Maybe I’m just not getting it, or I’m reading too much into vacuous statements, but why are we asking the ROI on a thing without considering what one is doing with that thing.

And define “investment” in this content? Time? Money? Something else?

Time may be money to some people, but not all, but money is never equal to time.

The vague “What’s the ROI” question is, I think, confusing the means of distribution with the content and the purpose. They are all interrelated but are not equal.

I’m generally in agreement with what I think McLuhan meant on “the medium being the message” but the use of “being” has always bugged me in this statement. It’s hyperbolic (in the non-mathematical sense). Let’s just say I concur that the means of delivery of any communication affects the reception of the content. This works for TV, and it works for Social Media.

So what’s the ROI on television?

First question that pops into my mind is from whose point of view? The broadcaster? The audience? The advertiser? The appliance store? The cable repair dude? Someone else? The ROI differs for all, based on their relationship to TV.

It is the same for Social Media. From whose point of view are you asking this question?

Asking clear questions is the obvious first step into getting clear & relevant answers. This is why we do research.

You can sensibly ask what is the ROI on your working hours spent promoting your business, or the ROI on the advertising dollars spent via Social Media, but an abstract “What’s the ROI” without specifying something tangible & measureable, is a pointless question. It’s a bit like asking “What is the ROI on eating?” Well, if you don’t you’ll die.

The use of social networks is a communicative process. The purpose differs for everyone. What I get for using LinkedIn or Facebook or Twitter or blogging may be quite different from others doing similar things. I do many things via social networking sites, and I communicate as well as by phone, by email, by snail mail, etc. Effective communications are a necessary precondition to doing work in our era.

I don’t measure ROI on this by channel (is this practical?) but rather the overall effectiveness of my communication strategy. My revenue stream is usually a good indication that if I spend a lot of time communicating for business and there is no associative income, the ROI is not good.

“What is my ROI on my communication strategy using social media?” is a sensible question, but not easily answered. Unless you are ONLY doing this and it works or doesn’t (using the revenue indicator) it is hard to measure the exact reach of the medium.

We of course try. That is the nature of being a market researcher. We can get you something of value, and you can use that to make decisions. It’s what we do.

I can’t guarantee you’ll get a mathematically precise measurement (like your ROI on all the time you spend on Facebook is worth $14,113.12 per annum), but I can guarantee that asking an imprecise and vague question will not get you any answer at all.

Cheers