By Jamie Turner, Founder, 60 Second Marketer

Each week, I send special tips and techniques to subscribers to our e-newsletter. The people who have signed up are interested in getting additional tips on how to improve their social media and mobile marketing programs.

Today’s e-newsletter focused on two interesting topics: 1) Social media ROI and, 2) How to get more from your social media campaign by actually doing less.

It was such a popular e-newsletter that I decided to post it on here so our blog readers could enjoy it.

Here goes:

Did you know that a good social media campaign can increase your Customer Lifetime Value?

In its simplest form, Customer Lifetime Value (CLV) is the amount of revenue a typical customer generates for your business during the time that they’re a customer.

So, if you’re a lawn care company and you charge $80 per month for lawn care and your typical customer stays with your business for 3 years, their CLV is $2,880.

Here’s how that calculation works:

CLV = $80/mo x 36 months = $2,880

(If you’d like to learn more about CLV and social media ROI, check out the e-book I wrote that’s available here: Social Media ROI Explained)

So, How Does a Good Social Media Campaign Increase CLV? The answer is pretty simple — studies show that people spend more money with brands they trust, and they trust brands that they have ongoing relationships with.

Let’s say you own a hardware store and the only time you engage with your customers is when they’re in your store buying products. On average, they might spend $35 on each visit. 

But if you have an email campaign, a Facebook page and a QR code campaign — and you use those campaigns to stay in touch between visits — you can change your customers perception from “They’re trying to sell me something” to “They’re trying to help me.”

When customers feel as though you’re trying to help them rather than sell them, they’ll buy more stuff from you.The end result is that instead of spending $35 per visit, they might spend $45 or $50.

How You Can Put This Insight to Work. Most businesspeople will admit that they don’t actively engage with customers through their social media campaigns. For some reason, they believe they can set-it-and-forget-it. But that’s not true.

With that in mind, here are a list of actions steps you can take to help solve that problem:

1. Review Your Existing Campaign: Take a look at what you’re currently doing. Are you actively engaging with people on a daily basis with your social media? If you’re too busy to engage across multiple platforms, can you delete a few accounts and engage across fewer? That’s a counter-intuitive solution that might work for you.
2. Study Your Competition: Take a look at what your competitors are doing. Better still, take a look at what top-performing professionals in other industries are doing. (That’s what I did when I analyzed Michael Hyatt’s blog. He’s got a fabulous blog that’s beautifully designed and packed with terrific content.)
3. Don’t Upload Just to Upload: People (myself included) sometimes fool themselves into believing that uploading anything is better than uploading nothing. That’s not actually the case. (As an example, we’ve spent the past month trying to improve the content on our blog by only uploading genuinely useful content written by top professionals. Hopefully, it’s working.) Take a look at the content you’re putting out and, if necessary, scale it back. Only put out the best content. And make sure that whatever you upload gets filed under “Must Read” in your visitors eyes.

A Final Thought: You’ve got a lot on your plate already, so the last thing you need to do is to worry about doing more. If you read through this e-newsletter carefully, you’ll see that I’m actually suggesting that you do less with social media. The trick is to make sure that what you do execute is top-notch, first-class all the way through.

I hope all that helps. Let me know if you have any feedback.

Note: The post above was taken from our weekly marketing e-newsletter. Thousands of people around the globe are enjoying it already. Why not join in the fray?

By Atri Chatterjee, CMO, Act-On Software

At Act-On, we do a monthly survey of marketers at large; in the last year, we’ve heard from over 14,000 people. They’ve told us that over time, more and more resources are going to social media…but that social’s contribution to the sales pipeline appears paltry.

July 2012 Survey Results, Act-On Software

The problem might actually be that social media’s contribution is difficult to track. In a recent research report, Gleanster’s Ian Michiels mentioned that 93 percent of B2B marketers rank “measuring the return on social media campaigns” as the number one challenge in social media marketing.

In some sense, this is inevitable. Social media functions as the online version of word-of-mouth and overheard-in-the-hall conversations, which are notoriously difficult to quantify. Studies have been done (primarily in B2C) that indicate findings, but the real world is a messy place to do research in, and social media is relentlessly real-world.

Social media also functions like advertising. The meeting planner looking for a venue may hear of a fabulous place with a limited offer via Twitter or Facebook. Her next step will probably be to peruse the venue’s website. When she becomes a prospect, it’s likely that the website (or a direct mail piece) will get the credit.

Most B2B buyers are influenced by multiple channels. This is why it’s important to make your messaging consistent – it helps buyers recognize your brand and reinforces your offer. But it can also blur the origin of a lead. Perhaps social should be budgeted (at least partly) as brand awareness.

Despite the difficulty of measuring it, nobody is retreating on social. Gleanster’s study shows that “top performers” are twice as likely as “everyone else” to use social in inbound and outbound marketing. It may be that top performers get better results because they do everything (including social media) well. Regardless, social media is still emerging and evolving, and we have much to learn about how to use it.

All that said, there is a way to measure social media programs and get usable information about how it affects ROI:

1. Establish a baseline for transactional data prior to investing and executing on social media strategies.
2. Now create a timeline, and overlay it with measures of multiple factors, not just media:
   • Social activities (blogging, tweeting, etc.)
   • Web data (# of hits, pages, time spent, etc.)
   • # of transactions
   • Customer service engagements
   • Revenue (this might be the hardest thing to measure directly, but use a proxy like leads generated to try to back into this).
3. Analyze the results, and look for patterns. As an example, if you have a revenue jump in one area, is that a group that was touched by social media? Has some of your customer support shifted to Twitter?

Here’s a funny and smart slide show by the author of Social Media ROI, Olivier Blanchard, that gives some guidance about how to do this.

You can quantify social media in terms of likes, followers, subscribers and so on, but in the end, because social media influences so many factors in your business success, holding it primarily accountable for lead generation may be the wrong metric. The metric that matters is social’s influence on the entire range of elements (brand awareness, customer service, retention, etc.) that affect revenue.

Another way to look at all this is to see how you are doing relative to your competition, as getting your share of voice online is extremely important. Act-On recently launched a product called Act-On Insight that measures your online posture across a variety of channels (website, blogs, Twitter, Facebook, keywords, and LinkedIn) with those of your competitors, so you can see your relative positioning. It’s a good reflection of what your prospects see as well.

We also recommend Gleanster’s report, Quantifying the Value of Social Media Engagement in B2B Marketing, as it includes guidance for creating a Social Media Mean Performance Score (MPS) that can help you track social media’s effects on the factors that have high value in your organization.

About the Author: Atri Chatterjee, CMO of Act-On Software, is responsible for all things marketing at the company. His previous experience includes senior roles at Symantec, VeriSign, McAfee and Secure Computing. He was also a member of the founding team at Responsys, and an early employee at Netscape.

Not long ago, I created a comic-strip e-book designed to help people learn how to calculate the ROI of their social media campaigns. It was intended to be a fun and useful tool to help people understand concepts like Customer Lifetime Value and Allowable Cost Per Sale.

If your CEO or CFO are bugging you calculate the ROI of your social media campaign, then you might want to download the e-book. It includes some edgy humor, so if you’re not in a light-hearted mood, my apologies.

On a related note, I’ve included a graphic below with a quote some of you might find Pinterest-worthy. If you like it and want to share it with others, feel free to click the “Pin It” button and upload it to one of your Pinterest boards.

Pin It

Posted by Jamie Turner, Founder of the 60 Second Marketer and co-author of “How to Make Money with Social Media” and “Go Mobile.” He is also a popular marketing speaker at events, trade shows and corporations around the globe.

According to eMarketer, US companies using social media have spiked from 42% in 2008 to a whopping 80% this year.

Based on that, it looks as though just about everybody is jumping on the social media bandwagon. That’s great. But if you’re going to launch a social media campaign, you’ll need to understand the hidden costs associated with it.

With that in mind, we took a look at some of the hidden and not-so-hidden costs associated with running a social media campaign.

Here’s what we found:

Twitter: If you are looking to launch a new Twitter account, including both setup and outsourcing content creation, costs are on average $2,000-$4,000 per month. Already have a Twitter account, but looking to restructure it? Well, you are looking at a cost of $1,000-$2,500 per month. Not as cheap as you thought, huh? These costs can include tasks such as:

• Monitoring for related keywords, then pushing links/tweets to those talking about relevant topics
• Obtaining relevant followers
• Consistent feed updates
  

  Despite what you may have heard, social media is not free. There are plenty of hidden costs associated with running a campaign.

Facebook: If you thought Twitter costs were high, take a look at Facebook! PR agencies charge an average $2,500-$5,000 per month with the highest amount reaching up to $9,000! Costs can involve content creation, analyzing and testing as well as other tasks such as:

• Training
• Running contests and notifications of new promotions
• Status updates

Blog: Blogs can be a useful addition to your social marketing campaign and also relatively inexpensive depending on the components you are looking to include. Launching a blog from the ground-up can cost $1,000-$12,000 per month. A blog can include initial setup as well as outsourcing all content creation. Costs can also include additional tasks such as:

• Blog postings
• Monitoring and responding to user comments
• SEO keyword research

Strategy: We are missing a very important component in these prices. Guess what? They don’t include strategy. Without objectives or a definitive game plan, it will be difficult for you to get anywhere with your social media marketing. Social media strategy has a wide range of costs, anywhere from $3,000-$20,000 per month with the average being $4,000-$7,000 per month.

Of course, there are various other social media platforms out there, such as Foursquare, Youtube, Linkedin, etc. However, your company doesn’t need to be on every social network. It’s best to focus on the most popular social sites in order to get the biggest bang for your buck instead of spreading yourself thin across numerous locations.

Also, prices vary based on the size of the business. Smaller businesses, such as the crème brulee man, can manage their Twitter account and other social media at little to no cost with high returns. However, larger companies, such as Best Buy and Starbucks, have more to lose with their social media platforms and must tread lightly.

Don’t let your social media campaign be a shot in the dark. Make the most out of the money that you have, but don’t underestimate the costs of effective social networking when building your budget.

For additional information about the real cost of social media, visit The Content Factory. For information on Social Media ROI, read “How to Calculate the ROI of a Social Media Campaign“  on the 60 Second Marketer blog.

Brittney Leigh Smith is a marketing analyst and a contributing writer for the 60 Second Marketer.