Key takeaways

Sam emphasized that we need to start by driving social content and interactions with consumers closest to where commerce occurs, near the points of interaction between the brand and consumer. This brings everyone into the conversation, even those who do not contribute, and helps all become better informed. After determining where/how to collect content, determine where to amplify this content. This should also occur nearest to the product purchasing path. Bring the content in to where they are looking to buy. When you do this it makes it a lot easier to measure the effectiveness on the purchasing decision.

When measuring ROI, the closer you align to the P&L, the better. Helpful analysis to perform should be around visits, conversion, AOV, revenue per email, click-thru rates, return rate reduction, customer satisfaction, brand loyalty, intent to buy, etc. Sam also recommends a methodic approach when implementing your social commerce strategy. Start with one program, measure its effectiveness, add to it, measure, and repeat. Ensure the successful growth of your strategy by measuring along the way.

When implementing Bazaarvoice Ratings & Reviews and Ask & Answer, JC Whitney identified their key high-level objectives then evaluated how social applications would help drive those goals. They determined the specific metrics to measure, put analytic tools in place, and created an ongoing action plan.

Geoffrey shares these metrics across the company, so everyone feels the impact on the business – he got several departments involved at the beginning of the project.

JC Whitney increased sales of 4- and 5-star products by 8-16%. They improved ratings of low-rated products by 37% when working with external vendors, and they reduced product returns by 80% among products with more than 20 questions and answers.

The bottom line? JC Whitney has many happy people across many areas of the business.
If you missed the webinar, ask your Community Manager to send it along.

You will hear real world examples from JC Whitney Company, the largest direct marketer of auto parts and accessories. Join Geoffrey Robertson, VP of E-Commerce, JC Whitney, and Sam Decker, CMO, Bazaarvoice, to understand how to measure ROI in the real world.

You will learn:

• Why metrics are important and how to get started
• Which metrics matter most to prove ROI
• How to use ROI to gain buy-in throughout your organization

Webinar:  Prove It: Real-World ROI for Social Commerce
Date:  Wednesday, January 21, 2009

UPDATE – January 22, 2009:

“Prove It: Real-World ROI for Social Commerce” was a terrific, informative webinar. Many thanks to Geoffrey Robertson of JC Whitney and for the many thoughtful questions from the audience.

Request a recording of this webinar today.

This is the tenth in our series of key takeaways from some of the presentations and panel discussions offered at the Social Commerce Summit in May 2008.

Our very own Brant Barton gave Summit attendees a quick rundown of Seven Deadly Moves to earn your black belt in social commerce analytics:

1. Measure contribution
2. Measure consumption
3. Measure search and navigation
4. Measure customer acquisition
5. Measure marketing
6. Measure sharing
7. Measure returns

Make sure you get the full picture with all of these metrics! From the very beginning, we encourage our clients to set up web analytics software to carefully measure their return on investment. Those that commit to measuring all aspects of their user-generated content functionality gain great insights and even better results.

Learn about our partnerships with web analytics providers and others that help amplify our clients' success on the Radius area of our website.

There’s a lot of buzz about word of mouth. It’s not surprising. Customers are exposed to thousands of marketing messages and trust each one less and less. Customers also are paralyzed by product choice: Search “Stapler” on Froogle.com and you’ll find 25,000 results. Naturally, we’re turning to each other to make wiser purchase decisions.

Marketing executives have noticed. CMO magazine reported that 43 percent of U.S. executives cite word of mouth as a top strategy for the coming year. But that doesn’t mean they know what to do about it. And it doesn’t mean that once they find something to do, it will stick.

Ironically, very few marketers actually are focused on word of mouth. Though the Word of Mouth Marketing Association has seen tremendous growth this year, the ideas and strategies of word of mouth have not seen the light of day across the entire marketing department.

How can something so important to a company’s success fail to get the attention of multiple functions? The problem is in the nature of a corporation and the nature of the topic.

Picture two cliffs and a gorge between them. On one cliff is the ostensibly right-brain ambiguity of “word of mouth.” We live this instinctively every day as customers, spending roughly 30 percent of our conversations spreading word of mouth and always seeking it out. On the other cliff is the left-brained, financially grounded operational process and systems that are the corporation. And we live on this cliff every day at work with our colleagues.

Any employee can “get” that word of mouth happens and that it affects business success. We all give it or get it as customers. But in our daily jobs, few people consciously focus on aspects in their business that can impact, influence or improve word of mouth. Yet everything we do at work impacts the quality of our products, services and systems … which impacts word of mouth.

What’s missing is a “bridge” between these two cliffs. An operational strategy for word of mouth sets forth a set of ever-present processes that employees (and their bosses) have to operate by and react to daily.

Occasional research insights are important to guide the corporate ship like a compass, but not enough to sustain its course. Have you ever sat through a comprehensive two-hour research presentation, rich with customer insight? Maybe attended a focus group or usability study? You may walk away inspired, perhaps with a few customer-centric action items. But in a week you’re back to the day-to-day grind, focusing on internal measures, making decisions in functional silos and operating without “customer oxygen.”

To put word of mouth on a conscious, operational level inside a business, the strategy needs a frequency and reach that we know works with external marketing. You develop a program that makes the word of mouth improvement ever-present, visible and participatory for your colleagues (not just you). Specifically, this is a program — not a project, not a campaign, not a promotion. It’s not one presentation, a focus group, or any short-lived effort that is forgotten when everyone goes back to their day job.

For a corporate system to swallow a healthy dose of customer centricity, a program needs to be candy-coated with operational flavor: processes, metrics, owners, dates and accountability. It becomes a process that we can improve, which is something we can understand in our work lives. Your managers, colleagues and employees can feed on daily customer-centric tactics, and insights are part of their job and performance. While we’re at it, let’s reinforce the importance of word of mouth by putting customer-centric metrics at the top of that weekly executive dashboard. \

We didn’t know what to expect then, but we do now.

Across many clients in diverse industries this “U” curve turns out to be more like a “J” curve…almost a reverse "L" (see below). The average rating across all clients is 4.3 out of 5 stars. The distribution looks like a J, where there are more 1s than 2s, but far more 4s and 5s than the lower ratings.

Why is this? Aren’t people more likely to share their word of mouth about bad experiences? Perhaps they are more likely to share negative opinions when they have personal experiences with a company (service, sales) than the product they buy?

And perhaps customers are interested in sharing their opinion about great products they buy, because there are so many mediocre products. So there’s some satisfaction in sharing the news when we find a product we love.

We’ll learn more and share more here. But in the meantime, this “J” curve is part of the answer to the conern: “What about negative reviews?”