Tutorials > Social Business KPIs
How to Measure Your Corporate Social Performance
You may find many ready-made social Key Performance Indicators (KPIs) online but none of them will fit your specific business goals. Every business is unique. This tutorial helps you choose very relevant metrics, and goals of your social business and define your own Social Business KPIs.
Setting KPIs is a serious business. They tell the team what is important (KPI can also stand for "keeping people informed"), and once you have KPIs, you are actually committing your people's time and effort that go towards collecting, and analysing various types of data, almost on a daily basis.
KPIs provide insights into your team performance. But you have to define what is performance or key performance, first! In a business environment, performance is directly or indirectly linked to profits. For instance, sales is a key business performance area, because it increases profits: in an ideal world, more sales means more profit.
Some of the performance indicators of a retail outlet could be: number of people visiting the store every day; value of purchases per customer; online sales, and so on. Thus, business KPIs give managers insights into the profit making performance of organizations.
Social Business Performance
If profit making is considered as a performance area of a business, then engagement is the performance area of a social business. Because engagement should happen first before any sort of collaboration or action can take place. Hence, a social business KPI should give managers insights into the 'engaging' performance of organizations.
Critical Stakeholder Groups
The first step in creating a social business KPI should start with this question: "Who do you want to engage with?" so that you get to measure with a focus or business goal in mind. Social business finds its business case, only when the business has to engage with external stakeholders like customers, regulators, and other social groups in a border-less environment, in order to create value: new product or service, enhance brand image, user generated content for marketing, online community support for products, and so on.
Depending on your business goal, you may have to engage with different external stakeholder groups. For instance, a company that wants to come up with a new product can hope to crowd source product ideas from customers, especially lead users. In this case, critical stakeholder groups for engagement are customers. But, if a business wants to achieve its environmental goals, it may have to engage with local community, rather than customers.
Hence, identify one or more critical stakeholder groups for your social engagement plans. Answer "engaging with who would help you achieve your business goal?"
The second step is to gather relevant social media/technology metrics, which are quantitative or qualitative business data/information units. In the example of a business KPI, "online sales" is a performance metric. Having zeroed in on the types of people - critical stakeholder groups - you want to engage with to co-create a particular business, social or environmental value, you now choose relevant social media metrics based on content, conversation, channel, and conversion to be associated with the performance of engagement with relevant stakeholder groups.
Here is a sample list of social media metrics:
Content: Blog posts, video posts, tweets, FB wall posts...
Conversation: Retweets, comments, page views, shares...
Channel: Facebook, Twitter, Pinterest, Google Plus...
Conversion: Leads, redirects, submissions...
Using these social media metrics, you can make any number of permutations and combinations of key performance indicators for your social investment or social business. The important thing is all those metrics should be anchored around key stakeholder groups.
A food company that ran a crowd sourcing project to find interesting recipe ideas went by some of the following metrics: number of idea submitted by young women on Facebook, number of likes from existing customers, number of shares by non-customers, and number of comments to blog posts by men.
Engagement is the purpose of any social business initiative: social media marketing, social CRM, social product development, and what not. However, as explained, we need to apply our thoughts and answer engagement with who? where? how? and why?
Almost all KPI experts agree that each team or department or even organization should have not more than 10 KPIs - better, just 5 KPIs: too many KPIs will play spoilsport. You can create a database linked spread sheet to have your team populate relevant data, and generate reports with pie charts, bars, and tables.
Blog: Are You Working with Stupid KPIs by Mark A Smith
Youtube: How to Develop Key Performance Indicators by Erica Olsen, VP, Marketing, MyStrategicPlan.com
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