketing strategy, Measure Up will have a specific focus on Social Media ROI. Register here.