Wednesday, March 16, 2011

Without a demonstrated ROI, executives will not consider social media a serious game changer

The social business creates greater engagement with customers.  It helps to drive excellent customer service.  It has greater understanding and insight into customer behaviors and customer needs.  But these issues are important ONLY because they help drive both the top line revenue and bottom line profitability, and in some organizations also help to achieve a mission.
So the third of the 3 key actions to convincing CEOs of the value of integrating social media into all aspects of the business is crucial:
1.       Get the executives personally involved
2.    Conduct show-and-tell education sessions
3.      Demonstrate the ROI
What is social media ROI?  The old definition, “Your business will still be around in 5 years” (Erik Qualman), is still true.  But it is incomplete.  We need to add a second consideration: 
the measure of what matters (profit…revenue…mission…) versus the resources required to achieve it
What matters and the associated cost can be measured.  We will consider some specific examples in the next post.

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