What does Return on Social Effort (ROSE) online mean? It is a new performance measure (we just coined it!) used to evaluate the effectiveness and efficiency of an online social effort based on achieving desired results over a specified time period. The idea is to monitor and measure the profitability of that effort, so there’s really no right or wrong way of calculating it. What’s crucial is to first determine what you want to get out of your social media effort before analyzing or measuring it. The reason for this exercise is to justify your company’s social media marketing or listening (after all, it all starts with listening!) program.
It’s similar to measuring cost-per-conversion in that you meter the amount of products or services you sell as a result of your social media efforts. For a look at social media monitoring tools in great depth, go here (http://wiki.kenburbary.com/).
To calculate the ROSE, the benefit (return) of your effort is divided by the amount of time it took you to achieve a certain outcome. It would look like this:
Gain from Effort - Cost of your Time
Cost of your Time (multiplied by 100)
For example, say every day for one hour at 8 a.m. and 9 p.m. you Twitter, share something provocative on LinkedIn and offer the latest trend piece in your industry on Facebook. Let’s estimate the worth of your time at $250/hour (gross). At the end of a five-day week, your investment of time is $2,500.
When you examine what you achieved on behalf of your firm, you discover that your effort attracted new customers and generated new business worth $2,500 (gross). You broke even for the week! Or, you landed an international media opportunity that put you front and center in The New York Times or The Wall Street Journal. It’s hard to put a price tag on that sort of opportunity, but we could place it at $25,000. So, the ROSE would be:
$25,000 (media placement) - $2,500.00
$2,500.00 multiplied by 100
ROSE = 900%
Say after two weeks, someone on LinkedIn reaches out to you, takes a job at your firm and generates a quarter of a million dollars in new revenue. Total sales jumped 27% for the three months they were on board. The ROSE may look something like this:
$250,000 (new business) - $5,000.00 (your time) - $40,000 (new person's salary)
$45,000.00 multiplied by 100
ROSE = 456%
There is always the possibility that you go for two straight weeks without any noticeable ROSE. Then what? Does it mean you call it quits on social media and networking? When you consider the scenarios above, the likelihood of not achieving results on something at some point is fairly remote. Buzz, both online and offline, is worth something. It usually translates to sales.
The trick to calculating your ROSE is to know what you are measuring, why, for how long and whether you can achieve the desired outcome.
Increasing your ROSE
Now that you’ve mastered the basics of calculating your ROSE, you need to take steps to increase it. Here are six.
Try ROSE out for a couple of months – listen, monitor and track – and see what happens. Compare ROSE against your ROI with a salesperson. After six months, see who has generated a higher return. If comparable and affordable, keep them both! As you progress, monitor and modify performance based on your business needs.
Other than your time, you’ve got nothing to lose and everything to gain.
About the Author: Global business expert Laurel Delaney is the founder of GlobeTrade.com (a Global TradeSource, Ltd. company). She also is the creator of “Borderbuster,” an e-newsletter, and The Global Small Business Blog, all highly regarded for their global small business coverage. You can reach Delaney at firstname.lastname@example.org or follow her on Twitter @LaurelDelaney
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