[twitter]There is much debate over the value of social media as its halo starts to rise on the advertising landscape. Yes, there are many evangelists preaching similar messages of engagement, conversation, listening and embracement – but “What is the return on that investment?” is what they hear in return.
When analyzing ROI for social media, it can be summed up by a simple choice: would you rather be in Times Square or on Twitter?
There are 11 ad spaces on the buildings at One and Two Times Square. Industry estimates in 2005 pegged the rates at $200 000 – $350 000. A month. And that’s just for the space rental, you still need to build your billboard to stand above the rest of the messages blaring across the square. The innovative ticker at the base of the Reuters building at 42nd Street and 7th Avenue was a $10.3 million investment.
The salesman will tell you the return on investment from these ads comes back in huge exposure. New Years Eve alone brings more than 200 million eyeballs to the ads on the Times Square buildings as the ball drops.
That’s but one night. The rest of the year has 40 people passing through the intersections, tourists taking photos, movies being shot, MTV broadcasting live etc etc. Kodak has estimated more than 100 million photos are taken in Times Square each year.
If you want brand exposure and awareness around the world, Times Square is the peak of the advertising mountain.
HOW DO YOU MEASURE ROI?
The argument of return on investment in the impression based advertising world is often tossed in the face of those who are held to task on the ROI of social media.
I will hold it up too, but in a different light.
The ad in Times Square for Chrysler features the front of a car blasting out of a building. Does it sell cars? You can estimate/measure how many people saw that ad, but can you measure how many car sales are directly related to that exposure?
Diddy stands, fist held high, on a billboard towering over Times Square. The image reinforces the brand of Sean John, but how can you measure how many tshirts, sneakers and jeans it sells?
The ads in Times Square are not there to sell products, they’re an ego stroke to Madison Avenue. The ads say “My brand is so big I can blow a quarter mill a month on the side of a building and it doesn’t matter.”
In Hollywood the billboards lining Sunset Boulevard are less about big brands and more about movie releases. The ads are there to blast a warning shot across the bow of every competing studio. They’re there to say “Look how awesome my movie is going to be.” There’s no greater movie going public in LA vs NY, but there is a bigger studio executive audience that needs to be influenced.
Big ads are big wastes of money. Their purpose is to superserve ego. Return on investment doesn’t matter because it can’t accurately be measured.
But what if you took that $3M a year a big brand spends on a single Times Square billboard and funneled it somewhere else? A place where return on investment can be measured not in millions of impressions, but in actual sales. What if Sean John or Chrysler spent $3M on social media instead of $3M on a billboard?
TWITTER INSTEAD OF TIMES SQUARE
Tweeted Brands measures the mentions of brands on Twitter every day. It doesnt approach the 211 million impressions Diddy gets on New Years Eve in Times Square, but these brand mentions represent something greater: audience engagement.
There is a very small filter between keyboard and brain when it comes to Twitter. Those who use it, use it freely as a stream of consciousness. Flow back through the account of a heavy user and you will know them intimately within minutes. You’ll know what they think about news headlines, music, food, pedestrians and movies.
“Twitter can’t be stopped,” says the Weinstein Co.’s senior director of marketing.
The widget on the right is simply trolling Twitter for the word “love.” It shows that movie reviews, restaurant reviews, customer service complaints and praise are all flowing through Twitter every second of every day. The Church of Customer calls Twitter “the killer app for customer service.”
And that’s where that $3M we’re not spending on a Times Square billboard comes in.
Instead of of one billboard, we could hire a social media superstar team of 38 to reach out and personally affect relationships with our brand.
The math breaks down like this: $75k a year in salary (we want to attract some solid people). They can work from home, we’ll toss in a new iMac ($1200 each) and budget another $4000 for benefits and bonuses.
That’s 38 people that will monitor Twitter for conversations about Diddy, or Chrysler and facilitate solutions to complaints, or interject with thanks when a customer is praised.
What’s the return on investment? If each social media superstar could help just 2 people an hour, they would reach more than 2 800 people a week on a personal level. 2 800 in a week is millions less than 211 million on a New Years Eve, but think about the emotional connection our superstars make with the consumer versus a passing glance at a static billboard. They solve the problem and turn that complainer into an evangelist.
Best Buy is on the program with their Twelpforce. The following tv ad highlights the availability of the staff to answer and solve personal problems, all through Twitter.
When a company is remarkable and reaches out and helps you personally, you’re likely to evangelize that to your friends. It’s a positive word of mouth that will spread virally just as fast as if your complaint laid out there, unsolved. The companies that are investing in word of mouth initiatives through social media will have a bigger impact than those blowing big budgets on Super Bowl Ads and Times Square billboards. Sure, those ads get you the impressions, but what about making an impression that turns in to brand love?
Hyundai is experiencing viral brand awareness this week after stepping in to help a customer who had their car crushed by a BMW in a parking lot.
We see a lot more marketing veering towards compassion, engagement and customer experience. The shift is happening because people now have control of what they want to see and hear about and companies have to adhere to what they want or get ignored. You can become the hero like Hyundai did, or the bad guy. People like it when a company goes out of its way to make a consumer happy so I’m sure they will be getting a lot of positive feedback from the situation.
How do you measure the return on investment for social media?
That’s easy, you measure it one customer at a time.