Google Addresses Revenue Impact of Social Media with New Social Reports

Even though the topic of social media ROI may sometimes seem like an endless game of Whack-a-Mole [see previous post], there’s plenty of evidence to suggest we’re inching ever closer to accountability.

Today’s announcement from the Google Social Analytics team aims to address some of the most pressing questions that marketers face when trying to understand the revenue impact of social media:

  • How does traffic from social sites lead to conversion?
  • What can we conclude about the impact of activities outside our own sites?

What’s vexing for anyone trying to understand the impact of social media is less the tracking than the attribution; how do we fairly assign a value to social media interactions?

This is a much clearer proposition on a website than in social media: if I visit Target.com, it’s safe to assume I have at least some sort of intention to buy, or browse, or do something that could reasonably conclude in a transaction.

But if I’m on Facebook, I’m on Facebook. I’m there to catch up on my friends’ news, chat, send a message, upload a photo; whatever it may be. If I then see some compelling content from Target, I may click over, but it’s not why I came to Facebook in the first place. So web analytics teams who venture into social need to remember that they’re dealing with a very different set of expectations and behaviors on social versus traditional digital channels.

One company that understands this dynamic well is PETCO, which tends to treat Facebook as a venue primarily for social interaction; that is, for people to talk about and post pictures of their pets.  They reserve their more overt sales tactics for the website, which is appropriate. If you visit the PETCO Facebook page, you’ll see the occasional call to action, but the timeline is dominated by fluffy, sleepy and generally adorable creatures of all shapes, sizes and species.

We also know that people don’t shop in a linear fashion. We wander in and out of stores, look at websites, put things into and take them out of our shopping carts, and–yes–talk to people who influence our opinions. Some of these conversations may happen online, as with product reviews, but many happen in real life, where no one can hear us (yet).

So how do you fairly define or value a “social” conversion?

Since we’re in the midst of March Madness, it seems fitting to compare Google’s view of social media conversions to field goals and assists.

  • Last Interaction Social Conversion means that the social content was the last thing the person clicked on before buying (the “field goal”).
  • Assisted Social Conversion ”doesn’t immediately generate a conversion, but the visitor returns later and converts” (the “assist”; think Chris Paul to Blake Griffin).

As in sports, this can become a bit metaphysical when you start to try to attribute precise weightings to actions, but it’s a reasonable way to approach conversion measurement for social media. Here’s what it looks like in report form:

If, like me, you’re thinking ahead to Key Performance Indicator (KPI) development, you’ll want to start benchmarking these metrics (Percentage of Last Interaction Social Conversions/Conversions; or Percentage of Assisted Social Conversions/Conversions) to get a sense of any patterns in the data. While it would take some time (at least a year, in my opinion, given seasonality) to get a true benchmark, it’s a worthwhile learning opportunity.

The other reports available in this release focus on more granular data; you can see examples of them on the Google blog today:

      • Conversions Report. Which goals are being impacted by social media
      • Social Sources. How visitors from different sources behave
      • Social Plugins. Which content is most sharable
      • Activity Stream. What’s happening outside the website

The weakness in Google’s social analytics strategy continues to be integration; given who Google is, it’s no surprise that the biggest players would be wary of participating in their Analytics Social Data Hub. The partner list is notably sparse, and is weighted toward smaller and lesser-known platforms, which presumably have more to gain and less to lose from opening their APIs to Google.

But while the lack of partners in the Social Data Hub is concerning, to overfocus on it obscures an important contribution, which is to challenge and advance our collective thinking about how to measure the business impact of social media. These reports represent a valuable step in that direction, and one which–whether or not you use Google Analytics–is relevant for anyone trying to assess the revenue impact of and develop meaningful KPIs for social media.

Implications for Brands

    1. If you use Google Analytics, use these new reports as a way to benchmark social media and start to better understand:
      • What leads to “Last Interaction” versus “Assisted” conversions
      • How content and channels affect conversion
    2. Start building KPIs from these measurements and socializing them within your organization. Be sure to set appropriate expectations, given that this is a new set of data.
    3. Look closely at the resource impact that interpreting these new metrics has on your organization. Depending on how you are staffed, this could be minimal to significant.
    4. If you’re not a Google Analytics user, it’s still helpful to take a look at these reports to familiarize yourself with them and determine whether you have access to this type of data from your social analytics solutions.

As always, I’d love to hear your feedback and experiences here.

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