Coke recently published data questioning their efficacy and ROI (Return on Investment) of their social media marketing program — specifically related to buzz marketing.
Pundits, especially opponents of social media marketing, were quick to use this result to show that social
media marketing doesn’t really improve market performance and is just a waste of time and money for businesses. After all, if Coke, with the largest Facebook fanbase of any business, can’t generate returns from its buzz marketing efforts of Facebook, what hope does the average company have?
Is Social Media Marketing Ineffective?
Even Coke executives, specifically Wendy Clark, a high-level marketing executive at Coke, deny that results show their social media marketing efforts don’t produce sales. Coke continues to believe social media marketing is a crucial element of their marketing mix.
What the study shows, instead, is the problem encountered when developing marketing metrics to monitor social media marketing, then collecting ACCURATE data to support the effectiveness (or ineffectiveness) of any social media marketing strategy.
What is Buzz marketing?
And this is the $64 million. There doesn’t appear to be a clear definition of buzz marketing, what are appropriate metrics for measuring it, and what returns it should generate. Without this, it’s nearly impossible to understand if buzz marketing is working or how to optimize your buzz marketing program. According to Wikipedia:
Marketing buzz or simply buzz — a term used in word-of-mouth marketing — is the interaction of consumers and users of a product or service which serves to amplify the original marketing message, a vague but positive association, excitement, or anticipation about a product or service. Positive “buzz” is often a goal of viral marketing, public relations, and of advertising on Web 2.0 media. The term refers both to the execution of the marketing technique, and the resulting goodwill that is created. Examples of products with strong marketing buzz upon introduction were Harry Potter, the Volkswagen New Beetle, Pokémon, Beanie Babies, and the Blair Witch Project.
OK, got that? Well, it gets more complicated. The AdAge article uses a different definition of buzz — one centered around sentiment analysis.
Sentiment analysis involves automatic coding of brand mentions made on social media. And, that’s part of the problem. Automatic coding requires machines interpret human language and they’re just not that good at it. In fact, Coke studied sentiment provided through their vendor and found it mis-coded positive sentiment as negative 21% of the time. The software was especially bad at coding sentiment from longer posts like on Facebook and blogs.
So, is buzz all that important?
Well, maybe Coke should focus on more than buzz? And, even Coke recognizes that social media marketing provides more bang than what got measured in their study. Plus, the study only looked at the ability of buzz to generate sales in the short-run. We know that the real benefit of social media marketing is the relationship it creates with the brand. Measuring the impact of social media marketing on short-term sales is putting up a straw man.
If you’re interested in knowing more about how to assess your social media marketing program, check out our new social media analytics book. The 1st chapter is available FREE online and I’d love to have your feedback.