Real Magnet

Social Magnet Analytics, Part 2: Answering Questions of Resource Allocation

Last week I wrote about how the new analytics available through Social Magnet can lend some valuable insight into marketing results contributions. For the first time we can see exactly how many clicks from a campaign are attributable to email, and also how many are from Facebook and/or Twitter. This type of data is more than just an interesting topic at the next marketing department meeting. It helps marketers score their various marketing channels for effectiveness in order to determine how future investments (in cash and time) are best spent.

At first, comparisons between channels are likely to be in aggregate, across all messages. Over time, marketers using Social Magnet will begin to see which channels work best for different types of messages. In some cases that won’t mean a change in action – if the objective is to notify your entire audience about a webinar or conference registration deadline it will make sense to use email, Facebook and Twitter, even if one of the three works significantly better. But in instances where social channels work better, marketers may start to thin the number of messages they send to their email list in order to rest the inbox a bit, and save attention in that channel for when it is needed more urgently.

Deciding which channel is ideal for different message types can make a marketing program more efficient, but increased effectiveness comes from investing resources into the channel where they will provide the biggest lift. Here’s where Social Magnet can have a pretty profound strategic impact on your marketing communications.

Let’s say that one of your projects scheduled for next quarter is an initiative to increase the number of your email subscribers. Now that you’ve got Social Magnet, you may want to revise that item on the to-do list to increase the size of your audience. Through the analytics, you may find that each incremental Facebook fan or Twitter follower is worth more than an additional email subscriber, or that the energy required to bring in one more subscriber to a relatively large list would bring in 10 fans or followers to your smaller social channels. One of the ways Social Magnet can help is the response-per-audience across all your lists. For example, let’s say that you have 10,000 people in your email list, 500 Facebook fans and 1,000 Twitter followers. Over the course of a few months you send out 10 messages to each of these groups, all attached to each other through Social Magnet, promoting the same thing and including a link (or at least one link in the email). You get the following results:

Email List:
10 messages to 10,000 = 100,000 messages
1,500 total unique clicks
1.5% average click rate

Facebook:
10 messages to 500 = 5,000 messages
250 total unique clicks
5% average click rate

Twitter:
10 messages to 1,000 = 10,000 messages
750 total unique clicks
7.5% average click rate

You see in this example that Twitter has the highest average click rate of the three, which is not purely hypothetical. Some studies are finding that click rates on Twitter can be remarkably high, with Facebook not far behind. As with all things analytics, how they apply to your business depends on a number of different factors. In this example, the company built out its Facebook and Twitter audiences organically, relying on content to spread and attract people who would be interested in the brand. If they had launched in to a blind follow campaign on Twitter or run thousands of dollars worth of ads and promotions on Facebook, they would have a larger and less targeted audience that wouldn’t yield the same average click rates.

If we stay with the scenario above, this brand might find it worthwhile to put more energy into growing its social channels. Because they are small, the available and untapped audience for them is larger (with the lowest hanging fruit to be found within their own house email list). And each person on the list is currently more likely to respond, or to pass along a message to people who respond (which is a factor in the higher click rate – not all of the 750 clicks on Twitter are from the brand’s followers if the messages are retweeted).

Resource allocation is never binary, however. Deciding to ramp up your Facebook presence does not mean abandoning your email efforts. Social and email work well together, to load balance communications. Social Magnet can help quantify some of the decisions that we face with our communications program each day, replacing many of our hypotheses with actual insights.