Measuring Social Web ROI

How do you measure the ROI of social web initiatives?

The snappy answer is that it doesn't matter because the investment, beyond your time, is probably zero. (In most cases, getting on sites like Facebook, Twitter, etc. is free). But your time does have value. So if you're going to spend it on something, you and your credit union should expect some benefit.

To get the discussion going, and I do hope to get your thoughts on measuring ROI, I very briefly want to lay out the social web planning model defined by Li and Bernoff in their book Groundswell. I think it is a worthwhile exercise because if you don't first define what you want to achieve, there really is nothing to measure. The acronym for the model is P.O.S.T. and it goes like this:

• People - Who you want to target and how you expect to engage them
• Objectives - What you expect to achieve and what your members expect to get
• Strategy - How you will connect with your members
• Technology - What applications you will use

The Objective portion of the model is where you define what you want to achieve. It is certainly OK to have marketing and sales goals like increasing membership, loans and the like. But those cannot be the sole basis of your initiative. You have to dig deeper, because the social web is about conversation, sharing and collaboration. So think of objectives that can develop into an enduring storyline that will engage your members more than a litany of marketing messages would. It could be helping your community, providing financial education or many of the other great things credit unions do to help members. Or your objective could simply be to gain insights into the financial needs, issues and concerns of your members.

Once you have your objectives defined, determine how best to measure how you're doing at achieving them and ROI. Measuring the number of fans, followers, traffic and return visits are all metrics you want to watch because they give you a sense of usage and reach. But what they don't measure are member insights and depth of relationship the social web can give you, or the value of that.

To give you an example, I have been getting email questions since starting these efforts from a credit union about social media and the web, which have been great. They have helped to validate that there is interest and in discussing the ways credit unions can leverage the web, and they have given me insights into how at least one credit union is approaching it all. That dialogue helped to inspire this topic, and will influence CU Village's approach to providing services. Honestly, I don't know how you place ROI on those series of interactions, but I do know they have been of huge value to me. I look forward to getting more of those kind of interactions, especially those directly in our blog, Twitter or Facebook page, precisely because of the insights and relationships they give not just to me or CU Village, but to the community of credit unions that are participating.

For credit unions wanting to measure the ROI of their own social web efforts, I recommend looking to the member interactions you get and the insights you gain from them. Because measuring success for the social web is more like the way you would measure success from a focus group or survey than a direct mail campaign. The value comes from what you learn and act on.

Don't get me wrong, the social web is not all soft goals. Sales and marketing goals are critically important too. But if you get your member relationships right through better understanding of their needs, the natural outcome will be achieving your business goals.

For more information on measuring ROI, check out The ROI for Social Media Is Zero by Augustine Fou, chief digital officer of Omnicom's healthcare consultancy group, and How to Measure Social Media ROI for Business by Aaron Uhrmacher from Mashable.