What’s the “R” in Return on Investment in Social Media

Katie Paine never fails to come up with a cute acronym to illustrate her point. First it was her cruciate to eliminate HITS from our metrics vocabulary. While for most of us measuring hits means tracking the number of times our website’s server is responding to a request to serve a web page, image or any other file, Katie’s definition of HITS = How Idiots Track Success. Nice! I bet from now on you will never use this KPI in your metrics dashboard.

Here comes another funny acronym Katie coned to help us understand the R in Social Media ROI. It’s KBI which stands for Kick Butt Index. According to Katie the beginning of every successful social media measurement starts with identification of your goals (the R in ROI). If we want to “kick butt” we need to know what “kick butt” means. Are we expected to:

• Improve positioning in our specific marketplace
• Communicate key messages
• Increase brand advocacy
• Increase engagement in the brand
• Demonstrate thought leadership
• Increase customer satisfaction
• Improve company’s reputation
• Bring in qualified leads

Have you noticed that the above list of goals has nothing to do with social media? These are business-specific goals. Knowing them and agreeing on which ones are key will help you determine what KPIs you need to measure in social media to prove success. It often happens in large enterprises that these overarching goals get lost in translation or get misinterpreted or misunderstood. Your job BEFORE committing to executing a social media program is to clearly identify what overarching business goal(s) that you will be contributing to and identify your KPIs accordingly.

If your goal is to increase engagement in the brand the KPI’s Katie recommends:

1. % increase in Engagement Index (time on site/repeat visits/pages per visit)
   OR Conversations Index (ratio of posts to comments)
2. % increase in registrations/requests for information
3. % increase in influence rankings for corp. bloggers & twitterers
4. % increase in membership in company’s communities

If your goal is to communicate key messages KPI’s for this goal should be

1. % of conversations containing one or more key messages
2. Decline in cost per messages communicated (budget divided by message appearances)
3. % increase in awareness and credibility of key messages (through brand survey)

There are way more funny acronyms and visually interesting proof-points behind KBI in Katie Paine’s book “Measuring what Matters.”

This post was influenced by Katie Paine’s presentation titled “Media is the Metrics”  at Connecticut Social Media Breakfast meeting in Hamden, CT.