The REAL Costs of Social Media

transcript

And why it’s totally worth it

The Real Cost of Social Media

Katrina (Scooter) KokoskaSchipul@kkokoskakkokoska@schipul.com #schipulcon

What?! SMM isn’t free?

@kkokoska // #schipulconhttp://www.flickr.com/photos/75511860@N00/4353835455/

What We’ll Cover:1.) Rethinking social media costs2.) Budget planning breakdown3.) Measuring ROI

@kkokoska // #schipulcon

1.) Rethinking the cost• 43% of US companies are successfully

finding new business with SMM. (Marketing Profs)

• A move from tinkering to full deployment• In 2011 SMM will account for 10.1% of

marketing budgets• Up from 7.1%

The Fanpage

Custom Tabs

• Hub of your social media presence• Home of your promos• Gateway to your website• SEO

The Newsfeed

The Ticker

• Facebook accounts for 90% of time spent social networking

• The Newsfeed accounts for 4% of ALL time spent online

• Users are 40-150 times more likely to consume your content in their newsfeed than on your page

• The average Facebook user has 130 friends (comScore)

Sponsored Content

• Newsfeed is more and more competitive• Built-in endorsements• Flexible and easy-to-use

The Cost of Facebook:• Strategy• Design• Content creation• Development/Hosting• Third-party apps• Research• Legal counsel• TIME

Twitter

Getting Started

A Week of Twitter• Content Research – 2 hrs.• 3-5 tweets per day – 2 hrs.• Monitoring – 2 hrs.• Third-party apps – Btwn. $0 and $500/month• Evaluation – 1 hr

Social Media Toolbox

http://www.flickr.com/photos/95248808@N00/178177044/

Types of Tools• Twitter – Tweetchat, Tweetdeck, Hootsuite• Facebook – North Social, Short Stack• Listening – Radian 6, Traackr• Tracking – Google Analytics, bit.ly• Content Creation

Folding it in

Is this really worth all the trouble?

• SMM is projected to be $3.08 billion of online marketing spends – 10% (eMarketer)

• Organizations are increasing aspects of their SMM budget between 18% and 95% (eMarketer)

Communicating at Your Audience

Communicating with Your Audience

Potential Impressions• 621 likes• 18 shares• 56 comments• 9 liked comments• 91,650 potential impressions

Facebook | Radio

•Production: $50•Monitoring time: $100•Time spent: 1.5 hours•Total: $150•Potential Impressions: 91,650•CPM = $.002

•Production: $30,000-$50,000•Production Time: 2-4 weeks•30-second radio spot: $335•Total: A LOT•Potential Impressions: 138,600•CPM = $21.89-$36.31

So Far…• Where all that money goes

Facebook Twitter Tools Integration

• Why it’s totally worth it• How it stacks up against traditional media

2.) Budget Planning Breakdown

We’ll Cover• Ways to look at it• In plain numbers• Things to consider

Breakdown: By Category

Breakdown: By Platform• Facebook• Twitter• Blogging• LinkedIn• Google +• Yelp

In Plain Numbers• Calculate 10% and 12% of estimated

gross sales• Multiply each by the markup (not

margin) of your average transaction• Subtract rent• Take 10%

In Plain Numbers (cont.)

• Gross Sales: $5,000,000• Markup: 100%• Rent: $250,000• Marketing Budget: $250,000 (10%) -

$350,000(12%)

• SMM Budget: $25,000 - $35,000

Things to consider:• What are your objectives?• What is your overall marketing budget?• How are your current efforts working?• What are your resources?• Social media changes – A LOT!

3.) Ways to Measure ROI

A few truths• It’s not a thing• This will continue to change• Fans outspend non-fans by up 5 times

Media Equivalent Value

Social Media Impressions X

Equivalent Targeted

CPM= MEV

Data Value (Acquisition cost)

ProportionalChannel

ValueX

Acquired Customer Numbers

= Data Value

Avg. Fan Value• Unlikes – per – Month / Total Likes =

Churn %• 1 / Churn = Fan Lifetime Length (FLL)• FLL x Posts-per-day = Opps-per-Fan (OPF)• OPF x CTR = Clicks-per-fan (CPF)• CPF x Conversion % = Sales-per-fan (SPF)• SPF x Avg. $ per Sale = Avg. Fan Value

@kkokoska // #schipulconDan Zarrella

Be Flexible

Takeaways• Social Media can be a major investment with a

major payoff.• Carefully evaluate your brand, resources and

budget before getting started.• Always Evaluate and Adapt.

@kkokoska // #schipulconDan Zarrella

Katrina (Scooter) KokoskaSchipul – The Web Marketing Company@kkokoskakkokoska@schipul.com

@twitter // #schipulcon // http://bit.ly/schipslides

Thanks! Any questions?

The REAL Costs of Social Media

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