Let’s go over a few things:
1. Social Media is good for you, you know it, and you know why.
2. Social Media alone can’t save your business, but you know that your business can no longer be a market leader without an effective presence in Social Media.
3. Without resources to put behind a social media program or practice, you’re nowhere. It’s kind of like trying to drive a car without gasoline. Sorry. It isn’t going to happen.
4. Without capital, you can’t put resources behind your Social Media program. So… you have to be able to justify that expenditure. That investment.
5. In order to be able to justify an investment in a Social Media program (from your boss, your client, your peers) you need to understand how to show the value of such a program to their organization.
6. Hits on your website, banner ad clickthroughs, impressions, KPI and whatever other types of measurement your marketing people love to throw at you are nice, they’re important, but they don’t justify a whole lot. They’re a lot like hugs: Everyone knows hugs are nice, but they don’t pay anyone’s salaries and bonuses. You have to take that game a little further.
7. The P&L is not an arcane accounting document. It is where business decisions are put to the test. Every business manager on the planet watches it daily. If you have never been responsible for one, at least get familiar with its mechanics and importance.
8. If you want to justify a budget, a program, a salary, a raise, a bonus, show your boss and your client how your idea will generate more revenue, more dividends or more cost savings. Or how it already has. That will ALWAYS get more priority than schemes to get attention or earn hugs. Money is not an abstract notion. You could get lucky and never be asked to tie your activities to financial impact, but that’s no excuse not to learn how to do it.
9. If you are not able to do this, if you cannot justify the value of a Social Media program, practice, presence or endeavor, the budget you needed to make it happen will go to something else. Like email blasts, efficiency consultants, or that new executive bathroom your boss has really been jonesing for.
10. If you cannot convince your boss or client to invest resources, time and faith in Social Media, they (and you) will get left behind by those of us who can and do. (And I assume you don’t want that.)
11. There are solid measurement and R.O.I. Best Practices and case studies being developed right now. They will pave the way for very, very VERY good things. If #10 (above) resonated with you, you probably want to learn from them so you can apply them to your business. Hence my proposal to SxSW ’10.
12. The nonsense and B.S. need to stop. They really do. For everyone’s sake.
You have a choice: You can continue to ignore the topic of Social Media measurement and R.O.I. Best Practices and pretend that talking about web conversions and the influencer index and brand lift will keep things going (which they won’t), or you can get serious about this stuff, learn how to do it right, and be a hero with every company you work for for the next ten years.
Your choice.
If you want to learn this stuff, if you want to bring this discussion to the table, please vote for my session at SxSW asap. The voting ends on Friday at midnight, so I really need you guys to act now. Spread the word, show people my latest R.O.I. presentation if you have to… whatever works. It’s up to you. Know that if the session doesn’t get enough votes and isn’t accepted, I am 100% fine with that… But it would be a shame: The sooner we put the R.O.I. “discussion” to rest, the sooner we establish these best practices once and for all, the sooner we can get back to doing more important work.
If you haven’t voted yet, click here now, and thanks in advance. Pass it on. 
(You guys rock, by the way!)
Good summary, Olivier.
BTW, I want to know who does your graphics. Outrageous.
For the most part, I do.
Still captivated by your presentation @SoFresh on ROI. Like you said: “The sooner we put the R.O.I. “discussion” to rest, the sooner we establish these best practices once and for all.” best of luck!
Thanks, Roy.
[...] Read the original here: Why R.O.I. Best Practices for Soc&… [...]
My vote’s recorded. It’s a worthy topic. Good luck!
Mel, you are the man!
Excellent piece Olivier. I keep coming back to you when looking for relevant information to share about SocMedia ROI and budgeting for businesses interested in SocMedia integration. I voted for your presentation to be at SxSW’10 (which I hope to attend) so best of luck there!
If you don’t mind, I would like to re-post a summary if this along with links to your original article, I think many of my readers would find you awesome like I do. here’s a link: http://blog.mehype.com. Thanks again and keep it coming!
@tylerlecompte
Thanks, Tyler. Absolutely. Feel free to re-post all you want.
more and more people should try this my vote is yours
Thanks for sharing with us…..
[...] my blog and through Twitter, I know that ROI means return on investment. Through the great work of Olivier Blanchard, and others, I think we’ve achieved a greater understanding of what ROI REALLY means when it [...]
Done – look forward to hearing you speak and thanks for bringing some sanity to the conversation – enough of the echo-chamber. I am going to share your ideas and methods (always attributing to you, of course).
Oliver, You bring clarity and wisdom to the often cloudy realm of Social Media ROI. Much appreciated.
Fantastic post I am curious to learn what blog system you happen to be working with? We are experiencing several small safety problems with my latest blog thus I would wish to discover some thing a lot more risk-free. Have you got any recommendations? Incidentally did you hear about Obamas budget problems!