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Social Networks, cont.
Strong mutual link between actors B & E
Weak unidirectional link from C to B
F is isolated
B, C, and E form a group
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The figure shows a network for 6 actors and its corresponding matrix data.
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Social Networks, cont.
In social networks, some members are more connected & influential than others
Goal is to locate highly influential members, induce their trial of products; propel the diffusion process
Locating “central” members
Centrality indices are computed for each actor in the network to describe the position of that actor relative to the others
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In social networking sites, as in any social circle, some members are more connected and influential than others. Marketers would like to leverage these interpersonal group dynamics, ideally locating the highly connected influential members, to induce their trial of products, in turn initiating and propelling the diffusion process.
To do so, network marketers study how actors are embedded in their network to locate those that are relatively central. Centrality indices are computed for each actor in the network to describe the position of that actor relative to the others.
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Social Networks, cont.
Centrality: Number of connections each actor has with the others
Centrality index
Central = many links
Peripheral = fewer links
Cliques
Groups of people in a network
Common in brand communities, affinity groups, cell phone friends, etc.
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The easiest and most common way to characterize centrality is to count the number of connections each actor has with the others in the network. An index of “degree centrality” is derived for each actor—those with many links are said to be relatively central, and those with fewer links are more peripheral.
Another idea related to network analyses are cliques. Cliques are groups of people in the network. Cliques are common in delineating brand communities and can be a nice way to find homogenous segments of like-minded people.
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Social Media ROI, KPIs, and Web Analytics
Determine ROI
Must know the goal that the marketing action was intended to achieve.
Key performance indicators (KPIs)
Reach, frequency, monetary value of customers, customers’ behaviors, attitudes, memory, etc.
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As with traditional media, we can begin to answer ROI questions only if we know the goal that the marketing action was intended to achieve. Once we know the goals, selecting the media and measures is rather straightforward.
When estimating ROI, the primary expenditures might not be media buys or explicit budgetary contributions, so much as salary equivalents of people’s time allocations.
Key performance indicators, or KPIs, for social media are analogous to traditional measures for advertising effectiveness. Specifically, marketers are always interested in quantifying reach, frequency, monetary value of customers, customers’ behaviors, attitudes, memory, including both recall and recognition, and so on. In social media, measures for these marketing goals simply take on slightly different forms.
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Social Media ROI, KPIs, and Web Analytics, cont.
Pre-Purchase: Awareness
Reach can be achieved via
Traditional media
Online
Media that optimize reach
Reward current customers
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In the pre-purchase phase, marketers want customers to be aware of their brand, and consider their brand for purchase. Reach is the measure of the size of the audience that has been exposed to some brand information and who might therefore have some familiarity with the brand. Reach can be achieved via traditional media and measured via online capture, such as in a magazine ad that tempts the reader to learn more by going online and landing at a particular page associated with the magazine source. Reach can also be achieved wholly online, as a function of ads on popular sites, purchased status on search engines, even via click-thrus on annoying banner ads.
If marketers wish to enhance awareness, they seek media that optimize reach.
If there is an existing customer base, marketers can reward current customers with incentives to generate word of mouth. Word of mouth in customer networks is very rewarding to firms because they usually bring in new customers.
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Social Media ROI, KPIs, and Web Analytics, cont.
Pre-purchase: Brand Consideration
Offer more information to build knowledge & persuade
Use media that give more content
Search Engine Optimization (SEO)
Prime Web Analytics
Frequencies, rates, or durations
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Next, marketers want to offer more information to build customers’ knowledge of the brand, and more persuasion to make their opinions as favorable as possible. To do so, marketers need to use media that convey more content. They pay for search engine ad placement, post some information teasers in related brand communities, and provide podcasts containing product information and customer testimonials.
Many of the measures in this phase fall under the broad category of search engine optimization , or S.E.O. When customers have a preferred brand, they can go directly to purchase sites. However, when they do not, they will conduct a search. The search keywords depend on where customers are along the knowledge continuum.
At the stage of brand consideration, several measures are prime web analytics—they are frequencies, rates, or durations. Frequencies include the sheer number of visits and estimates of the number of unique visitors; that is, the second number is an attempt to remove the duplications from the first number. Durations are usually measures of times spent per page, and overall time spent on the site.
Rates include bounce rates—these are the percent of sessions for which a visitor lands on the website and needs only one page viewing to decide and click off the website altogether. Rates also include conversion rates—capturing when a visitor transitions from a looker to a doer.
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Social Media ROI, KPIs, and Web Analytics, cont.
Purchase or Behavioral Engagement
Induce any action that engages the prospective customer
Instead of “Contact Us” marketers prefer forms that capture specific information
KPIs
Number of posts, audience build
Conversion rates
Compare desired outcomes to number of visits
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Ideally, customers are moving toward purchasing. However, there are a number of steps that serve as precursors that nevertheless are hopeful signals toward ultimate purchase. Thus marketers speak of inducing any kind of action that begins to engage the prospective customer. Web analytics experts disdain the “Contact Us” buttons, instead recommending that a web visitor has to fill out a form, so the company can capture at least basic information on this customer and sales opportunity. In return, companies can provide exclusivity to web visitors. Brand fans may be asked to post opinions and reviews. Sales promos may be made available from site visits or Tweeted out to followers. Customer service can unfold in real time.
KPIs are pretty clean when measuring behaviors. Thus metrics include numbers of posts regarding the brand on blogs or social networks, audience build as measured by incoming links and the speed of that growth. Conversion rates are straightforward to compute. They consist of frequencies of web visitors to engage in the focal behavior, such as purchasing or signing up for email, relative to the number of visitors who come to the website. That is, the rates compare the desired outcomes to the number of visits or to the number of unique visitors.
Costs of the actions depend on the marketing goals: estimates of acquisition costs, payment for placement in search engines or banner ads, sending emails from a rented address database, etc. On the KPIs side, the effectiveness of those actions can be assessed by these frequencies, rates, and durations. Web analysts track the number of visitors coming via different routes, and they follow the customers’ traversal to the particular engagement behavior of interest.
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Social Media ROI, KPIs, and Web Analytics, cont.
Post-Purchase
Satisfied customers
Customers may post positive reviews, give endorsements, etc.
Dissatisfied customers
Company can read complaints, address issues, give incentives, etc.
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The wise companies care about their customers long after the purchase. If customers are satisfied, they may post positive reviews. If they are ecstatic, they may post extremely happy endorsements. The company may wish to reward these brand evangelists.
If the customers are unhappy, the company can at least read the nature of the complaint and work to address it. Companies can intervene to try for service recovery, bringing the customer back on board. Even grumbling customers respond to incentives—company apologies, problem solutions, and restorative benefits can help in retention, preventing customer defections, and turning a bad situation around.
It is not unusual for blogs, wikis, or lead user communities to be essential during product development, generating enthusiasm in the marketplace prior to launch.
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Check Your Understanding
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Summary
Social media defined
Media trends
Types of social media
Social networks
Social media ROI, KPIs, and web analytics
We have reached the end of this lesson. Let’s take a look at what we’ve covered.
First, we defined what is meant by social media which defined as people interacting and connecting with others via online software or alternative electronic access technologies, such as smartphones or tablet computers.
Next, we discussed the media trends.
Then, we reviewed the types of social media, include rich, vivid sensory experiences, simple, industrious, and social.
Then, we defined social networks as the set of actors, or nodes, and the relational ties that link them.
Last, we discussed various methods that marketers use to measure social media, ROI, KPIs, and Web Analytics.
This completes this lesson.
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