© 2008 Powered, Inc.

Social Marketing: This ROI is Too Good to be True!March 25th, 2009

© 2008 Powered, Inc.

2

Today’s Topics

Results of the 2008 ROI Benchmark Study for Social Marketing ProgramsBill Harvey, President, TRA Global

Social Media: Why it Makes Sense and How I Prove it to MyselfBrian Halligan, Co-Founder and CEO, HubSpot

Branded Online Community MeasurementKathy Warren, VP Account Planning, Powered

© 2008 Powered, Inc.

3

Branded Online Community MeasurementKathy Warren, VP Account Planning, Powered

© 2008 Powered, Inc.

4

Social movement creating opportunity across the Enterprise including high-potential for marketing

Marketing

Sales/Dist

• eComm Ratings, Reviews

PR & Corp Com

• Voice of brand

• Blogger outreach

Support

• Support Forums

Planned as part of go-to-market strategy

Designed to drive:• Acquisition• Purchase consideration• Loyalty• Advocacy• Insight

Long-term persistent strategy

• Social Marketing• Segment-focused

communities

© 2008 Powered, Inc.

5

Three keys to branded online community success (and ability to measure)

1. Start with the audience segment & desired outcomes in mind, not ‘the message’ – it’s all about them

2. Give before you get - engage based on mutual INTERESTS first

– Category second

– Brand/products (not just the latter)

3. Listen and show that you heard

X

© 2008 Powered, Inc.

6

Segment value drives critical mass & substantiates expansion

time

Con

trib

utio

n

High

Low

Pro Content UGC Research

brand community

© 2008 Powered, Inc.

7

Evolution from tactical to strategic planning

ReportingBusiness Outcomes & Actionable Insight

© 2008 Powered, Inc.

8

Social Marketing Transactional & Strategic ROI

Total Visits

50% Engage(in content & conversations)

Relationships Purchase influence eCommerce handoffs

Brand Equity Segment insights

• 4-7% of visitors register

• 25% return visitors

18-20% reported purchases (all channels)

5% of visitors click-through to online store via merchandise

• 74% more likely to purchase

• 86% willingness to recommend

6-12% ongoing survey response rates

Online Transactions

Brand.com E-mail marketing Paid Media Viral/WOM

*Source: Averages across Powered communities CY2008

© 2008 Powered, Inc.

9

Cumulative ROI of Social Marketing

6-month pilot Year 1 Year 2 Year 3

Total Visits 225,000 900,000 1,080,000 1,440,000

Engaged Consumers

112,500 450,000 540,000 720,000

Registered Members

(4% cumulative)9,000 45,000 88,200 145,800

CTR to brand 11,250 45,000 54,000 72,000

Transactions*(assumes 1%)

2,250 9,000 10,800 14,400

Advocatesmore likely to recommend

96,750 387,000 464,400 619,200

Branded communities are persistent and drive ongoing return.

Based on typical results from Powered programs – results will vary by brand , benchmarks are established during 6-mo pilot.

*Online transactions are dependent on client tracking via web analytics. All other measures are tracked by Powered.

© 2008 Powered, Inc.

10

Managing to actionable KPIs – through behavioral & primary research data

Objective Metric

Acquisition Visits

Unique Visitors

New vs. Returning Visitors

Bounce Rate

Registered Users

Marketing Opt-ins

Group Members

Engagement Average Session Length

Total page views

Page views/session

Total Engaged Visitors

Content Engagement (Enrollments, Views)

Social Engagement - Creators

Social Engagement - Critics

Social Engagement - Contributors

Social Engagement - Spectators

Objective Metric

Purchase Consideration Clicks on Merchandise or CTAs

Additional hand offs to brand

Likelihood to purchase brand

Planned purchases in next 6 months

Reported purchases

Estimated Revenue/course

Brand Equity Program satisfaction

Likelihood to recommend brand

% of users who refer-a-friend

Retention % returning unique visitors

% repeat sessions

% of audience retained y:y

Survey respondents by year registered

Operational Efficiency Service call avoidance

© 2008 Powered, Inc.

11

Results of the 2008 ROI Benchmark Study for Social Marketing ProgramsBill Harvey, President TRA Global

© 2008 Powered, Inc.

12

About This Study

Purpose of This Study– Equip the marketing community with the best information from which to

create the most effective marketing programs in the immediate future.

Study Methodology– Self-reported consumer data collected via surveys– Surveys were collected approximately 6-8 weeks into experience– Midpoint values were used in analyzing responses regarding amount

spent on purchases of relevant products

Sample Size = 112,183 completed surveys

© 2008 Powered, Inc.

13

2008 ROI Results

The results would indicate that the longer the program is sustained, the

higher the ROI achieved.

For 2008, Powered social marketing programs yielded a 60:1 ROI, a

10% increase from 2006.

© 2008 Powered, Inc.

14

2008 ROI Comparison by Marketing Program

The Powered approach for social marketing programs has consistently outperformed the DMA and MMA ROI estimates for all of direct marketing

and non-CPG mass media advertising for the past 3 years NCM has conducted this study.

Direct Marketing Association (DMA) 2005 Economic Impact Study, Peter A. Johnson, PH.D., pjohnson@the-dma.org.MMA: “Finding The Other Half” by Erwin Ephron and Gerry Pollak, Ephron On Media website archive.

© 2008 Powered, Inc.

15

2008 Supplementary Findings

Objective Metric

Acquisition 12M visits across Powered’s online community sites

7.5M unique visitors across Powered’s online community sites

7:1 ratio of new to returning unique visitors

1.4 million registered users

ContentEngagement

94% satisfaction rate with overall content

93% satisfaction rate with educational content

92% rated content as excellent, very good or good

Objective Metric

Purchase Consideration Nearly 500,000 clicks on product CTAs

66% are more likely to purchase brand

27% plan to purchase in next 12 mos

26% reported making a purchase

Brand Equity 85% would recommend brand

92% of users would refer-a-friend

Retention 95% would visit the site again

© 2008 Powered, Inc.

16

Implications for Marketers

Give in order to get

Utilize a “soft sell” approach to marketing communications – inform, educate and help consumers

Provide the social marketing and Web experiences your

customers value

Shift thinking away from short-term social media campaigns to long-term social marketing programs

Social Media: Why It Makes Sense & How I Prove It To Myself

Twitter.com/bhalligan

Page 18Slide 18 of

Page 19Page 19

Page 20

Social Media Visitors

Slide 21 of

Social Media Visitor AnalysisVisitors

Prospects

Leads

Opps

Cust

Page 22

Social Media “Reach”

Page 22

Page 23

Thank you………..twitter.com/bhalligan

Page 23

© 2008 Powered, Inc.

24

Questions?

Bill Harvey, President, TRA Global bill@traglobal.com www.traglobal.com

Brian Halligan, Co-Founder and CEO, HubSpot twitter.com/bhalligan www.hubspot.com

Kathy Warren, VP Account Planning, Powered twitter.com/kathywarren Facebook: Kathy Warren E-mail: kathy.warren@powered.com Blog: http://theengagedconsumer.powered.com/