Has the Digital Tribe Killed ROI?

ad-age1ROI: It’s that staple accountability measure of any advertising or marketing campaign. How many, how much, at what cost, for what impact…these are the things we need to understand so we can adjust, refine and market again.

The idea of measuring return on investment came about in the mid-1900s “when marketers entered the age of mass media and large campaigns, and they began demanding to know the impact their ads were having on awareness and sales,” writes Andy Frawley in AdAge.

Because the digital age changed everything, Frawley asserts, ROI is hopelessly outdated and ineffective at giving marketers the information they need.

“Marketers want to know even more about how effective their marketing is and its impact on customer relationships,” he explains.

Frawley proposed a net metric called ROE2 (return on experience x engagement), which replaced the short-term ROI with “a longer-term, holistic measure of consumers’ total brand experience and their level of engagement.”

It’s true enough that our customers are using more touch points on more channels, and tracking those touches makes good sense. Anytime we can get a customer to voluntarily give us a digital click based on his or her experience (a like, a share, a tap, a swipe), good for us.

But how does emotion play into this?  In our share-happy, digitally connected world, one customer’s experience – good or bad – becomes brand awareness potential for hundreds, possibly thousands, of that customer’s connections.

Emotions can be stirred up to frantic levels by our digital tribe – just look at the polarizing effects of last year’s Chick-fil-A boycott. When emotions become involved to this level, ROI goes out the window and brand evangelists become socio-political figures. “Experience” and “engagement” in this instance came down clearly on two sides. Do we then have to figure out a new metric for positive or negative ROE2, or is the old adage “I don’t care what they say about me, as long as they spell my name right” still true?

In a situation like that one, I can imagine the panic in the Chic-fil-A marketing meetings. Social media mentions were through the roof, but is trending on Twitter always great for business?

It’s a tricky affair. What did the late S. Truett Cathy learn during that wild experience?

“I think that’s a political debate that’s going to rage on,” the former Chic-fil-A CEO told the Journal-Sentinel. “And the wiser thing for us to do is to stay focused on customer service.”

“Maneuvering the market is like driving a curling New England road in the evening mist: No matter how carefully you drive, moths will be hit, and contrition won’t matter,” wrote Jennifer Graham in the Boston Globe.

In ROI, do we count the dead moths along with the miles driven? What role does engagement have in our overall returns, and how do we tally the cost? It’s a fascinating question, and worth a discussion at your own marketing table.