How Do Price Changes Affect Consumer Perceptions?
By Kara FinnertyJun 1
In business, the bottom line is just that — the bottom line. The end all be all. The light at the end of all tunnels. Show me the money, honey.
This is fairly easy to measure — simply look at revenue sales of your product or services. What is more difficult for businesses to measure is Return-on-Investment (ROI). What’s more difficult? Measuring ROI from that omnipresent entity we know and love. Social.
The tough questions require the smartest minds to crack the case. In this fourth installment of our social consumer and market insights blog series we’re getting right to the important stuff (you can check out the last post here).
We asked James McCormick, Principal Analyst serving Customer Insights Professionals at Forrester Research, to shed some light on the following question.
How are consumer insights teams able to prove ROI to the C-suite and underline the value of their work?
The old adage, “you can’t manage what you don’t measure,” comes to mind. For customer insights teams, you need to able to measure the impacts — and ROI — of applying insights to critical business decisions. There are many ways of doing this, but there is commonality among all successful attempts.
It starts with agreeing with business partners on what they want to achieve with any initiative that you want to drive insights with. For example, within a social media context: Do you want to improve brand perception or product discovery? Do you want to boost midfunnel conversion, or is it lower funnel sales? Do you want to increase product consumption? Whatever it is, make sure the insights team, technologist, and business folk agree on what success looks like.
Then take time to properly measure and baseline the pre-campaign level of sentiment, brand awareness, conversion, product consumption, or whatever the indicator of business success is. Only once you have a baseline should you then apply your insights-driven approach to boosting your chosen KPIs. Once applied and completed, measure against the impact of the activity on your KPIs. So, in summary: Measure, baseline, apply an insights-driven optimization approach, and measure again. Rinse and repeat to maximize value.
Sound advice from an expert. The first step for any consumer insights or market research professional embarking on a new project is to identify goals and baseline. It simply makes good business sense.
We also queried Ben Schaefer, an analyst on our Research Services team here at Brandwatch, to share his experience on how professionals can navigate the tricky waters of proving social ROI.
BEN: Honestly, I agree with everything James said here. To prove ROI I think the big question that is front of mind for a lot of people now is, “why would we be doing this?” This being social, of course.
There are some business lines and departments that are more reluctant to bring in social data to the research mix. I’ve found in my job working at Brandwatch that I can confidently say social data is for everyone. Utilizing social for research projects, whether campaign or topic based, offers unparalleled flexibility and expands the scope of knowledge beyond what we researchers have had access to in the past.
The insights we can deliver for a brand can be used to prove ROI in a multitude of ways.
In working with one of the most recognizable American insurance and financial services company, we are looking at absolutely everything — with a focus on consumers. When you’re looking at a huge array of topics, campaigns, and consumer matters, you can prove ROI by bringing all of those reluctant and skeptical departments directly into the conversation. When we’re looking at the social data, we can draw insight that pinpoints where a product or service is falling short, or acknowledging where endorsements may not make sense from a regional or demographic perspective.
You can prove ROI easily by bringing all of these different insights together and delivering them to the right departments. An actionable insight that rings the alarm for product R&D, or customer service, or investor relations to make a smart change organically is inherently making a strong case for positive ROI. This can be measured as easily as looking at numbers and results prior to the change and after it’s been implemented.
When I see terms like ROI in relation to social intelligence, it really lights a spark for me to share my knowledge from the field. Proving ROI is the start of the conversation, yet it’s not the whole discussion. Not even close.
Going back to what James said, you have to implement a baseline engagement but also a baseline understanding internally to ensure that everyone in the organization is on the same page when it comes to identifying goals and how social insights will be used to address them through real action and smart business decision-making.
I always think it’s easier to prove ROI to a CMO than it will be to prove to a more market research oriented professional or an engineer embedded in the product team. Marketers are naturally inclined to thinking of projects and work in an ROI context. Yet a technical professional in a different field will need more details about what the data is really saying and will need to be informed beforehand about the research capabilities. This is where setting up an initial baseline really comes in handy.
What does the process look like for getting everyone on the same page?
Researchers need to know every person involved that they are writing a research brief for at the outset of a project. This will affect how it’s written and what details and information need to be included.
For example, if writing with a CMO in mind and they need insights that will also be presented to their board, that content can’t simply be tacked onto a report at the end. As Julie Andrews said in The Sound of Music, the beginning is a very good place to start. Preparation is key to delivering the right insights and findings to different professionals and departments within an organization.
You have to know your audience – and I’m not talking about your consumer audience on social. As analysts we can tend to write from a researcher’s perspective, which isn’t what is necessarily needed depending on who the report will be delivered to. If analysts only wrote for the understanding and knowledge base of other analysts, it would turn into an echo chamber of consumer and market insights professionals talking to each other with no insights moving beyond the theoretical realm of ideas and numbers.
Market researches need to be delivering actionable insights that are written specifically and directly in the language and preference of their audience.
The best way to do this is to avoid jargon and speak in a presentation or write a report in a vernacular as you would when discussing any matter with a non-analyst.
A major part of our job as analysts is qualitative analysis and I think that qualitative analysis is really important in social media beyond just the numbers of it. Retweets and tweets are great, but what do these numbers mean? And why are they what they are? You have to explain the what and the why beyond just numbers to show the value of the insights and your work in market research.
So much of proving ROI for social comes through in the process of identifying what stakeholders really need. I believe that the best way to show the beneficial aspects of any market research project or social insight is to see if there is a positive change after implementing an action that came to light through said insights.
The power isn’t just in the knowing, it’s in the doing.
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