Business Justification

Monitoring and integrating the voices of customers captured in social media conversations with customer input expressed through enterprise feedback management programs delivers both direct and indirect financial benefits. When determining how profitable it is to actively participate in social media and to measure the results, the direct financial gains basically fall intro three categories: incremental revenue, cost savings, and costs avoided.

The non-financial benefits, which look at the value delivered and how the results align with desired business outcomes, are also very important. Some examples are brand loyalty, customer engagement, percent  of lead closures, website repeat visitors, and number of downloads. The premise is that revenues will increase as these improve. Presenting this data in dashboards shows how they correlate, and tracking over time shows whether the relationships continue to hold.

The benefits of participating in social media, monitoring trends, and taking timely action include

Revenue growth (important to measure incremental growth by starting with baseline data for each)

• Directly drives leads
• Increases conversion rate
• Increases new customer acquisition
• Converts buyers to advocates
• Increases average order value
• Faster adoption of new products by current customers

Decrease in Cost of Sales 

• Shorter sales cycle
• Lower cost per lead
• Gain in customers through referrals
• Cost of sales lower with repeat customers

Product Innovation 

• Better understanding of customer and market needs
• Improved ability to target products, based on collective intelligence of wide range of customers
• Development of innovative products, based on collaborative activities with customers
• Accelerated product launch
• Relaunch of products to better meet customer and market needs

Optimized Service and Support

• Faster problem resolution
• Cost reductions for better ROI: fewer calls, increased use of channels other than phone
• Better solutions (from customer community)
• Fewer escalations
• Early problem identification so they can be fixed and escalations can be avoided

Maximizing Marketing ROI

• Increased brand awareness and loyalty
• Increased efficiency and effectiveness of campaigns 
• Reputation management: by identifying and reducing risk to the brand, establising a trusted voice in the market, creating a community for customers
• Appeal to new audience
• Strategy refinement: which products/services to develop, what marketing messages to craft for which audiences, what partnership opportunities to pursue
• Opportunity to reduce market research costs by gaining additional information about customers, competitors, the marketplace

Greater Customer-Centricity

• Holistic view of customers, merging Social Media inputs with other customer attitudinal, behavioral, and demographic data
• New customer segmentation based on expectations, satisfaction levels, preferred channels of communication
• Demonstration of customer focus by participating in and responding to Social Media conversations 
• Process improvements based on customer feedback for every customer touch point

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