In an article titled What Is the Right Way to Measure Your Twitter & Vine Marketing?, HubSpot writes:
“We like to call it closed-loop reporting. Closed-loop reporting on Twitter is the process of tracking the path of a user who clicks on a link in a tweet, visits a page on your website, completes a form on a landing page to become a lead, and, ultimately, converts into a customer — so you can directly attribute customers to your Twitter marketing, and evaluate the effectiveness of Twitter as a marketing channel for your business.”
My take: Nope. Sorry. Wrong way to measure Twitter/Vine ROI.
Why is this wrong? For one, it ignores how someone came to see the tweet in the first place. Without knowing what other messages/media a prospect has been exposed to, attributing the sale to Twitter is inaccurate.
But there’s something else missing from HubSpot’s methodology. None of the comments on the blog post mentioned this (as of the time I read it), and it’s really too bad that there aren’t more (any!) people calling them out over this.
The missing element: Cost.
Folks, you cannot — I repeat CANNOT — measure ROI without measuring cost. Cost is the “investment” component of the ROI formula. Sadly, too many social media gurus choose to ignore that.
It’s mind-boggling that the HubSpot makes no mention of capturing the costs involved with using Twitter/Vine as a marketing channel. The cost of sponsored tweets (if used) are easily measured, but allocating the costs of shared (or even dedicated) resources to the channel is no easy matter.
So what should marketers do? The best answer might be “nothing.”
Accurately measuring the ROI of marketing investments is tricky business. Assume for a moment that you have a $10 million marketing budget, and 40% is in mass media channels, 30% in direct marketing, 25% in various other media/channels, and 4% in social media (excluding Twitter), and 1% in Twitter.
Is your time best spent figuring out the ROI of the 1% or the ROI of the 70% in mass media and direct marketing? Right.
Back to the ROI drawing board.