http://checkthis.com/socialmedia This is the executive summary of the thesis I wrote to be graduated from Solvay Brussels School of Economics and Management. If you want to get the full pdf, contact me by email (sg@live.be)

1. To
contact
me
:
sg@live.be
http://www.twitter.com/stevegoudsmit
http://www.linkedin.com/pub/steve-­‐goudsmit/37/760/ba3
Executive
summary
Social
media
is
a
trendy
and
global
subject,
which
gives
390
million
results
on
Google
search
engine.
In
Belgium,
82
%
of
the
online
population
is
connected
to
social
networks.
For
this
reason,
more
and
more
brands
decide
to
invest
in
this
new
channel
but
majority
of
those
brands
do
not
measure
the
return
of
investment
(ROI)
of
social
media.
Impression
emerged
that
many
companies
are
investing
in
social
media
to
mimic
other
companies,
to
be
modern
and
because
it
looks
like
a
“free
lunch”
but
do
not
have
a
real
strategy.
This
feeling
has
given
a
definite
question
for
this
thesis:
“is
social
media
a
profitable
channel
for
FMCG
brands?”
This
thesis
tries
also
to
countered
common
erroneous
beliefs
such
as
the
concept
that
social
media
is
free,
that
“built
and
they
will
come
strategy”
is
always
successful,
that
social
media
can
only
be
measured
by
qualitative
metrics
because
much
is
intangible.
Based
on
researches,
main
reasons
for
unsuccessful
social
medias
can
be
emphasized:
lack
of
knowledgeable
staff
and
of
budget,
management
resistance
and
technical
complexity,
not
relevant
to
the
market,
issue
of
immediacy,
complexity
of
integration
in
the
marketing
mix
and
consistence
in
the
different
channels
used.
Increase
sales,
create
shareable
content,
mimetism,
skip
expensive
traditional
media
and
create
more
competition
in
the
advertising
space
in
order
to
improve

2. purchasing
conditions
of
traditional
media,
improve
after-­‐sales
department,
enhance
brand
awareness,
modify
brand
perception,
personalize
the
brand
are
the
main
reasons
to
invest
in
social
medias.
It
seemed
essential
to
separate
the
social
media
landscape
in
three
different
components.
The
first
is
the
paid
media,
that
requires
paying
advertising
space.
Then
there
is
the
owned
media,
which
represents
all
the
assets
the
brands
possess
such
as
their
Facebook/Twitter/YouTube
page
and
finally
the
earned
media,
which
refers
to
“brand-­‐related
consumer
actions
and
conversations”.
This
thesis
focus
on
owned
media
because
earned
media
is
not
led
by
companies
as
it
is
initiated
by
consumers.
Nevertheless,
consumers-­‐generated
has
been
considered
for
the
listening
part,
as
it
is
the
starting
point
to
build
an
owned
media
campaign.
To
determine
the
listening
value
for
FMCG
brands
in
social
medias,
a
sample
of
twenty
different
brands
have
been
selected
at
a
representative
cluster
of
local
and
regional
brands,
which
are
active
in
Belgium
and
in
maximum
two
other
neighboring
countries.
No
global
brands
have
been
chosen
to
avoid
creating
too
much
noise
and
because
patterns
and
preferences
are
different
among
various
cultures.
Then,
a
sampling
method
has
been
selected,
using
socialmention.com
(to
analyze
social
media)
and
google.com/blogsearch
(to
analyze
blogs).
Many
limitations
were
however
faced,
such
as
the
low
quality
of
the
chosen
platforms,
software
issues
to
recognize
sarcasm,
slang,
comparisons’
issues
and
the
equivocal
use
of
names.
This
analysis
has
demonstrated
that
only
10%
of
the
total
sample
expressed
opinion
related
to
the
brand
while
only
7
comments
out
of
640
could
help
brands.
For
the
majority
of
those
brands,
not
enough
information
was
available
to
get
a
directional
or
a
representative
idea
that
brands
could
use
to
better
understand
feelings
toward
the
brand.
This
seems
to
be
linked
to
FMCG
market
(low
involvement)
for
which
consumers
do
not
spend
time
to
write
reviews.
Moreover,
it
seems
more
relevant
to
look
at
the
category
of
products
than
analyzing
brand
names.

3. It
has
been
concluded
that
online
listening
cannot
be
currently
considered
as
an
alternative
technique
and
brand
should
continue
to
listen
offline.
Online
listening
could
however
be
interesting,
as
it
has
permitted
to
highlight
two
potential
crises.
The
core
of
the
thesis
has
been
focused
on
the
ROI
of
owned
social
media
advertising
in
2011.
The
aim
was
to
provide
an
easy
and
clear
framework
that
can
be
applied
to
different
social
media
platforms.
It
is
obvious
that
it
is
not
the
only
measure
to
evaluate
impact
of
social
media
but
it
has
permitted
to
highlight
results
that
the
analyzed
brands
were
not
aware
of.
Engagement
and
brands’
personalization
concept
are
too
difficult
to
measure
and
have
been
excluded
from
the
analysis.
For
this
chapter,
a
sample
of
115
local
and
regional
brands
has
been
identified
but
only
84
of
them
have
been
studied,
as
the
others
have
been
considered
as
equivocal
(having
several
meaning
such
as
“Le
Chat”
&
“Sun”
soap,
“Zero”
chocolate).
The
analysis
of
this
ROI
is
based
on
the
respective
cost
per
contact
in
traditional
media
vs.
social
media.
Each
social
media
cost
per
mille
(CPM)
will
be
linked
to
a
traditional
media
that
mirrors
well
the
value
of
a
contact.
This
approach
gives
the
maximum
value
that
a
brand
could
spend
on
social
media
before
reaching
the
break-­‐even
point
vs.
traditional
media
expenditures.
This
notion
has
been
called
“maximum
equivalized
investment”.
YouTube
has
been
compared
to
television,
Twitter
and
Facebook
to
magazines.
It
seems
obvious
that
comparing
magazines
with
social
media
is
not
a
perfect
fit
as
there
are
a.o.
problems
related
to
the
quality
of
Twitter
posts
which
should
not
exceed
140
characters
while
magazines
ads
appear
on
one
page,
problems
linked
to
people
who
choose
to
follow
brand
social
media
news
while
magazine
ads
are
imposed
by
the
magazine’s
editors,
etc.
Nevertheless,
it
gives
the
most
reasonable
benchmark
to
start
the
analysis.
Furthermore,
for
Facebook
and
Twitter,
analysis
has
only
looked
at
web
pages
managed
by
brands
while
for
YouTube,
owned
videos
but
also
earned
videos
that
were
generated
by
consumers
have
been
considered,
to
determine
their
owned
social
media
share
of
voice.
Finally,
by
interviewing
the
brand
owners
and
comparing
value
(as
calculated)
with

4. costs
of
the
social
media
campaign
(as
communicated
by
the
interviewee),
it
has
been
possible
to
judge
the
ROI
of
their
owned
social
media
efforts.
Many
findings
can
be
extracted
from
the
analysis.
First,
not
every
FMCG
brand
is
active
on
a
social
media
platform:
25
%
are
active
on
Facebook,
5%
on
Twitter
and
20%
on
YouTube
and
the
bulk
of
those
brands
are
active
only
on
one
of
the
three
different
networks.
Then,
beer
brands
attract
more
people
on
Facebook
than
other
brands.
This
can
be
explained
by
the
notion
of
social
magnetism,
where
some
trademarks
appeal
more
to
people
as
they
want
to
be
associated
to
them
and
because
those
brands
reflect
an
image
of
coolness.
YouTube
videos
uploaded
seem
to
be
interesting
due
to
the
best
practice
campaigns
but
60
%
of
the
analyzed
videos
have
been
watched
less
than
100
times.
It
has
also
be
concluded
that
85
%
of
the
studied
brands
should
spend
less
than
1000
€
on
YouTube
before
reaching
the
break-­‐even
point
vs.
traditional
media.
For
Facebook,
80%
of
the
brands
should
spend
less
than
5000
€
to
reach
this
break-­‐even.
Moreover,
interviewed
brands
claimed
having
spent
between
40.000
€
and
60.000
€
in
2011.
It
can
thus
be
concluded
that
Facebook
investments
could
have
been
more
significant
than
YouTube
investments
and
above
all,
that
owned
social
medias
were
not
profitable
for
FMCG
brands
in
Belgium.
Another
finding
is
linked
to
the
share
of
voice
of
the
three
different
social
medias
in
comparison
with
TV
traditional
media:
for
75
%
of
the
brand,
social
medias
represent
1
%
of
the
total
traditional
and
social
media
views
while
for
the
remaining
25
%,
the
share
of
voice
is
lower
than
5
%.
Earned
media
seems
to
be
the
consequence
of
a
good
paid
and
owned
media
strategy.
Indeed,
focusing
on
owned
media
increase
brand
awareness,
motivate
people
to
speak
up
and
can
be
the
stimulus
that
lead
to
the
next
social
media
campaign.

5. To
conclude,
owned
social
media
has
a
lot
of
potential
but
still
a
long
way
to
go
before
it
becomes
a
profitable
tool
for
the
local
and
regional
FMCG
brands
in
Belgium.