Category Archives: Twitter

The Stupidity Of Vigilante Tweeting

Learned a new term the other day: Vigilante tweeting. 

According to an article on PR Daily, vigilante tweeting is:

“Getting revenge by publishing the details of a loudmouth’s ‘private conversations’ to their Twitter feeds and other social networks. Let’s say I’m seated next to a loudmouth attorney on a bus one morning, and he won’t shut up about his latest case. I could punish the attorney’s lack of discretion by sending out a ‘vigilante tweet’ containing the lawyer’s name and the details of the case he revealed on the phone.”

My take: I’ve heard of some stupid things before, but this takes the cake. 

First off, lawyers don’t take buses. This kind of blows the whole example the author gives, but let’s roll with it a little longer. 

Second, how is that the author knows the name of this so-called attorney? By the time you’re clued in to some loudmouth’s pri-blic conversation (there’s a term that won’t stick), you didn’t really catch his name.

Third, the vast majority of these loudmouth conversations are not hush-hush details of the government’s case against Taliban terrorists. It’s conversations from some bozo about his drinking exploits from last night. So he probably wants you to publicize it on Twitter for him.

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In the scheme of things, the three reasons above are the weakest reasons for why vigilante tweeting is a stupid idea. 

Here’s the best reason: Because your followers couldn’t care less about this conversation, and would rather not waste their time reading about it. 

Vigilante tweeting is a symptom of a bigger issue in the social mediasphere. 

The problem? Too many people have nothing better to do than sit on a bus, tweet stupid shi*t they overhear someone else saying, and needlessly call attention to themselves (not the loudmouth).

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It’s sad. 

The old mantra of social media was “join the conversation.” Plenty of folks advised social media newbies to “add value.”

Now it’s “hey! look at me!”

I can only speak for myself, but I’m willing to bet that are a lot of people who will agree with me: I don’t care that your plane is delayed, I don’t care that you’re at [restaurant/SBUX/hotel/whereever], and I really don’t care that there’s an effing moron sitting near you talking loudly. DEAL WITH IT. Don’t annoy me with the little things that annoy you. 

Are you really that starved for attention that you have to engage in vigilante tweeting? Are you really stupid enough to believe that you’re somehow “punishing” the loudmouth? 

The only people you’re “punishing” are your followers. And I can only hope that they punish you by unfollowing you. 

The Wrong Way To Measure The ROI Of Twitter And Vine

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.

The Most Misused Term In Marketing

Compete recently ran article claiming that Mobile Twitter Users Are the Ideal Audience for Advertisers. In it, Compete reports that, compared to other Twitter users,  mobile Twitter users in the U.S. are 86% more likely to be on Twitter several times a day and 57% less likely to use Twitter on a desktop computer.

Compete didn’t stop there. A graphic shows a number of other differences:

My take: The term “more likely” is, in all likelihood (pun intended), inappropriate here. In addition, the term is quite possibly the most misused term in marketing.

It’s possible that my analysis — in THIS case — is wrong, but I know for a fact that it happens in the reporting of many other studies. So, if I’m wrong here, my apologies to Compete. But the explanation will go to show why so many others go wrong.

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How did Compete determine that mobile Twitter users are THREE times more likely to use Twitter when commuting?

In all probability (the puns don’t stop, do they), they asked consumers: “Do you use Twitter when commuting?” If 30% of mobile Twitter users and 10% of other Twitter users said “Yes”, then Compete would have concluded that mobile users are “3X more likely to use when commuting.”

If 20% of non-mobile Twitter users use the service at work or school, and and 52% of mobile users do so, then mobile users are “160% more likely to use Twitter at work or school” (32% is 160% of 20%, so added on to 20% equals 52%).

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The problem with all this is that none of it actually captures likelihood of doing something.

How much “more likely” are mobile Twitter users to use Twitter on a mobile device than other Twitter users? Since 100% of mobile Twitter users use a mobile device and 0% of other users do, the answer isn’t calculable.

These statistics (and the underlying questions) don’t capture “likelihood.”

If the question had been “How likely are you to check Twitter before going to sleep tonight?” and 100% of one group said “100% chance” and 50% of the second group said “100% chance” then maybe you could say the first group is twice as likely as the second.

But it seems doubtful to me that that’s how the questions were asked.

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Regardless of whether or not I’m correct in my interpretation in this instance, there’s no denying that this happens all the  time when marketers report out the results of their studies.

[Hell, I do it myself from time to time, and thankfully I have a colleague who is great at catching it and making me change it.]

Marketers may overuse the terms “disruptive” and “transform” and whatever, but I’m throwing “more likely” into the hat as the most misused term in marketing.

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There is another issue with the Compete that bears mentioning, by the way.

It’s bad enough that the term “more likely” is (most likely) being misused.

But the underlying contention that all these “more likely” statistics add to make mobile Twitter users worth focusing on is missing one key element: How big is this segment?

You actually have to click over to the Twitter blog post on this study to find out. There, Twitter says that “60%of our 200 million active users log in via a mobile device at least once every month.”

Hmmm. Those 200 million users span how many different countries? And you, Mr. or Ms. Marketers, are serving consumers in how many of them? 

The key thing to understand here, as a marketer, is what percentage of your customers and prospects are mobile Twitter users, not how many of Twitter’s users are mobile Twitter users. 

It’s conceivable that your customers and prospects that are mobile Twitter users aren’t representative of the total pool of mobile Twitter users. 

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So go ahead, Compete, and hate me for tearing apart your research. Join the club.

Facebook Fans Aren’t Better Customers, Better Customers Are Facebook Fans

Marketers who obsess over driving social media connections (like Facebook likes and Twitter follows) because they see or hear that social media likers/followers are more likely to buy, are better customers, or whatever, are missing an important point:

Social media connections don’t cause the desirable behavior/attitudes — they’re the result of something else. That “something else” is customer engagement.

In a survey of more than 1,100 US consumers, Aite Group asked respondents how frequently they performed financial management activities like creating/managing a household budget, categorizing/forecasting their spending, analyzing the return on their savings and investments, and seeking help and guidance in making financial decisions (there were 13 activities, overall).

Based on their responses, respondents received a score for each activity and an overall Financial Activities Score. That score qualified them for one of three groups (with the percentage of the population each group represents): Level 1: Inactive (30%); Level 2: Moderately Active (50%); and Level 3: Highly Active (20%).

Highly Active consumers (Level 3) are the most likely to:

Grow their relationship with their primary financial institution. Just 4% of Inactive consumers expanded their relationship with their primary FI in the past 12 months (by increasing balances and/or number of accounts). Among Moderately Active consumers, that percentage is 11%, and among Highly Active consumers it’s 14%.

Refer their FI. Highly Active consumers are 1.5 times more likely to refer their primary FI to family/friends than Moderately Active consumers, and twice as likely as Inactive consumers. 

Use and reap the benefits of PFM. Nearly two-thirds of Level 3 consumers use an online PFM tool, in contrast to just one in four Level 2 consumers, and one in 10 Level 1 consumers. More importantly, Highly Active consumers reap the benefits of PFM. In a soon-to-be-published Aite Group report, I defined three levels of benefits that users achieve from PFM: 1) Oversight: The ability to know where their money is and where it goes; 2) Insight: The ability to better control and manage their financial accounts; and 3) Foresight: The ability to make better financial decisions. Among PFM users, Highly Active consumers are four times as likely as Level 1 and 2 consumers to have reached the Foresight level of benefits. The benefit to FIs of PFM users reaching the Foresight level will be described in the report.

Connect with FIs on social media. Among Highly Active consumers, nearly three in 10 are Facebook fans of their primary FI, and one in five follow the FI on Twitter. Among other consumers, those percentages are in the low single digits.  Looking at it from a different perspective, of the customers that follow their primary FI on Twitter, 95% are Moderately Active or Highly Active consumers. Ninety percent of Facebook fans come from these two segments.

Bottom line: Encouraging customers who aren’t actively involved in the management of their financial lives to “Like us on Facebook!” or “Follow us on Twitter!” is a waste of financial services marketers’ time and efforts. The customers who make those connections are already good customers. 

Customer engagement — engagement with one’s financial life — is what financial marketers should be encouraging.

 

 

Here’s What I Believe (About Marketing And Social Media)

I’ve seen a number of posts lately perpetuating a “here’s what I believe” (usually about social media) meme, and I couldn’t help but weigh in with my own post.

Here’s what I believe…

…that just because a company doesn’t adopt social media with the speed and force that you think it should (often based on no rationale or business logic), that doesn’t make that company a dinosaur or a laggard, nor does it mean it will be “left behind” or “disappear.”

…that “conversation” is the most overused word in marketing. Just because someone (who is often just starved for attention) mentions a brand in a tweet (often to complain about the brand) that doesn’t mean that person is looking for, or starting a conversation.

…that marketers who think that brands have “conversations” but say that companies aren’t “people” are hypocrites. You can’t have it both ways.

…that there is no such thing as a social media strategy. There is only business strategy, and an allocation of resources (possibly to social media channels and tactics) to support that strategy. So, if you’re in the business of helping companies with their social media “strategy,” you’re hosed.

…that Steve Knox — who said ”victory in marketing doesn’t happen when you sell something, but when you cultivate advocates for your brand” — is wrong. Any day of the week I’ll take someone who buys my product/service and doesn’t talk about it over someone who talks about it but doesn’t buy it. Any-day-of-the-freaking-week.

…that I have no idea what Mack Collier is saying when he writes “Marketing is a tax that brands pay for not speaking in the voice of their customers.” Huh? I’d hate to be a marketing major in college these days, paying $40k a year, to find out that the business discipline I’m studying is a tax that brands pay for…oh, forget it, I don’t even understand what the rest of the quote is referring to.

…that Twitter is an absolutely horrible advertising platform. One well-known blogger recently called Twitter “a stronger platform for advertisers than Facebook will ever be.” Nonsense. First of all, we don’t want to read. It’s too much effort. TV and radio ads — and increasingly online ads — are verbal. Print ads are predominantly visual. Sure, there are many good text-intensive print ads, but those are typically for certain types of products. Second, there is no accountability on Twitter. The likelihood that someone will see your tweet is actually pretty small. But you’ll never know.

…that Twitter does not make you a better writer. The same blogger referenced in the previous point also said  ”140 character Tweets make you a better communicator and a better writer.” More nonsense. Writing/editing/writing/editing/reading/getting feedback/writing/editing — and repeating the process over and over and over — makes you a better writer.

…that people should think more critically before regurgitating pablum. Like when Mack (sorry to pick on Mack) says “new customers cost 6-7 times more to acquire versus retaining an existing customer.”  Why do people continue to cite this bullshit? Here are some facts: Acquisition and retention costs vary by industry, ebb and flow with economic cycles, and are — for the most part — incalculable in the first place. Here’s a more detailed explanation.

There are probably more things that I believe, but there’s only so much I can try to cram down your throats in a single blog post.

Do Your Tweets Suck?

Here’s a random thought: I wonder how good my tweets are.  I really should be asking all of you: How good do you think my tweets are? It turns out my tweets are a model for everyone else! If you want proof, here’s some good information:

Seriously, if you want to know what makes for good tweeting, re-read that first paragraph a few times.

According to a few researchers (translation: people with nothing better to do), just 36% of tweets are worth reading. Which means that, for some of you, your tweets must really suck, because I know that 100% of my tweets are worth reading.

How do I know? Well, our esteemed researchers discovered that the best tweets fell into four categories:

1. Random thoughts
2. Self-promotion
3. Questions to followers
4.  Information sharing

The worst tweets were in the following groups:

1. Opinion/complaint
2. Conversation
3. Presence maintenance
4. Me now

My take: What the research is basically saying is this:

  • No one cares what problems you’re having. Stuck in the security line at the airport? Too fu*king bad. Tell it to the person next to you.
  • No one cares what you have to say to other people. If the conversation doesn’t involve me, your conversational tweet bugs the crap out of me. And now I know that I’m not alone in that opinion.
  • No one cares where you are, what you’re doing, or what you’re eating. If you’re thinking of tweeting one (or more) of those three things, do us all a favor and don’t.
  • No one cares about you. Period.

Reading this article on the HBR site was a huge relief for me, because it confirmed what I had suspected all along: My tweets don’t suck.

What’s The Value Of A Social Media Guru?

A recent article on FutureLab reported on some “math” computed by cloud data backup service Backupify.

To compute the value of participants to various social networks, the firm divided the estimated valuation of the company by the number of users of each social network, and called the result the “value each user contributes to the company’s value.”

It found, for example, that the value of a Facebook user is $118, roughly $46 more than the value of a Twitter user, and about $100 more than the value of a Yelp reviewer.

But Backupify didn’t stop there, no siree.

It took each company’s estimated annual revenue and divided it by the interaction volume. This calculation revealed that a Yelp review is worth $9 to Yelp, while a tweet is worth $0.001 to Twitter.

My take: If I have to explain the idiocy of these calculations, please leave this site immediately. You are not worthy to read this blog, nor to interact with the intelligent people who regularly read and comment on this site.

Oh, and when you leave this site, please follow me on Twitter, and start tweeting a few thousand times to help Twitter increase its valuation.

This approach to the valuation of social network followers did make me wonder, however: What’s the value of a social media guru?

The Value Of A Social Media Guru

I have developed a formula that I believe could become the industry standard. Maybe it will come to be called the Snarketing Index. (Oh stop dreaming, Ron)

Here’s how to calculate the value of a social media guru:

1. Take the guru’s number of Twitter followers.

2. Add his/her number of Facebook fans.

3. Add the number of his/her blog subscribers.

4. Multiply by average number of mindless, patronizing comments per blog post (“Great post!”).

5. Multiply by the number of times “Book me to speak!” appears on guru’s blog.

6. Multiply by the number of times a blog post titled “What Pinterest Means To Brands” appears on the blog.

Still with me? I know this formula is getting complicated, but I have an MBA in Finance and Statistics so I know what I’m doing. There’s one more step to calculating the worth of a social media guru. After you arrive at the total produced by Step 6:

7. Multiply by ZERO.

Two Types of Social Media Gurus

It seems to me that there are two predominant types of SM guru:

1. The guru who applies old-world marketing concepts to social media channels (“increase your reach with Facebook!”)

2. The guru who applies absolutely no prior marketing experience or concepts to social media (“social media will revolutionize marketing!”)

It’s amazing to see what these folks say and not only get away with, but get quoted as if it’s something brilliant.

In one recent interview, a well known SM guru said “most companies’ think Big Data is most easily deciphered by tag clouds.” Oh really? Mr. Guru really needs to start talking to a wider variety of firms.

He’s also quoted in that interview as saying:

“We’re 5-6 years into the evolution of social media marketing, and most brands still suck at it.”

That’s an interesting comment. We’ve been doing mass media marketing for how long now? Sixty years? Have we perfected it, got it right, or stopped “sucking” at it?

Exactly how long should it have taken to get social media marketing right?

Maybe most brands still suck at it because the advice they get from social media gurus suck. Did the gurus ever consider that? Of course not.

The Real Value of Social Media Gurus

Despite my skepticism of the value that SM gurus provide, I will concede that there is one potentially important role they play: Catalyst.

I learned this lesson from a USAA exec. We were chatting over drinks (well, at least, I was drinking), discussing some research published by a former colleague of mine, research that I really didn’t find to be of particularly high quality.

My USAA friend said: “You don’t get it. I don’t care if the research is any good or not. It helps me prove the importance of what I’m doing to my bosses.”

He was right. I didn’t get it. But now I do.

So use these SM gurus to help you prove the importance of SM if that’s what you’re trying to do. But take what they say with a grain of salt, and a heavy dose of skepticism.

Twitter: Like Being Badgered By A Drunk On A 24-Hour Bus Ride

Canadian politician Charlie Angus made headlines recently for quitting Twitter. Apparently, Mr. Angus said that Twitter is like:

“Being badgered by a drunk on a 24-hour bus ride.”

Mr. Angus blamed the “dumbed-down nature of the conversation” for his departure from the social networking tool. The Globe and Mail quoted the politician as saying that “only about 5% of what he was seeing on the social network was worth it.”

My take: Mr. Angus’ comments made me wonder: HOW WOULD HE KNOW? After all: Mr. Angus ONLY FOLLOWS (uh, followed) 54 PEOPLE!

In statistical terms, this would be considered an insufficient sample size.

But this begs a deeper question: Who was Mr. Angus following, and what were they tweeting that led Mr. Angus to his conclusions about Twitter? A quick look at his Following reveals that he followed:

  • HuffPost Canada. Well, this explains the “dumbed-down” comment.
  • Not one, but two, Stephen Harper-parody accounts. What was Mr. Angus expecting from these accounts, deep philosophical discussions?
  • Music Canada. According to its Twitter bio, it represents “Canada’s Major Labels.” I know I’m going to get some well-deserved grief for this comment, but — here goes: Canada has “major” record labels? Muwahahaha.
  • @TallTree_1173 (Northern Ontario Turtle Island). @TallTree-1173 has only tweeted 357 times, and most of them are either tweets to, or retweets of, Will Smith.

Most the remaining accounts that Mr. Angus follows are political-related, so, really, is it any surprise that he would conclude the nature of the conversation on Twitter is dumbed-down?

Bottom line: There are two conclusions to take away from Mr. Angus’ departure from Twitter:

1. Your Twitter experience is dependent upon who you follow.

2. Despite his limited and skewed sample, Mr. Angus was right.

Do CEOs Really Need To Tweet?

A newly-released study on the impact of tweeting CEOs garnered some eye-catching headlines:

“CEOs Who Tweet Held in High Regard” (eMarketer)

“CEO Engagement on Social Media Positively Impacts Brand Image, Trust and Purchase Intent” (MarketWatch)

“Study: 74% Of Respondents More Likely To Buy From Companies With CEO Social Media Engagement” (The RealTime Report)

“The Benefits of CEOs Who Tweet are Legion, Survey Finds” (TechVibes)

Pretty compelling stuff, no?

The write-up from eMarketer (a source I find particularly credible) said:

“Survey results indicate that consumers believe C-suite engagement in social media can benefit how they view a brand and its executive leadership. The majority of survey respondents, 78%, said CEO participation in social media leads to better communication, while 71% said it leads to improved brand image and 64% said it provides more transparency.”

My take: There’s something fishy going on here.

Intuitively, these claims are little hard to swallow.

At the moment, public sentiment is clearly against large banks. If Brian Moynihan, CEO of Bank of America, were to start tweeting, would that sway public opinion in favor of the bank?

Or let me ask you this: Do you think the average consumer knows who the CEO of Procter & Gamble is? Of Southwest Airlines? Of McDonald’s?

These companies are all on Fortune’s list of Most Admired Companies. How much would consumers’ purchase intent in these companies improve if the CEO tweeted? What could the CEOs possibly tweet that would increase brand image?

I guess if Southwest’s CEO tweeted news of each flight delay that might help the airline appear to be more transparent. But this presumes, of course, that every SWA traveler follows the CEO, and — even more importantly — is glued to Twitter every second of the day.

Here’s the point: Real people don’t care THAT much about Twitter. Real people don’t check their tweet stream constantly to see what CEOs are tweeting.

And this is why the headlines emanating from the study smell so fishy: Because the firm that did the study didn’t survey real people!

Just one of the sources listed above even bothers to indicate who was surveyed. Most simply refer to “xx% of survey respondents.”

The clue, however, is provided in a chart on eMarketer’s site. In it, we see that respondents were “employees of Fortune 1000 companies.”

Which employees? A random sample of Fortune 1000 company employees? Or was it the marketing and PR people in those companies, people whose opinion on the benefits and impact of CEO tweeting might just be a tad skewed?

Bottom line: This study does not prove that CEOs could improve their firms’ brand image or purchase intent among consumers. 

Reality: There are far better things for CEOs to be doing than tweeting. 

However: There are times when CEO tweeting can be effective. 

A scheduled TweetJam could be a great way for a company’s customers to interact with a Fortune 500 CEO at some scheduled time (this is very different from being an “active” Twitter user, however).

During a crisis, establishing a twitter presence may very well be an effective way of communicating with the public to keep them up-to-date on the issue, and to have crisis-related messages disseminated through retweets. 

I don’t doubt that for a few CEOs (e.g., pseudo-celebrity types like Zappos’ Tony Hsieh), tweeting is a way of connecting with customers and building brand presence. But to conclude — especially based on the study mentioned here — that it’s universally applicable, is foolish.

The bigger question, though, is: How can CEOs better communicate with constituents (i.e., customers, employees, investors, etc.)? Is a channel that limits messages to 140 characters and provides no indication if messages are seen or read really a good channel for communicating? 

In that regard, Facebook may be a much better alternative for CEOs than Twitter.

p.s. Shame on all the publications citing this survey for not doing their homework, and misrepresenting the findings of this study.

Social Media Malpractice

Imagine that you went to a doctor who gave you bad advice, and as a result, you either became more ill, or didn’t get better. You’d sue for malpractice, wouldn’t you?

I want to know how to sue social media gurus for the lousy advice they give.

This latest example of social media malpractice is so egregious, it makes me wonder not just how the purveyors of this bad advice survive in the market, but who the hell reads this stuff, and finds it valuable. The example I’m referring to is an article titled 5 Simple Steps to Measure Social Media ROI on Social Media Today.

Let’s dissect the stupidity:

1. Determine Your Social Media Spend (SMS). Social Media Today: This includes hard and soft costs, including your time. Yes, time! Despite what social media zealots say, social media is not free. Count it all.

My take: Right off the bat, we have an issue: What exactly are we measuring the ROI of? When you calculate the ROI of a direct marketing campaign, do you allocate every little cost that the organization incurs? I mean, if the cleaning crew didn’t clean the office, then maybe marketing couldn’t execute a campaign. Ideally, you would allocate all costs (hopefully, based on an activity-based costing model) to individual campaigns. But we don’t, because what we’re really trying to capture is the ROI of the incremental investment made. The fixed costs are sunk, given.

The same principles apply to social media. What we really need to measure is the ROI of social media campaigns. Ideally, we would allocate the cost of social media infrastructure, but what’s more important is to understand the ROI of individual social media campaigns — not just social media as a lump sum investment.

But there’s another issue here: Sometimes social media isn’t a standalone campaign, but a contributor to an existing effort or initiative. So to calculate SM ROI we’d need to know the ROI of the initiative or investment without a social media component. Good luck with that. 

2. Determine your Customer Lifetime Value (CLV). Social Media Today: This is a terribly important metric, yet most companies don’t know it. Know it. Marinate on this: If I buy your $200 shoes and go away forever. I’m worth $200 to you. If I buy your $200 shoes and you keep in touch with me, inspiring me to share my experience in social media, and 30 people buy your shoes as a result of my endorsement, my CLV just shot up to $6,100. Ask your current customers how much they roughly spend on your product each year, then, multiply by 20 to arrive at their CLV.

My take: HUH? Ask your customers how much they spend then multiply by 20 to calculate CLV? Are you serious? CLV is a near-impossible metric to calculate. Marketers generally have little insight into how long a customer will stay for, how their spending patterns will change over their tenure as a customer, what the cost to serve that customer is and will be, or figure out how much business a customer influences through referrals.

But let’s assume for a moment that you could get a handle on this variables. What exactly is SMT asking us to do when it says “Ask your current customers how much they roughly spend on your product each year, then, multiply by 20 to arrive at their CLV”? Different customers will have different CLV. Are they asking us to aggregate this amount? Average this amount? Calculate CLV by different customer segments? What exactly is SMT asking marketers to do?

3. Determine New Customer Value Via Social Media (SMV).  Social Media Today: Track conversions using Google Analytics or any other website tracking software. Google Analytics allows you to slice by social. This takes time, but it’s necessary if you want to understand your ROI from social media. Track sales, conversions, etc. and place a value on those items. For some, it might be hard-dollar sales; for others (typically B2B): the value of a contact form submission.

My take: HUH? What’s the value of a “contact form submission”? Is this average revenue or sale amount per new customer? Someone is going to have to explain this to me, because this makes no sense at all, as written.

4. Determine Impression Value (IV). Social Media Today: There is value in impressions; it’s what traditional media sell. To determine IV, add up your impressions from Twitter and Facebook, cumulative YouTube views, website traffic and any other online source. Divide that total by 100 and then multiply by an industry-appropriate CPM (cost per thousand impressions).

My take: Gag me. Using this logic, the ROI of direct mail campaigns should include a value for anyone who read the DM piece, even if they didn’t respond or buy. Impressions may be a metric worth calculating — but it isn’t a metric that can be used to calculate ROI.

5. Calculate Customer Service Value (CSV). Social Media Today: Twitter and Facebook are arguably the most efficient, cost-effective, forward-facing customer service platforms ever created. Social media can reduce customer service costs – in the form of inbound call deflections – which is a tangible value. This is a subjective one, but you need to take a crack at valuing it. For example, if you feel like Twitter provides $1,000 of customer service value a month to your business, write that in. It matters.

My take: You’ve got to be kidding me. “Social media can reduce customer service costs – in the form of inbound call deflections – which is a tangible value.” Hey Social Media Moron: A customer service-related tweet or Facebook post IS AN INBOUND customer service interaction. The problems don’t fix themselves. There may be a reduction in telco costs, but, today, in large firms, that cost savings is negligible

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Social Media Today goes on to say:

Now, let’s add up that Investment Return (IR), shall we? (Customer Value/10 (years) x Number of New Customers) + Impression Value (IV) + Customer Value Via Social (SMV) + Customer Service Value (CSV).

Social Media ROI = Investment Return (IR) – Social Media Spend (SMS) / Social Media Spend (SMS).

Et, voila!

Bottom line: This is an example of nothing more, nothing less than Social Media Malpractice. Or better yet — management consulting malpractice. Anybody who buys into this crap deserves what they get.