Hospitality eBusiness Strategies (HeBS) has highlighted that it is important to utilise a mix of both hard and soft metrics to measure performance and determine if changes in strategy should be made.

Published: 24 Jan 2011

Hospitality eBusiness Strategies (HeBS) has highlighted that it is important to utilise a mix of both hard and soft metrics to measure performance and determine if changes in strategy should be made.

In its study, HeBS Best Practices: 2011 Social Media Resolutions, the company has mentioned:

• According to Mzinga & Babson, 84% of marketers surveyed do not measure RoI for social media.

• According to eMarketer, there are three main reasons why marketers fail to track return on investment for social media: tracking RoI is difficult, there are too many potential metrics to choose from, and marketers don’t start with clear objectives.

Measurements and metrics should be organised based on exposure, engagement, and ROI/outcomes. Exposure refers to the number of users reached, engagement measures active interactions and purchase intentions, and ROI/outcomes can be numerically measured through financial benchmarks.

Hard Metrics

Hard metrics can include the impact on offline and online sales, market share, and leads generated. Monitoring these measures leads to a numerical gauge for the direct impact on revenue. Hard metrics can be measured by offering a print out coupon to fans and followers, which can be tracked after purchase. It’s recommended that marketers create a dashboard with both soft and hard metrics to track progress.

Soft Metrics

Marketers who focus too heavily on financial returns disregard the non-financial benefits of social media, which act as a precursor to revenue.

Qualitative effects of social media include:

• Relationship building

• Heightened brand awareness

• Increased visibility

• Sharing activity

It is important to consider how social media serves as a cost-cutter. It provides valuable insight on user preferences, attitudes, perceptions, feelings, and behaviors that otherwise would be included in fee-based research and development. Social networks provide a free medium to conduct polls and derive valuable consumer behavior insight.

Social media is also a valuable resource for CRM. Hotels can use their social media platforms to gain customer feedback and evoke two-way conversation.

Marketers can measure value based on soft metrics. The Social Influence Marketing Score (SIM) measures the share of online consumer discussions about a particular brand and their sentiment (how much users like or dislike the brand when discussing). Tracking these measures will help determine which types of social engagement bring in new customers, which leads to added revenue. Marketers can also play around with different metrics to calculate lifetime value.

Social Media enhances SEO. Search engines, like Google, process in real-time, meaning that social media posts appear in relevant search. For example, a HeBS client showed up second on the first page of search results for the competitive keyword, “Boston Hotel” because of the keyword mention within a tweet.

Effective social media helps drive traffic to your website. Featuring links to your website on your information tab or within posts directs traffic back to your website so that users can pursue more information and book. Including tracking codes within links to your website allows you to track traffic generated from your social media sites so that you can more effectively market to your fans and followers.

(This article has been contributed by HeBS social media specialists Senior Account Executive Margaret Mastrogiacomo and Account Executive Allison Sena. It is a part of HeBS Best Practices: 2011 Social Media Resolutions).

Industry’s perspective

In an recent interview with EyeforTravel’s Ritesh Gupta, Barbara Pezzi, Director Analytics & Search Optimization, Fairmont Raffles Hotels International, says the first step should always be to establish your business goals, before you even look at a dashboard.

“You cannot start measuring, if you do not know what is it that you are trying to accomplish. Once you have set out your business goals and strategy, you can select the relevant key performance indicators (KPIs) which will then be tracked to measure success,” said Pezzi, who is scheduled to speak at the forthcoming Social Media Strategies for Travel USA 2011 conference, to be held in San Francisco next year (March 2-3, 2011).

On measuring ROI, Pezzi said, “The first step should always be to establish your business goals first, before you even look at a dashboard. You cannot start measuring, if you do not know what is it that you are trying to accomplish. Once you have set out your business goals and strategy, you can select the relevant key performance indicators (KPIs) which will then be tracked to measure success. This also does not necessarily mean that it is only about revenue and that for example your Twitter main KPI should be to generate x amount in sales every month. One should take into account the revenue opportunities as well as the potential savings. For example, a KPI could be to generate a certain amount of quality media mentions which would equate in certain amount of PR value, or to achieve x amount of links with brand related anchor text, which again could easily be monetized in terms of SEO savings. The KPI selection might require some creative thinking, but I personally believe this is an essential part of the planning process each company should go through before they even create their Twitter/Facebook page.”

On measuring the success of social media efforts, she said one should not only look at the number of followers or fans.

“The metrics and KPIs will be related to the chosen business goals. There are some “standard” metrics like conversion rate or number of retweets by 100/1000 followers, but in most cases each organization will need its own unique list of metrics. The goal is not measuring for the sake of measuring or reporting, but to gain actionable insights to help you achieve your business goals. There are 3 main types of metrics: Revenue/Business Development (sales, average order value, request for proposals, etc), Cost Savings (recruitment savings, online media mentions vs. PR agency fees, online customer support vs. call centre fees, etc..) and then a set of typically qualitative metrics, be it share of voice, brand awareness, NPS (Net Promoter Score) and so on, which should ideally be benchmarked before you start your social media efforts, for pre/post comparisons. The latter group is very relative. If you cannot measure your NPS, focus on what you can measure and makes sense to you, based on the tool and resources you have available,” Pezzi said.