Is Social Media Actually Helping Your Company’s Bottom Line?, from Harvard Business Review.
When it comes to business, we talk too much about social media and expect too little. It’s like the old joke about sales people: one person says, “I made some valuable contacts today,” and the other responds, “I didn’t get any orders, either.” Companies measure the market results of their sales investments. But few have measures or even have accountable managers in place for their social media investments, and only 7% say their organizations “understand the exact value at stake from digital.” Meanwhile, according to a Gallup survey, 62% of U.S. adults who use social media say these sites have no influence on their purchasing decisions and only 5% say they have a great deal of influence.
- The most common metrics for evaluating social media are likes, tweets, reviews, and click-through-rates (CTRs) for online ads — not cause-and-effect links between the medium and market results. The basic investment logic is typically no deeper than a version of “Fifty million tweets or likes can’t be wrong” . . . or can they? There is justifiable skepticism about this data. Farming services spike these numbers, with evidence that one in three online reviews is fake. For $50, you can buy 1,000 Likes, 5,000 Twitter followers, or 200 Google +1s. With real people, moreover, 8% of internet users account for 85% of clicks on display ads, and 85% of social media updates come from less than 30% of a company’s social-media audience. One online reviewer, Harriet Klausner, has reviewed more than 25,000 books.