May 1, 2012, 12:00 AM

The Numbers Are In

Online consumers can be a brand's best advocates, and there are now metrics for gauging social success.

Lead Photo

Social marketing is no longer a novelty. It's a significant part of any retailer's marketing strategy, and top executives will demand the kind of documented results that they expect from other marketing efforts. One important aspect of social marketing to measure is how well a company does in creating consumer advocates who will share their enthusiasm about a brand with friends across social networks, e-mails and other online channels.

Social referrals can turn into significant revenue because consumers are sharing so much online these days. That includes updates, conversations, recommendations, photos, tweets, posts, shares, or +1s. Consumers share something 4 billion times each day on Facebook, 200 million times on Twitter, and 1 billion times on Google+. Research shows social networks reach 82% of the world's online population and represent 1.2 billion users worldwide. What's more, one in five minutes spent online is spent social networking.

Consumers trust what they're hearing from peers online. Ninety-two percent of consumers trust recommendations from their friends and 70% trust opinions posted online, says market research firm The Nielsen Co.

What's more, this sharing impacts a retailer's ranking on search engine results pages, as the two major search engines, Google and Bing, now take into account social content and signals created by consumers, and even display personalized results. This creates an enormous opportunity for brands to harness the power of their customer advocates and turn them into an effective social marketing channel.

Friend to friend

The Internet makes possible consumer-to-consumer dialogues on an unprecedented scale. These conversations make it possible for brands to identify engaged, loyal advocates and turn them into social advocates who refer the brands and the products or services they sell to their friends. Social referral programs offer incentives to social advocates to communicate with their online friends, through updates, conversations, recommendations, photos, videos, tweets, posts, shares, or +1s.

The measures of an effective social referral program are participation, amplification, friend clicks, referral traffic, click-through rate and conversion rate. Retailers that can track and measure across these dimensions and channels can optimize their social programs for ongoing success.

Here are the metrics to track on every social referral program:

  • Number of Advocates: Program participation is measured by the number of consumers who share the brand's message in some way. The number of advocates will vary based on the size of a brand's existing customer base. Extole benchmarks show an average of 3,800 advocates per month per brand. The benchmark data is from about 40 companies that make up a representative sample of Extole's more than 200 customers. Each of the benchmarked companies had social media campaigns running for more than 45 weeks.
  • Shares per Advocate: Program amplification is measured by the number of times each advocate shares. We see an average of 3.49 shares per advocate, with more than 12 shares per advocate for the most successful programs.
  • Number of Social Shares: Program reach is measured by social shares. Social shares can come in the form of e-mail, tweets, Facebook posts, or sharing a personal URL or PURL, which links to a custom landing page that brands provide a consumer to share content with friends. (Custom clothier J. Hilburn Inc., for instance, provided customers PURLs like, that a friend could click to land on a page inviting her to join J. Hilburn's social referral program.) Our benchmarks show an average of 13,200 social shares per month per brand.
  • Number of Friend Clicks: Friend clicks reflect the volume of new referral traffic driven by a social referral program. Extole benchmarks show an average of 5,600 friend clicks per month per brand.
  • Clicks per Share: The number of friend clicks per social share. Extole benchmarks show an average of 0.42 friend clicks per share, that is, a 42% click-through rate, with nearly five clicks per share for top programs.
  • Number of Conversions: Conversions are the number of new friend sales, opt-ins or redemptions from social referrals. We see an average of 440 new conversions per month per brand.
  • Friend Conversion Rate: The number of sales per friend clicks. Extole benchmarks show an average friend conversion rate of 7.75%, and up to 36% for top programs.

Results by channel

Companies can maximize their results by making sharing easy, along with testing and optimizing messaging for each sharing channel. We encourage brands to provide channel-specific default messaging that advocates can customize to increase sharing and the effectiveness of the messages. For example, "@BrandX's new line is amazing! Use my link for $50 off your first purchase of $100+ #sharemyclothes." Following are best practices and results by channel.

  • E-mail is the most highly used sharing channel. An e-mail goes directly to a friend, so it does not produce the same amplification as social shares. But consumers open e-mails from advocates 21% of the time and the click-through rate is 80%, which translates to 0.17 clicks per share. E-mail drives the highest average conversion rate of all sharing channels (17%). When crafting default messages for e-mail sharing, create stories with a personal touch, telling the friend about the offer she will receive and what the advocate gets if the friend converts.
  • PURLs can be used to share with friends through e-mail, blogs, instant messages, and social networks, and can be one-to-one or one-to-many shares. PURLs are the second most used sharing option for advocates. On average, advocate sharing via PURL results in 0.35 clicks per share. PURL conversion rates average 2%.
  • Facebook posts are one-to-many shares and see an average of 1.24 clicks per share. Conversion rates average 1.2%. Default Facebook messages should sound like advocates are speaking directly to their friends and should explain why advocates are sharing the information.
  • Twitter posts produce the highest amplification, with 6.81 clicks per share. Twitter conversion rates average 0.3%. Default Twitter messages speak to the world at large and should be less personalized, quick and to the point. Use the @TwitterHandle and the name of the brand within the post to boost a brand's ranking on search engine results pages.
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