This post’s title is a much repeated question and one that is often answered by digital agencies with “What is the ROI of a chair or a phone?”
The chair analogy is perhaps less applicable generally in that in most forward thinking travel companies, chairs are considered to be essential for a conducive working environment whereas spending money on social media is not yet universal.
However, the phone analogy is an interesting one. Many travel companies know exactly what the ROI of a phone is. Well, at least they will know how long it takes to answer a call, how many calls are taken in a day, how many are missed and how many lead to new bookings plus the value of those bookings.
For travel companies who have invested resource and, yes, money in social media, they want to know similar statistics. To some extent this is possible. You can use Google Analytics to see how many referrals on your website are coming from social channels, see where they go on your website and whether they carry out desired actions. For the most part, this information us aggregated and anonymous.
However, CRM is getting more powerful and systems like Webfortis’ Parrot can link behaviour on social networks by individuals with other information held in the company. In the not too distant future, digital agencies and travel companies will be able to say “This is the ROI of social media”.
In a related development, Facebook – everyone’s favourite social network for carrying out secret psychological experiments on its users – has started to trial a Buy button. Yes, that’s Buy rather than Like.
The trial is currently limited to a few small and medium-sized businesses in the US and is designed to “help businesses drive sales through Facebook in News Feed and on Pages”, the company says..
It means that when people see something they like on the network, there is a direct call to action next to what they are looking it and meaning that people on both desktop and mobile will be able to purchase a product directly without leaving Facebook.
This is big news indeed, particularly in an age when getting brand messages across on Facebook is getting harder.
Yet the image of the test Facebook has shared (see at the top of this post) shows a Buy button on a Suggested post i.e. within a piece of paid Facebook advertising.
Facebook has an undeniably impressive and comprehensive trove of behavioural data sitting behind every business page which you access through Insights and its Adverts Manager. Data gathered through the Buy button will surely appear in the same sort of detail.
This development will almost certainly emerge from this trial well. If people see desirable items in their Facebook News Feeds, the convenience of being able to buy it without leaving Facebook should not be underestimated. US companies Lolly Wolly Doodle and Combat Gent have already shown how to sell well through Facebook even without this innovation.
Believe me, this is going to be big and the ROI question may finally disappear.