Return on Investment For Social Media: A Proposed Framework For Understanding, Implementing, And Measuring The Return

Abstract

Web 2.0 has enabled a whole new way for companies, user communities and others to engage each other. Social Media (SM) platforms (i.e. blogs, micro-blogs, social networks, video/photo upload sites), in particular, comprise a flourishing new set of eWOM and viral marketing mechanisms that are growing exponentially. More and more global companies are using SM some because they know it works, others because theyre afraid not to use it. How much they spend, and how long they continue to spend it, will depend on how effective SM proves to be in the long run. The measurement of social media effectiveness, or return on investment (ROI), is a key factor in the long term success of SM marketing and management programs. This paper provides a summary overview of the SM ROI literature where there is a vast range of opinions/models/calculations in both academic and trade journals. It suggests that the SM ROI issue is far more complex than most report, and provides a business unit of analysis framework for better understanding this complexity. It also discusses SM ROI measurement within the context of business process/performance management basics and suggests guidelines and principles for how and when to proceed with such measurement.

A Firm’s Activity in Social Media and Its Relationship with Corporate Reputation and Firm Performance

“…To justify investment, it is essential to determine the financial value of social media (Luo et al, 2013;Gilfoil & Jobs, 2012). The use of social media has expanded exponentially among both consumers and corporations, but still only a small amount of money earmarked for marketing is dedicated to social media.…”

“…The use of social media has expanded exponentially among both consumers and corporations, but still only a small amount of money earmarked for marketing is dedicated to social media. One reason for this is the difficulty of measuring the value of investments in social media marketing (Gilfoil & Jobs, 2012). Despite the difficulty of measuring the value of social media, many researchers have attempted to measure its return on investment (ROI).…”

How companies evaluate the ROI of social media marketing programmes: insights from B2B and B2C

“…Additionally, companies have to deal with the dual nature of SM; the owned SM, which is controlled by the company and the earned SM, representing the activities that are neither directly generated nor controlled by the company (Colicev et al, 2018). SMM-ROI can be measured but should be defined and measured in a certain way Kumar and Mirchandaniand (2012), Paul et al (2012); Hoffman and Fodor (2010), Owyang (2010); Mangiuc (2009) SMM ROI can only be measured in financial terms Kaske et al (2012), Turner (2010); Blanchard (2009) SMM-ROI can be measured as a part of a larger, contextual framework or system Peters et al (2013), Gilfoil and Jobs (2012); Nair (2011), Bartholomew (2011); Blanchard (2011), Ray et al (2010); Lake (2009), Murdough (2009) SMM-ROI can be readily measured without much difficulty Fieler (2017); Coleman and Heriot (2014), Vlachvei and Notta (2015); Hall andHume (2011), Campbell (2011); Gillin (2010), Bughin and Chui (2010) Source: Adapted from Gilfoil and Jobs (2012) Altogether, the challenge when it comes to SMM is the qualitative, viral and pervasive nature of some outcomes such as image improvement, brand engagement or brand equity (Tuten, 2008). Table 1 presents a summary of the debate regarding the measure of SMM-ROI, which updates the systematization by Gilfoil and Jobs (2012).…”

“…Altogether, the challenge when it comes to SMM is the qualitative, viral and pervasive nature of some outcomes such as image improvement, brand engagement or brand equity (Tuten, 2008). Table 1 presents a summary of the debate regarding the measure of SMM-ROI, which updates the systematization by Gilfoil and Jobs (2012).…”

Pengaruh Electronic Word of Mouth terhadap Travel Intention Wisatawan ke Nuart Sculpture Park Bandung

“…eWOM merupakan segala pernyataan baik atau buruk yang terbentuk dari potensi, kenyataan, atau pengalaman sebagai pelanggan dari sebuah produk atau perusahaan, yang dibuat tersedia untuk banyak orang dan lembaga melalui internet (Hennig-Thurau, 2004). eWOM juga berperan sebagai rute pengaruh proses sosial di mana individu membuat perubahan pada pemikiran, perasaan, sikap, atau perilaku dari interaksi dengan orang lain secara online (Amblee & Bui, 2011;Gilfoil & Jobs, 2012). Abubakar (2016) mengatakan perilaku konsumsi di masa depan dibentuk oleh penilaian terhadap produk atau layanan yang terkait dengan faktor stimulasi eksternal (yaitu eWOM).…”