Interesting tweet to day on Karen Bartelson's Twitter page. She ponders a survey's question on how much Synopsys will spend on social media this year. She calls the question a "non sequitur since most of social media is free?"
That is a common misconception, but mostly because most people discount the human cost of social media AND they have a limited understanding of what social media actually is. Let's deal with that last one first.
Social media is any medium that elicits a response from the audience through the medium. Funny thing is, if a newspaper publishes a letter to the editor on a topic that paper covered, that means the newspaper is a non-electronic social medium. Radio and television call-in shows also qualify. Take another step up to email. If you respond to a piece of spam -- even if it's to pass it on to someone else -- that makes your email a social medium. Your website is a social medium if you put contact information on it and someone responds to it.
But here's a real interesting question: If you have a blog that no one ever comments on, is that blog a social medium or a public personal diary? That's a parallel to koan "if a tree falls in the forest, does it make a sound if nothing is there to hear it?"
So let's go back to the question of cost.
How much time are you spending on social media as described above including email, blogging,reading and responding to blogs, Twittering ... chatting, telephone conversations and texting (yessss, that qualifies)? How much do you get paid? What is the percentage of your time spent on those activities? That percentage of your paycheck is an investment in social media.
Beyond that, how much are you spending on web/blog design and maintenance? How much on server time and equipment? How much on connections? When you stop to think about it, in today's age, everyone makes some sort of investment in social media in either time or resources, not just cash outlays. And when all these social media companies realize that advertising is not paying the bills, they only choice they have is to start charging for their services, so as far as what you are going to invest in social media, the only answer is -- more than you are now.
There is a relevant question in all of this, however, that is not being asked. What is really the return on investment in all of this social media activity? That's something only you can answer because you have to determine what is really valuable. And once you have that figured out, you are going to have to figure out how to measure that value. That's where most people fall down because they really don't know what is valuable.
Some companies say they are looking for leads out of their social media investment, but then they say that about all their marketing efforts. The sad thing is that 99 percent of those companies never follow up on the leads they gather, so the leads have no real value. A sliver of the remaining 1 percent actually use the leads and track them through to sales, so they can apply a dollar amount to their efforts.
The real value of social media, however, is influence and that is much more difficult to measure. Companies like Xilinx and Cadence who have hired experienced journalists to participate in their communications programs, understand the value of influence and even the impression of objectivity.
In the end, what you have to realize is social media is about people and what you are investing in relationships. You get nothing out of it until you actually get some sort of dialog going. For example, right now I am managing four different blogs: this one, New Tech Press, one on local politics and one on theology. That doesn't include what I do on Twitter, Facebook, Myspace, LinkedIn and Plaxo. Which one do you think brings in more potential business? You might be surprised at the answer.
All of them are equally productive. The relationships I build in each tend to migrate into what could be professionally advantageous. I've been able to discover markets outside of EDA and semiconductors that my skills and expertise migrate easily too. I'm talking with green construction companies, investment firms, real estate brokers, biomedical firms, graphic acceleration software... all kinds of interesting companies, all of them from one or more of those blogs. Can I state that ROI is clear dollar amounts? Nope. But I will be able to by the end of this year.
And by expanding my circle, so to speak, I've found out that the world economy is not quite as bad as CNN wants to report it to be. There is innovation and invention and ... investment happening all over the place, even if it isn't in the little corner I've been inhabiting for the past 10 years.
So what's the ROI of social media? Maybe a greater perspective and greater opportunity than with how it all used to be done. That's worth putting some money into the mix. If your manager asks how much you think you should be investing in social media, the answer should be, "A lot more than we are now."