What GM Teaches Us About Social Media ROI

General Motors recently announced that they figured out how to track social media ROI.  Given that much of what people claim is social media ROI is REALLY brand awareness, loyalty and positioning, among other soft ROI indicators, is there something that GM knows that we don’t?

Here’s the gist of the article: for two of GM’s automotive brands, GMC and Buick, consumers can now go to their website and utilize a vehicle-configuration tool, and then post the custom car from the tool to their Facebook page to solicit feedback from friends.  In addition to seeing responses from friends on Facebook, consumers also can see them in the configuration tool.  GM will be in essence spying on this activity to see what configurations are “liked” by consumers and their friends, and then “will also be able to tie those metrics to purchases.”

I’m curious HOW they plan to tie those metrics to purchases, as they then go on to say they they do NOT “have mechanisms in place to remarket to consumers who build and share a vehicle, other than messaging to those who “like” the brands’ Facebook pages.”  At least GM acknowledges that “likes” on a Facebook page or playing around with a configuration tool are not ROI:

“The ultimate gold standard is to be able to connect how people are engaging on GMC.com and with the tool and ultimately be able to lead that into sales and how this tool helps to facilitate sales at the bottom line.”

Since GM doesn’t tell us how they’re doing it, we can only speculate.  What we do know is that GM obtains permission to access consumers’ basic profile when the user connect their vehicle design with their Facebook account, and GM may use some of this information shared publicly to tailor future marketing communications.  As an exercise I want to think thorough examples of how ROI can be measured in this situation.  I will further break it down into soft ROI and hard ROI, as well as what metrics I’m certain GM can access and what is my speculation (noted by asterisk).

Soft ROI

  • # of “likes” on the brand pages
  • # of consumers who use the auto configuration tool on the websites
  • # of consumers who share their custom car design with their Facebook friends
  • # of Facebook friends who “click,” “like” and “comment” on the custom car designs
  • # of Facebook friends who “pass-along” the content from one person to another*
  • # of variations of car designs
  • # of likes per variation (qualitative “comments”can also be coded)
  • segmentation of most liked car designs based on other gathered information (e.g. male/female, age ranges, geography)
  • # of configuration tool visits and duration of engagement
  • source of traffic, other pages visited and in what order
  • whether the brands/the promotion are being talked about online (e.g. tweets, blogs, press)
  • whether the brands are being talked about more than competitive brands
  • # of consumers who visit a dealer month over prior month, year over prior year
  • # of consumers who use the configuration tool who own a GM car currently*
  • # of consumers who submit or call for more information on their dream car*

Hard ROI aka the “Gold Standard”

  • # of consumers who visit a dealer and show a copy of their dream car or mention the tool*
  • # of consumers who already pretty much know what they want, due to the tool, saving agent’s time*
  • # of consumers who redeem coupons/offer codes*
  • # of buyers who respond in a follow-up survey that the tool had a significant bearing on their purchase*

In summary, there are certainly a lot of opportunities to measure the soft ROI of social media marketing integration and, while more challenging to link these activities to hard ROI — money earned or resources saved — it’s not impossible.  If you have any thoughts of your own to fill out these lists, I’d love to hear them!

  1. Micchael Paul, Atlanta
    July 30th, 2011 at 23:45 | #1

    This is such a timely post. Just today, I was having a tough time explaining the social media benefits to a lay person, but this article really helps. Great job

  2. August 2nd, 2011 at 08:29 | #2

    Soft ROI!? Really. Can someone please show me a finance book that defines ‘Soft ROI’? There is no such animal. As described, ‘soft ROI’ sounds like KPIs – Key Performance Metrics. KPIs are generally used to track business progress but are not typically as critical to the business as SLOs – Service Level Objectives. SLOs typically boil down to measures of growth, revenue and profitability – the stuff that enables ROI measurement. KPIs are often indicators of likelihood of achieving SLOs – thus they are useful in terms of measuring progress — but they certainly cannot be used to quantify ROI for the simple reason that there is no ‘R’ to speak of.

  3. August 2nd, 2011 at 12:56 | #3

    Rebekah –

    Thanks for the response. I read your links and the CIO Update with interest. Maybe I am a purist… but there is no such thing as “soft ROI”. If an activity does not generate quantifiable financial returns, then the ‘R’ is zero and, therefore, the ROI is negative.

    It is perfectly OK to engage in activity that does not generate ROI — as long as we don’t try to fool ourselves – and more importantly, we don’t try to fool others into believing otherwise. “Feel good” activities are perfectly fine, but they are an expense that is unlikely to generate a Return (the ‘R’ in ROI). Classify it as such. Spend if you must. But recognize that there is no ROI in “making others feel good about their communities” unless there is a link to your revenues (and more precisely, net cash flow).

    Just make sure that there are enough positive ‘hard ROI’ initiatives to pay for all of the ‘soft ROI’ projects.

  4. August 2nd, 2011 at 13:30 | #4

    @Serge Milman | OptiRate

    Hi, Serge.

    If there were no such thing, it wouldn’t be widely published as terminology. You read the CIO Update yourself, and I assure you if you search on the term you will find it.

    Those successes leading TO the end result are important and necessary steps in the process of achieving hard ROI and can be classified by the term “soft.” There is a “return” in those cases, just not the end-result (yet!) of increased revenue or savings. Whether you want to call them KPIs or soft ROI…tomato, tomatoe…potato, potatoe.


  5. Jim Matorin
    August 14th, 2011 at 06:15 | #5

    Two thoughts this morning:
    1.) “What is the ROI of social media?” This statement is getting as stale as “At the end of the day.” I think after all I have been reading and this post, ROI is morphing its classical definition to some of the different measurements Rebekah has highlighted here. Call it what you want, we are all looking to measure our marketing initiatives, but funny in all the years I have been in marketing, no one ever asked me what the ROI was on a printed sales sheet (POS). It seems to me that social media is another marketing touch point like POS materials, but with greater reach and results.
    2.) I do not think anyone will deny as we navigate the new world of social media, the different platforms enables us to get closer to the customer. Consequently to me customer retention or what is being labeled CLV (Customer Lifetime Value) is creeping up the list in some industries, like mine, foodservice as a measurement that has more meaning than ROI, hard or soft.

  6. June 17th, 2012 at 22:18 | #6

    I guess there is a plus side to everything.. thanks for the post!!

  7. May 28th, 2014 at 03:38 | #7

    I have just finished reading the article you wrote on Soft ROI, Soft ROI indicators & Social media ROI. I want to tell you how much I appreciated your clearly written and thought-provoking article.

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