A few years back, rock-star business author Gary Vaynerchuk @garyvee, gave a famous talk entitled, “What’s the ROI of Your Mother?”
Gary’s point was that asking about the ROI of social media was silly and pointless.
There are some things, like motherhood, that you just instinctively know have value. Not everything that has value can or even needs to be measured, Gary argued.
Another way of putting this: If your company couldn’t prove an ROI for social media, would you ignore doing social?
What’s the ROI of Advocate marketing?
Study after study shows that recommendations from customers, i.e., advocacy, is the #1 way people decide what to buy.
Yet, some marketers still ask: “What’s the ROI of Advocate marketing?”
I get it.
Marketers get asked the ROI question all the time by their managers, boards, and others.
Advocate Marketing is Measurable
The good news is that the ROI of Advocate marketing isn’t like the ROI of your mother.
We can actually measure the ROI. Here’s how:
Each piece of UGC created by Advocates (five-star reviews, glowing stories, videos, photos, etc.) has value. We can assign monetary value to this UGC.
Each time an Advocate shares and/or publishes this UGC — or shares content you provide Advocates — there’s more media value. An army of 1,000 Advocates can reach approximately 1 million people each time they share. We can assign monetary value to that reach.
Enable your Advocates to distribute your promotional offers and refer friends. We can track the in-bound traffic, leads, downloads, sign-ups, and sales you get from this out-bound sharing.
Calculating Advocacy ROI
Here’s the formula:
Media Value + Sales Value = Advocacy Value.
Advocacy Value - Advocacy Investment = Advocacy ROI
By the way, there are other things that should and can go into an Advocacy ROI model. Reach out and we’ll share more with you.