While the struggle to sufficiently measure the impact of social media to a company’s bottom line continues, many businesses are still exploring ways in which they can use social media and hopefully measure its impact. But as executives cry about effect on bottom-line and seek justification for allocating more funds to social media, let’s explore the even the face value of social media.
I opened an NIC Bank account a few months ago after a slew of praises were showered on them on twitter by a friend and corroborated by a number of other influential tweeps. Being in the process of opening a branch of my company in Botswana, I was looking for a Bank that would serve me best in both these countries. I recalled what these tweeps were discussing with regard to NIC and the big help they were in assisting them even when they were out of the country. My decision was made on my bank of choice and I will say that is a decision I do not regret. They make me and my business feel like a big multinational in terms of service and customer care.
What we have is happy consumers doing free marketing for NIC Bank and getting the likes of me and also through me a number of my friends to join NIC Bank. Most of this we have done sometimes through conversations over beer but mostly, it has been done through tweets or Facebook updates about how NIC Bank rocks. Can NIC Bank track how many of its new account holders came through social media? Probably not! They do ask you your reasons for opening an account and among them is Word of Mouth, Direct Marketing, Promotional Campaign, Advertisement and Good Service of Product. I said Good Service/Product but what they do not know is that I got to know they had good service through social media (online word of mouth). By being a great bank that is appreciated by mostly young people, what it has is a loyal customer base who are actively talking online.
So here you are as a business; majority of Kenyans are what you would call youth, most are accessing internet via their phones, most of the time they spend online is on social networks, and this time is spent talking, sharing, discovering, discussing etc. As a business, you feature in these conversations because a number of these Kenyans who are talking are your customers. How you feature could be positive or negative based on your brand promise vis-a-vis delivery. So based on the online word of mouth by your existing clients, you are either winning new customers or losing existing ones and with that any chance of getting new customers. Given this scenario, you still find many executives throwing social media proposals in the bin because they do not have definite numbers by which it will affect the bottom-line?
In a research that was just released on increasing spending on social media by businesses, the metrics which Chief Marketing Officers are focusing on were analyzed. While there is still difficulty in computing hard quantitative metrics as regards the bottom-line, softer metrics were becoming more popular among CMO’s. To quote; “Marketers are currently focused on customer relationship management and working to build these relationships on social media, not just on encouraging sales or higher revenue per customer. This is an interesting trend, as many businesses still struggle to show how these softer, relationship-based metrics relate back to the bottom line. But if companies can show how socially engaged consumers become loyal, repeat customers who share information about the brand via word-of-mouth, these softer metrics may become even more important.”
This brings to bear my point of creating a loyalty loop among your customer base. Through social media, you can build a community around your brand or product, a community that is active, influential and through experience, both informed about your product offerings and happy to do your marketing for you. For NIC Bank, it is this community, albeit scattered that led me to choosing them as my business bank of choice. It is through the great service that I have received so far that I am converted into a brand advocate for NIC Bank. Now imagine the impact this would have if NIC Bank actually took their time to actively build a community online around them and their product by showcasing how receptive they are off-line online. Imagine if NIC Bank took its time to build this community that is obviously online and use this community for R&D, product launches, promotional campaigns etc.
As a business executive, which is better: waiting until the industry has grown enough that all metrics can be related back to the bottom-line or building a community now and exploit its benefits as you go while being part of the leaders who will shape and refine what Social Media ROI will be going forward? All I know is this, I wouldn’t want to be in a group that has 10 followers and 20 fans at a time when your competitors are in the hundreds of thousands. Guess what, you will both be making use of the same ROI formula but only one of you will be getting the true returns on investment. A big part of that investment today is the time it takes to grow a community online.
What say you?