Wednesday, August 31, 2011

The Real Cost of Social Media

Social Media is not free! People mistake the actual cost of Social Media. Most of the tools used in creating social media are free, but there are some real costs associated with them. Thankfully, if done right, your social media campaign will deliver more than it's cost. Thank you to Focus, a US based consulting group for their recent study on the real costs of Social Media campaigns. 

So what does the study say?

Campaign Costs
Every campaign is started for a reason. Each Social Media campaign has an end result it is tring to achieve. Whether it is increased brand awareness and visibilty, acquiring a new target audience, or simply introducing a new product or service. Sometimes the end result is difficult to quantifu, but there are definitely goals that need to be achieved. Based on the end result you are looking to achieve you create a campaign by using the tools you feel are the best fit. According to the Focus study, you have to keep in mind the following 'costs' when creating your campaigns:

Employee Input: The number of hours you have someone working on the campaign.

Advertising Costs: Simply opening a Twitter or Facebook account isn't enough. you will need an advertising campaign to help guide Likes and Followers.

External Fees: Are you going to do it all yourself, or are you going to hire an outside party to help you.

Extras: Think about the time it takes to monitor your social media campaign, creating items to post and this can get expensive. 

In the infographic below you can see what the real cost of a social media campaign could be for 1 year. It may seem like a lot but when you look at all the components, it is pretty realistic...and definitely cheaper than an actual Ad Campaign.

The Advantages of Social Media
This next section was based on an online study of American Marketers. Below you can see the advantages they see of producing Social Media campaigns:

Customer Engagement: 85.4%
Direct Customer Communications: 65%
Speed of Feedback: 59.9%
Learning Customer Preferences: 59.1%
Low Cost: 51.1%
Brand Building: 48.2%
Market Research: 42.3%
Cedibility of the "Crowd": 40.1%
Reach: 37.2%
Great Lead Generation: 21.2%
Customer Service: 17.5%

The Real Results
Although many of us probably knew this already, Facebook Fans are worth money! Based on the Focus study results, Facebook fans spend significantly more on brands than non-fans. Definitely a no-brainer....right!

ROI from Twitter
Calculating the monthly investment, monthly return, cost per follower and the value of the follower, FOcus was able to provide an estimate on the ROI of using Twitter for your brand. At 43% percent...its not bad...but it is just an estimate. 

If you check the bottom of the full infographic you will see two case studys that help prove the study's point. I especially like the Old Spice example. You can definitely see the value of supplementing an ad campaign with a Social Media marketing campaign.

What do you think about the findings of this study? How much time are you spending on your Social Media campaign...and are you using it as a supplement to some great ad and marketing campaigns? At BENG! New York and Amsterdam we believe in the power of Social Media as an additional tool to help you achieve overal ROI. It definitely needs to supplementing a program. As Brand Marketers, we make sure to include a Social aspect in all of our projects. Whether it's a Guerrilla Marketing Campaign, An Incentive event for 300 employees, An Internal Branding Change or a Product Launch. It is important to not consider Social Media in a vacuum, and to make sure you understand the real cost of spending time and energy Tweeting, and creating content.


[via Focus and PowerPR]