Try Return on Engagement instead
Dustin and Rob have an interesting conversation going on about measuring ROI in Social Media. I’m increasingly perplexed by this concept.
How do you measure “investment” in social media? A wordpress.com, blogger.com or ActiveRain blog costs exactly $0. Let’s say you get one deal per year by blogging. A facebook profile costs you exactly $0. Let’s say you convert one lead from your facebook network into a deal per year. Let’s see, anything divided by zero is… Infinity, I guess. That’s one hell of an ROI!
Okay, so there’s the time factor. Sure it takes time to write a blog or do the social networking thing. You can do this during unproductive times of the day. Nobody at the open house? Type. Waiting for a client to show up for a meeting. Type. Kids gone to bed and the spousal unit is watching a boring TV show? Type.
Consider the opportunity costs
Now, consider the opportunity costs of not sharing your expertise. If you don’t write about what you know, the only people who benefit from your knowledge are you and your current clients. Knowledge is a Realtor’s greatest asset and to not share it is to squander it. Basically, to not share your expertise widely is like holding your expertise in inventory, and everyone knows that holding inventory costs money.
I’m going to go out on a limb and say that the net cost of blogging is effectively zero dollars. Some will quibble with this, but remember to consider the opportunity costs of holding your knowledge closely.
How do you measure “return”?
Okay, now how do you measure “return”? Well, let’s consider the more conventional marketing avenues: Can you ever say for certain that you converted a lead into a client BECAUSE of the newspaper ad, or BECAUSE of the calendar, or BECAUSE of the church pot-luck dinner? Not likely. It was probably a combination of factors that helped you convert them. There is no silver bullet. So to which activity do you attribute the return?
I’m in the habit of saying that in order to be successful in any business, you need to be able to do a bunch of things well, not just one. So it is in real estate: You need to figure out which bunch of things you’re going to be good at, and ignore the others. If you hate cold-calling and you can get leads by blogging instead of cold-calling, why would you spend your time doing what you hate? It shouldn’t take a psychologist to tell you that you’ll get better results by doing what you love.
A squiggly line
Based on my personal experience, I’m also fond of saying that I can’t draw a straight line between my blogging efforts and any success I’ve had in business. But I can draw a squiggly line. 2007 was the most remarkable year of my career, and I attribute it in large part to social media. Did I get a new job just by blogging? Nope! I networked in real life. Did I get the freelancing and public speaking gigs just by blogging? Nope! I got papers published and spoke for free. Did I just blog my way into a photo shoot and get my picture taken for the cover of my professional society’s national magazine? Nope! I volunteered for committees, showed up for events, and followed through on commitments.
Could I have done all of the above without blogging? Maybe one, but definitely not all three.
We’re so convinced that we can measure everything! I think that in some ways, the social web renders certain bedrock business equations, like return on investment, null and void. If small is the new big and free is a business model, we certainly have a paradigm shift to deal with. Are you comfortable with ambiguity? Are you willing to try a less objective measure?
I offer a different equation
So I offer a different equation: Return on Engagement. Instead of thinking about return on investment, consider how you can engage your social media farm. The extent to which they’re engaged with you is the extent to which they’re likely to think of you when they need to move. And because referrals will come when there’s trust and engagement, even though you may NEVER convert someone in your social media farm into a client, they will be more likely to think of you to the extent you’ve engaged them through social media.
This concept won’t resonate with everyone, but I know many genius agents understand this intuitively.
