Matching a customer to their online identity is the key to identifying the value of social networks for your brand. David Reed finds outs how RAPP are helping clients to remove the guesswork when it comes to investing in social media.
“Are social networks worth investing in?” This is one of the big questions keeping CMOs up at night, according to Ed Ballard, technology strategist at RAPP. Social media is a huge topic among marketers because it enables brands to have conversations with their consumers. But in order to help marketers determine which channels to invest in, they need to go through a number of processes.
First, you need to find out who are the really valuable social consumers on your database and secondly, what level of influence they have with regard to your products and services, explains Ballard. But connecting the social profiles of customers to your data is more complicated than it sounds, requiring a combination of classic direct marketing and cutting edge data techniques. So how does it work?
“If you’re a mass market brand with a database of 10 million plus customers you can match email addresses from your database against Twitter. The matches you get tell you which of your customers and the percentage of your customers that are using that channel. It’s this that enables you to evaluate whether a channel is worthwhile investing in,” says Ballard.
A match rate of 15 per cent would generate a file of 1.5 million customers who can now be identified as Twitter users on your database. Once the degree of activity shown by a social network user is analysed, this number then becomes even smaller. Another factor is regular tweeting - across your full customer base, perhaps only 7.5 per cent tweet frequently, giving you 750,000 known customers who are active on the micro-blogging site.
If you get a significant number like this, you can then apply segmentation and analytics to provide valuable insights into whether social customers are more valuable than non-social customers. This might identify groups who are buying a specific range of products or services and then going online to talk about them. “Often people who over-index in terms of buying particular products also have a high influencer score in that category,” says Ballard.
To put the numbers into context, explains Ballard, according to Twitter only 1 per cent of your followers see your tweets. "So you have to consider, when looking at the return on investment from seeking out the connected customer, can you reach enough of them to make it worthwhile?” he asks.
If you’re talking about 7,500 customers with a high propensity to spend on a high value product, then, says Ballard, it probably is worth investing in marketing to them. These people are the prime candidates for highly targeted, relevant and personalised customer communications, often built around propositions created just for this segment. This is where you start to connect social data with other data sets and channels, to create a richer, more relevant communication for customers, driving higher ROI. And as email can be highly persuasive, it may also yield viral opportunities as people forward interesting content to their peers.
Across the dozen brands on which Ballard works, matching customers to their social identities is still in its infancy and often viewed as a test-and-learn opportunity, rather than as a fully commercial marketing exercise. Even though matching your customer data with social media channels can help determine which channels will give you the best ROI, you still need to invest in a good content strategy to make your investment really pay off.
Says Ballard: “Content is king in the social environment. You need to have content and something of value to give to your followers; then build a relationship with them. It is 95 per cent gaining interest through your content and only 5 per cent sales messaging. That feels like a good balance.”