Engagement is the New ROI

Social media has become serious business. Companies are looking to cost-effectively serve customers via social technology. Marketing is no longer a one-way street where brands do all the talking. The Econsultancy Social Media Report suggests that 86 percent of companies are spending more on social media in 2010 than in 2009. Big companies like Coach, Microsoft and Barilla Pasta are actively scaling social media initiatives beyond one-off marketing and communications, creating innovative ways to engage their target audiences online.

Some headlines for companies that want to leverage consumer engagement.

1. You are no longer driving your own advertising and communications.
Social media has transformed traditional advertising into an opportunity to engage in two-way conversations with your customers. By participating in these conversations, the course of them can be changed and guided. These conversations provide your customers with multiple ways to engage with your brand -“ making them your marketing channel. Recommendations from personal acquaintances or opinions posted by consumers online are now the most trusted forms of advertising, according to the April 2009 Nielsen Global Online Consumer Survey. A consumer who loves your brand will willingly contribute to your promotions and advertising campaigns. They will passionately recommend your brand to friends via Twitter and Facebook. As consumers create their own content — from Web pages to videos to blogs — and share that content with their social networks, they are shaping the way the world sees everything, including perceptions about your brand.

2. Connecting your consumers connects you with your customers.
People want the ability to connect with each other, not to companies. The best online campaigns facilitate those connections, giving people stories to tell and something to talk about, building permission-based relationships and learning along with your most engaged consumers. Interaction is more powerful than passive consumption. Interaction increases consumer interest in your company’s products and services. The effect is exponential. During Barilla’s recent “Share the Table” social media campaign, 400 loyal Barilla Pasta fans shared their dinnertime moments with hundreds of thousands of their peers through their social networks, blogs, email and IM.

3. Online marketing has shifted to distributed experiences and sharing functionality.
Online marketing has shifted from Web-based destinations to distributed experiences. According to Universal McCann, content consumption off Web sites jumped 153 percent in the last nine months. Over 50 percent of online users consume content outside of a company or publisher’s site, through widgets, RSS, social networks and mobile devices. Your customers are spending time -“ often living their lives -” on social sites like Facebook, Twitter and Flickr. Groups, lists, and niche networks are becoming more popular. Sharing functionality is becoming mainstream, allowing users to easily broadcast information across their vast social media networks. Consumer sharing about a brand experience has a far greater effect than just a brand sharing direct with a consumer. Coach’s award-winning “Design A Coach Tote” campaign invited Coach lovers everywhere to design their own handbags and share their designs with their friends across social media networks. The result? Six million consumer engagements.

4. New tools make it easier for brands to track and measure viral influence.
Measuring social media is difficult, and recent surveys have found that most companies are not aware of how to best measure consumer engagement. Managing and measuring your social media efforts requires thinking about the value you are creating in the short and longer-term. Social media metrics can include everything from hits, time spent on site, retweets, sharing, forwarding, digging, liking, and views. New patent pending technologies -“ like patent Viral Map and Geo View engagement consoles -” can accurately track reach, frequency, and viral activity in real time. Cisco Small Business recently announced they are expanding their social media efforts to effectively include global consumers, as a result of the viral tracking of its initial social program.

5. The silver bullet is Cost Per Engagement.
Traditional advertising measures like CPM can’t capture consumer interaction on a deeper level. Buying media based on engagement is an interesting offering to advertisers. With Cost Per Engagement (CPE), you only pay for people that actively engage with your brand, instead of paying for hundreds of thousands (or even millions) of people that ‘might’ see your ad. It is time to start thinking of consumers not as impressions, but as active engagers with your brand with opinions and with the power to influence.

Social media engagement builds business and can improve your bottom line. Benchmark your social media strategies against the competition in terms of budgets, resourcing, metrics and barriers to success. How does your company compare?

Nichole Goodyear is co-founder and CEO of Brickfish, the award-winning technology solution that powers social media campaigns for Fortune 1000 marketing leaders and advertising agencies. She chaired the IAB Committee that produced the first-ever IAB Social Media Buyer’s Guide and serves on the Board of the Social Media Advertising Consortium (SMAC). Reach her at: [email protected].

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Richard Blanchard
Rick is the Managing Editor of Corp! magazine. He has worked in reporting and editing roles at the Port Huron Times Herald, Lansing State Journal and The Detroit News, where he was most recently assistant business editor. A native of Michigan, Richard also worked in Washington state as a reporter, photographer and editor at the Anacortes American. He received a bachelor of arts from the University of Michigan and a master’s in accountancy from the University of Phoenix.