More than 95 percent of companies currently use social media marketing. Is there a financial benefit? I performed extensive research \u2013 including a review of over 100 articles, blogs, white papers, and e-books \u2013 to answer the question.\nWe performed a meta-analysis of all the research. Here are some results:\n\nSocial media is an opportunity for CIOs to show business leadership\nFew companies \u2013\u00a015 percent to 20 percent\u2013\u00a0quantify social media ROI\nLinking social media results to sales\/revenue is hard but can be done\nWhat other businesses are doing \u2013\u00a0top social media platforms\nWhat is the quantified value of social media?\nFear not! There are success stories \u2013 Dell, VMWare, and Starwoods, for example\nWhat to do?\n\n\u00a01. CIOs Need To Be Involved In Social Media Marketing\nAs a CIO, should you be involved in social media marketing, or more broadly, digital marketing?\nYES! YES! YES!\nWhy?\nPhilosophically \u2013\u00a0Social media marketing is an emerging opportunity for a company to obtain strategic value from the use of technology. IT should lead these types of efforts!\nPragmatically \u2013\u00a0An IT organization can provide significant social media marketing value to a company:\n\nReduce technology sprawl and costs via consolidation\nLead or contribute to a cross-functional (sales, marketing, product development) social media focus and strategy\nUnderstand compliance and privacy issues\nIntegrate social media data and analysis across channels\nMeasure results\n\n\n\n\nWhat best describes your IT organization's involvement in social media marketing?\n\u00a02. Only 15 Percent of Companies Quantify ROI (but Everyone Wants to) \nThe CMO Survey shows only 15 percent of companies quantify ROI. Social media vendor surveys state the rate is about 25 percent. Let\u2019s go with the more objective source and lower percentage \u2013 15 percent.\n The CMO Survey (August 2014), Highlights and Insights Report \n\u00a03. Social Media is Hard to Measure - Why?\nMeasuring the business value of social media is difficult. The top problems in measuring social media ROI:\n\nLack of experience. Most companies are experimenting with social media, proven techniques are hard to come by.\nLack of strategic intent. Few \u2013 less than 25 percent of companies - use social media to drive revenue. The top benefit: Eighty percent to 90 percent cite increased brand presence and awareness. Brand presence is not a CEO-friendly measure!\nOnly what is easy is measured.\u00a0Eighty percent of companies want to know how to measure social media ROI. Less than 50 percent currently measure results. The most common metrics measured: reach (# of friends, # of followers) or Web analytics (clicks, website visitors). One bad approach: AVE \u2013 ad value equivalent \u2013 determining value based on the cost of ads that would have been needed to obtain the equivalent results.\nDifficulty measuring campaigns. It is hard to tease out the effect of social media within a multi-channel campaign. Tracking the last click is relatively easy, not the path from first click.\nComplex data and tool integration is generally required. Each platform has its own measurement and data analysis tools. Coherently tying Web analytics, lead gen, and sales data is difficult.\nTrivial\/bad calculators. Many social media ROI calculators are similar to:Get 1,000,000 Facebook friends -> 10 percent of them will become a lead -> 2 percent of your leads become sales -> You will get 2,000 new customers!\n\n\u00a04. What Others Businesses are Doing - Top Social Media Platforms \nNo surprise here, Facebook and Twitter are tops. LinkedIn is used as a social media platform 69 percent on average (however higher for B2B companies and lower for B2C companies).\n Peter Brooks, International Institute of IT Economics\n\u00a0Some examples, chosen to show varying social media approaches and platforms:\n\nDell achieved $3 million in sales for its Dell Outlet via Twitter\nStarwood made $2\u00a0million\u00a0via one Facebook campaign\nVMware obtained more than a 1,600 percent ROI hosting a live Google+ Hangout\n\n5. What is the Quantified Value of Social Media?\u00a0\nLet\u2019s pick the most popular platform: Facebook. Surveys show that the value of a Facebook \u201cLike\u201d can range from nothing to $215(!), typically based on higher sales from a business\u2019s Facebook fans compared to non-fans.\nThese surveys show that the business value of a Facebook Like can be calculated, though widely varying by company. But does Liking a company result in higher sales or do people who are already high spenders tend to Like companies that they buy from?\n6. What to Do?\u00a0\nGet involved! Some relevant links:\n\nFind out what are others doing. Check out three good research reports: the 2014 Social Media Marketing Industry Report, Forrester\u2019s The 2014 State of Enterprise Social Marketing Report, and The CMO Survey Report. There are others. Research your own customer base.\nFigure out your goal. Is the social media goal brand awareness? Better market research? Or \u2013 shudder \u2013 increased revenue?\nIdentify the costs of social media. Costs are critical input to an ROI analysis so if you can so if you can nail costs down you are on the road to insights and effective management.\nLink social media to business results. Recommended business results are revenue, new customers, or economic value \/ customer lifetime value. The basics, though easier said than done. A potentially interesting new measure: Avinash Kaushik\u2019s conversion rate, amplification rate, applause rate, and economic value metrics.\nStart focusing on measurement tools. To get integrated, real-time or close to real-time results across your social media you can use perhaps a half dozen individual tools or investigate comprehensive tools from Adobe, HootSuite, Hubspot, Marketo, and other vendors.\u00a0\n\nGood luck friend (and follower, and connection, and \u2026) Remember:\u00a0\u201cWhat gets measured gets managed.\u201d *\n Social Media 01 by Rosaura Ochoa (cc by 2.0) \n* Often attributed to Peter Drucker, but original source is unclear.