MATT:
In my training, I do an informal poll asking people what their frustrations are about analytics. And especially when I get a lot of social media managers, their number‐one frustration is having to justify what they do. The problem, as we’ve just gone through, is they’re bringing platform metrics to analytics.
They’re not connecting these dots. They think they’re reporting on their activity. “Here’s how busy I am. Here’s how many posts I made.” And if you want to be ignored at an important meeting, then talk about engagement.
No one sees the economic value of a Comment, Share, or Like. And until you’re translating all of this into dollar signs, nobody cares.
GREG:
Yeah. I run into exactly the same phenomena. So, here’s how I explain this in onsite and online courses that prepare professionals for OMCA certification: too many people are measuring inputs. You know, how many hours I spent working on this project or program.
And more people need to start measuring outputs. That’s where the Conversation, Amplification, and Applause rates come in.
But ultimately, you want to begin measuring outcomes. And that’s where the economic value comes in.
So, inputs? Who cares? Outputs? Nice. Not thrilling, but nice. It tells social media managers what they need to do next to be more effective. But outcomes? That’s what executives are paying for. That’s why they’ve given you a salary and a budget for your social media marketing campaign or program.
So, move from inputs to outputs. And then move from outputs to outcomes.
Selecting KPIs Tied to Your Business Objectives
MATT:
Well, that requires a better understanding of KPIs.
Now, Greg, I don’t know if you saw the report entitled, “Media KPIs That Matter,” which was published in 2021 by the Association of National Advertisers (ANA). The most important KPI for Media was Return on Investment (ROI)/Return on Ad Spend (ROAS).
And ROI/ROAS is an outcome metric that’s directly tied to business growth. It’s used to calculate: “For every dollar spent, what is the expected return?” It guides marketers on whether their advertising investment paid off this quarter. Measurement of ROI/ROAS can be done via marketing mix modeling, which is often used to optimize advertising mix and promotional tactics. This metric was not only ranked first in importance, but also fourth in use. It was identified as a top new/emerging KPI for media.
And I went through the list of most important KPIs saying, “Five of the top six are outcomes. That’s great.” Then, I looked at the second list of most used KPIs and only one out of the top six was an outcome.
And the most used KPI was CPM (Cost per Thousand). And here’s where my nerdiness comes out because I said, “CPM is not a KPI. It measures efficiency, not performance.” And the second most used KPI was CPC (cost‐per‐click), which also measures efficiency.
So, it blows my mind that most social media marketers don’t know that a key performance indicator (KPI) is a metric that helps you understand how you are doing against your objectives. And efficiency is nice. Not thrilling, but nice. But your KPIs should be tied to outcomes.
GREG:
Yeah. And that reminds me of a story that I told on one of your earlier podcasts. It was about my father, who was the director of marketing at Oldsmobile.
Now, some of our listeners are too young to remember what an Oldsmobile was. It was a car. It had been around for more than a hundred years. And my father became the director of marketing back in 1988, before many of you were born. So, you may not have heard about his classic advertising campaign, which declared, “This is NOT your father’s Oldsmobile.”
And that was really ironic for me because it was my father’s Oldsmobile.
The campaign’s slogan became a meme. But sales went down.
So, my father asked his ad agency, “How are we measuring success?” And their answer was gross rating points (GRPs).
So, my father asked, “How many GRPs do we need to sell a car?” And the agency couldn’t answer his question because there is no correlation between GRPs and sales.
So, I learned the hard way from my father’s unsuccessful ad campaign that you need to measure what matters. That’s not inputs or even outputs. What you need to measure are outcomes.
MATT:
Well, I think you hit the nail on the head because that story is so good at showing what can happen when you use the wrong metrics as KPIs.
GREG:
And beyond ROI/ROAS, there are other metrics that matter, including customer satisfaction and lifetime value that you should focus on.
This is why so many social media marketers fail to get a seat at the big table. They often measure inputs and sometimes measure outputs. But they rarely measure outcomes.
Using “Action Dashboard” Versus “Crappy Dashboard”
MATT:
This gets to the final topic in our outline: The “action dashboard” versus the “crappy dashboard.”
One of the reasons that most dashboards are “crappy” is because they are data dumps that provide few insights and little analysis of key trends. And they rarely recommend what actions or next steps should be taken.
To create an “actionable” dashboard, you need to take your engagement metrics for Conversation, Amplification, and Applause and do an analysis of your best/worst posts. Then, you need to uncover the best and the worst topics and keywords for successful posts. And discover which types of content perform the best—videos, pictures, or text.
Or you can compare your social media stats against your competitors and against industry average results. Do this both in absolute and relative metrics (per 1,000 followers).
Or you can analyze how user activity on your social media accounts has changed over time and compare the percentage of increase or decrease for each metric by week or month.
GREG:
And you need to have the courage to let your executives know if corporate propaganda doesn’t work. Why can you afford to make this kind of career‐damaging move? Because, if you do, then you will become more successful and valuable to your organization. And if you don’t, then your job will remain pushing corporate propaganda into social channels.
MATT:
Right. And then compare the performance and economic value for all your social media accounts. Then find the most effective content and platforms for your business.
Then, you should recommend what needs to be done next. Most executives actually want insights tied to action recommendations. This is what gets you a seat at the big table.
So, you’ve got to know which KPI to use at every stage of the customer journey, so that you can measure brand lift in the early stages and conversion events in the later stages.
GREG:
Otherwise, you end up trying to measure a fish by its ability to climb a tree.
MATT:
I like that metaphor.
GREG:
Well, it’s attributed to Albert Einstein of all people.
But one of the things that you need to understand about the customer journey is it’s a process. It’s not a one‐time event. And if you try to move people to the next stage too rapidly, or you ask for the order too soon, then they feel pushed.
So, the process may be longer and more convoluted than the old sales funnel model. But your ability to interact with people as they return again and again for different information is building a relationship. That is really where social media can shine.
Leave a Reply