So why, given the compelling data on the business value of social media, are executives missing in action? Because they are anchored to damaging myths about social media that are holding them back. And here are six of them.

1. Social media is a fad.
2. Social media is for posting photos of what you ate for lunch.
3. Social media is for code monkeys.
4. Social media is for people under 25.
5. Social media is for marketing.
6. There’s no ROI on social media.

The eruption of social media seemed to happen so fast and was so visibly associated with teen geekery that an inaccurate but influential narrative took hold.

What springs to mind when someone mentions Facebook? Distraction, time-wasting, cyberbullying, Millennials? It’s rarely ‘global customer growth strategy’, ‘targeted advertising’ or ‘real-time customer support’. LinkedIn? Isn’t that the place where people post their CVs? Not really.

However, these myths are pervasive and have generated an anti-social mindset. Here are some of the truths behind them.

Myth #1: Social media is a fad

It’s hard to raise ‘social media’ at an executive event without at least a handful of people dismissing it as a wasteful fad. Of all the myths, this is probably the most strongly held. It is also wrong.

For example, LinkedIn, the professional social networking site, was founded in 2002. LinkedIn now has 260 million users in more than 200 countries and is available in 20 different languages for people to network, recruit, raise equity, market their companies or share expertise through various channels, including groups. And that’s just the start.

When people think of Facebook, they tend to think of the college kid Mark Zuckerberg. But Facebook is over a decade old. As for Zuckerberg, that ‘kid’ is now a 30-year old billionaire CEO leading 6000 employees of a listed company worth about $100 billion and earning about $3 billion per quarter. Facebook is a sophisticated business and one of the few to have built agility and strategy into the heart of the business through cloud, social and mobile computing, and predictive analysis.

YouTube? This video-sharing website started in 2005. (It was not the first social video-sharing site: Metacafe was established in 2003 and Vimeo followed in 2004.) More than a billion people visit each month, watching around six billion hours of video. When I first decided to post an education campaign to YouTube in 2008, I remember being told by an advertising agency that it would never work because YouTube was for entertainment, not information. Now the YouTube education channel has tens of millions of subscribers worldwide. YouTube EDU provides access to teachers, short lessons and full courses from the world’s leading universities.

A relative newcomer, the microblog Twitter has been around since 2006. Twitter now handles 500 million tweets and 1.6 billion search queries every day.

And as those in the know will tell you, there were many precursors to these giants dating back to the nineties (Friendster, for example) and earlier. What’s more, the platforms are continuing to grow and are becoming increasingly sophisticated in response to user demand. There are now literally hundreds of social media platforms, and more are springing up every day. This is contributing to a sense of overwhelm, especially among newcomers. You don’t need to know about most of them, though, and you certainly don’t need to use them all.

It is important, however, to be aware of the well-established platforms and what they do. These include:

• Twitter
• LinkedIn
• SlideShare
• Facebook
• Google Plus
• YouTube, Instagram and Pinterest.

As all these will contribute to your Professional Platform, we will examine them later in detail. Here we need only underline the point that social media is not a fad. It is here to stay and we all need to know how to use it.

Truth: Social media is at least 12 years old and is growing strongly.

Myth #2: Social media is about posting photos of what you ate for lunch

Take a quick look at Instagram or Facebook and it’s no surprise that people think social media is about posting photos of what you ate for lunch. The data certainly supports an obsession with taking and sharing photos and videos around the world.

There are literally hundreds of photo-sharing sites, such as Flickr, Zooomr, Picasa and Photobucket. The more popular video-sharing sites include Viddler, Vimeo, Dailymotion, Facebook, YouTube, Ustream, Blip.tv, Qik, Metacafe, Break and Veoh, although again the full list runs to the hundreds.

Social media platforms are also integrating video and photo sharing functionality. For example, last year Twitter introduced a mobile app called The Vine that allows users to create short videos of up to six seconds; Instagram offers fifteen seconds.

And we are creating a lot of them:

• Snapchat (which deletes photos once they are viewed) — 400 million/day
• Instagram — 50 million/day
• Facebook — 350 million/day
• YouTube — 100 hours of video uploaded every minute (you do the maths).

In 2013 ‘selfie’, used to describe a photo taken of yourself and posted on social media, was named word of the year by the Oxford Dictionary’s editors after the frequency of its usage increased by 17 000 per cent in a year.

So there’s no denying that posting photos is integral to social media. But I want to put it in context. Imagine you’ve been in a four-hour board meeting and you break for lunch. Someone brings in a tray of sandwiches and you turn to a colleague and say, ‘Oh, chicken sandwiches. I love them’.

This comment is totally within context, it’s appropriate and reveals something of your human self. Such revelations are vital for building strong, connected business relationships. But they are not what the four-hour meeting was about.

Photos in social media are, similarly, a record of a moment in time: I was here. This is what caught my attention. The difference is that the chicken sandwich remark instantly evaporates into the ether, never to be heard of again. Not so in social media, or at least the kind of social media we’ve been using to date, where everything we share is published and remains online for good. Even this, however, is now changing.

Snapchat, for example, is a photo messaging app that allows users to share photos, videos, text and drawings — but with a difference. First, content is shared with a controlled list and, second, you can set a time limit for how long they can be viewed (1–10 seconds). After that, content is hidden from the recipient’s device and deleted from Snapchat’s servers.

The exodus of teenagers from Facebook to Snapchat suggests that this privacy feature is highly valued. Facebook is being widely sued for breaching user privacy, and given an alternative, users are voting with their, er, fingers.

But the Snapchat migration only reinforces the message that users are not looking to leave the social media ecosystem, but simply to find better alternatives within it, of which there are likely to be many as social media continues to mature.

There are also enormous business benefits, in particular for visual brands, in using video- and photo-sharing social media, which I discuss later on. In the meantime, it’s good to put the chicken sandwich in context.

Truth: Social media captures human moments.

Myth #3: Social media is for code monkeys

Social media is not about technology and it’s not about the tools. It’s about what these tools allow you to do, and that’s the oldest thing in the world — building relationships.

Yes these platforms have to be built and yes people who know how to code build them. But you don’t need to know about that, any more than you had to learn to build electronic circuits in order to watch TV. (I will make a point later on the importance of ‘codeability’, rather than specific codes, in a digital world.)

Nonetheless, these ideas have become first confused, then linked, then mythologised so that ‘social media’ elicits images of bleary-eyed students in tracksuits doing all-night hacks … and all the other stereotypes relating to code monkeys.

Why bark if you have a dog? Sure, it’s an icky business idiom, but it makes the critical point that knowing how to do something is not as important as knowing how to do something about it. As far back as 2007 award-winning author and principal analyst at Altimeter Group, Brian Solis, wrote that social media was about sociology, not technology.

Technology is just that, technology. The tools will change. The networks will evolve. Mediums for distributing content will grow. Along with it, behavior will too continue to adapt. In the era of the attention crash and social network fatigue, it is absolutely critical that we step back to realize that we are the communication bridge between companies and people. However, we also must realize that in the era of social media, people also have amplified voices and are now a powerful channel of peer-to-peer influence — for better or for worse.

This nicely captures the importance, and unimportance, of social media tools. And as to creating relationships and connections, building trust and exchanging value — these are things executives know a lot about.

To stay relevant you need to:

• extend your existing connections into social networks, where your customers and suppliers, and your existing and future employees already are.
• reach out to people from all over the world who you do not yet know and activate the many latent and mutually beneficial relationships. The algorithms built into social media networks will help you to find them. That’s the only part that requires code. And you do not have to write it.

Truth: Social media is about relationships.

Myth #4: Social media is for people under 25

In many ways this is an extension of the previous myth, and it’s absolutely not borne out by the data. As we’ve already noted, eight new people come online every second. Are all these people 25 and under? Not even close.

With the exception of executives, people from all age groups are becoming more confident about global platforms and are flocking to them. For example, on LinkedIn, which is specifically for professionals, two new people join every second. On Twitter the fastest-growing demographic in 2013 was adults aged 55–65, with a jump of 70 per cent; for Facebook those aged 55–65 jumped 46 per cent in the same time frame, and Google Plus users increased around 57 per cent.

Doing social does not mean you have to start speaking ‘lol’ or ‘awesome’. Authenticity is encouraged and valued. That doesn’t mean you should say uncensored what you feel about all issues. Just as in real life, you take the measure of a situation and make judgement calls about when and how to respond, when to hold back, when to share and when to be more reticent. But the days of pre-scripted corporate speak that makes you sound more like a bot than the bots do are, thankfully, fading fast.

Truth: Social media is for everyone.

Myth #5: Social media is for marketing

Yes most marketers are using social media — some poorly, some well — but social media is about a lot more than marketing. With social media, the endgame is to socialise the business, creating connection through every layer of business structure and every level of the business cycle. That means social CEOs, social C-suites, social customer service, social sales, social research.

Because marketers were some of the first to see the potential of social media and because they are creative and experimental, many hopped in to try it out. Unfortunately this association of marketing with social media puts executives off, because many do not believe marketing demonstrates a rigorous return on investment (ROI).

A 2011 study of 600 CEOs showed 73 per cent thought marketing lacked business credibility and were tired of being asked for money without a forecasted business impact. In the past it has always been more difficult for marketing to measure direct and indirect impacts and ROI. (I will get to that in more detail in a moment. Here I’ll simply say that is not as big a problem these days.) Yet, not surprisingly, very few companies are willing to give up their marketing activities. The value may not be as easy to measure as a direct transaction, but executives do understand this value.

The problem is that many leaders continue to think about social media as a channel, specifically for communications or sales. But its reach is far greater. What social media, like technology, delivers is an expectation that cannot necessarily be delivered under legacy business structures — immediacy.

This can in part be addressed at the channel level. For example, many social media users shop by smartphone, and businesses that have successfully adapted to mobile can generate sales by suggesting additional options at the point of sale. (Not surprisingly, those customers want issues resolved just as fast, and in an online space that suits them.) But there’s increasing evidence that this is not enough and that it’s the companies that ‘get’ digital as a ‘way of being’ rather than a ‘handball-to-marketing’ that outperform their peers.

Several studies show that the real business benefits of digital emerge as a result of this deep structural transformation and not fashion-driven tinkering at the edges. A view that social media is marketing is first generation thinking; we are beyond that now, using social to drive transformation across the business.

Truth: Social media is about immediacy and connectivity, and impacts the whole of business.

Myth #6: There’s no ROI on social media

The Harvard Business Review finds one of the toughest challenges for executives is tying social investments to the bottom line and linking social media efforts to ROI.

Metrics are becoming more sophisticated, however. There are increasingly cloud-based data analytics engines that can merge all sources of data across all channels to deliver credible ROI reports. Many social media metrics companies offer products that allow businesses to enter consumers’ social media ecosystem and to track with absolute precision what they click, where they land, how much time they spend there and whether that activity translates into a sale. Even if a user does not purchase something at that time, if they later return to do so, that can be tracked. Ironically, this newfound ability to account for every click of the customer journey is backfiring as consumers become more concerned about privacy and are acting to protect their online activities by using anonymous search functions such as DuckDuckGo.

Meanwhile the question remains: is there any way to calculate the return on investment (ROI) of social media versus other channels?

While there are numerous metrics that make that promise, the short and disappointing answer is not easily, or at least not definitively. The difficulty of distinguishing the buying context — such as via ecommerce advertising or social media recommendations — means there is not yet a conclusive measure for the contribution of social engagement overall. However, there are some effective ways to make an evaluation.

The most advanced tools capture the non-financial value of lead indicators, such as online relationships. Since word-of-mouth recommendations are one of the cheapest and most effective forms of marketing, getting some background on how online relationships influence the purchasing decisions of consumers is a useful exercise for business leaders.

In this case, the return on investment of social media could be measured by the cost saving from trying to obtain the same data by other means, such as through focus groups, which are expensive, or surveys, which can be unreliable.

For example, a recent report by Forrester Research argues that an effective social media marketing scorecard considers metrics from four different perspectives:

1. Financial: Has revenue or profit increased, or have costs decreased?
2. Brand: Have consumer attitudes about the brand improved?
3. Risk management: Is the organisation better prepared to note and respond to attacks or problems that affect reputation?
4. Digital: Has the company enhanced its digital assets?

Forrester quotes computer company Dell Outlet’s Twitter account as having ‘generated millions for Dell’. Dell claims it generates sales from its Twitter accounts by ‘posting offers and responding to questions’, although the details are sketchy. Dell’s in-house marketing manager, Stephanie Nelson, wrote that the company had earned $2 million in two years (2007–2009) when people followed links from Twitter to the Dell Outlet site. She says it also created interest in new products, although there is no measure of the return from this interest in the form of sales.

Using a different measure, computer chip maker Intel says its blog for partners Channel Voice has decreased costs by eliminating the need for expensive in-person events.

Procter & Gamble used media mix modelling, which analyses sales data to determine the effectiveness of the marketing mix, to demonstrate that the community of teenage girl–oriented advice site Beinggirl.com is several times more effective at driving sales of its feminine hygiene products than its television ads.

These results underscore the value of social relationships as indicators of future sales, even though the exact engagement-to-sale trajectory is not mapped.

The dilemma for leaders is that these social relationships are powerful, whether or not their company chooses to participate in them. From the start of the internet, people began sharing shopping experiences and recommending or criticising brands just as they would in conversation.

The worldwide decline in trust towards institutions meant people stopped believing what companies had to say about themselves some decades ago. Instead, the rise of peer-to-peer trust (which is still growing) meant recommendations from friends started having a broader reach than in the past.

A 2011 IBM study shows consumers creating as much information every two days as they did in the period from the dawn of civilisation to 2003. Those recommendations were being made in social networks where corporates were noticeably absent — at least initially.

A simple search will provide companies with detailed consumer sentiment and trend data that allows them to track what keywords are used to find products and which of those lead to sales. Strategies can be refined accordingly.

Data mining is another option: it allows businesses to compare comments on products by different providers and aggregate these with ratings and reviews to better understand what customers want and how their competitors are faring.

Location-based data also allows businesses to pinpoint where conversations about their products are happening and to identify potential new markets; growth in these areas would provide further financial measures.

Another powerful tool is data-driven web optimisation, which allows data to be tested, analysed and measured. For example, market research company eMarketer improved its subscription conversion rate by 53 per cent by removing the price from the description after reviewing data that showed reader preferences. It is possible to measure what it costs to get this benefit against achieving the same results by conventional means.

Online feedback on products also allows companies to quickly refine their offering or approach. Leading Company reports how one financial services company increased lead generation by 40 per cent through better design and by delivering content that focused on the benefits of the product while reducing non-essential information as a result of information it had received directly by engaging customers across multiple platforms.

In all these examples acquiring data by other techniques, including using large teams to cold-call clients, can be expensive. The cost saving could be used as part of the ROI measure of the project.

As far as campaigns are concerned it’s possible to track the journey of a customer from click to click, although this tells us more about the influence of a specific campaign than about the factors that influenced the lead-up to a decision.

However, we do know that engaged communities lead to sales down the line. American health and nutrition retail company GNC is an example of a store that built online communities interested in health and provided experts to answer questions at no cost, and without directly chasing sales. This initiative created a ‘halo effect’ of positive sentiment that ultimately helped anchor people to the brand and converted to sales over time.

Because B2B is immersed in the same social and mobile ecosystem as customers, suppliers and competitors, the need to create positive impressions online is just as critical, perhaps more so, since 60 per cent of the buying circle is over before a prospect makes contact.

Research shows top social adopters like IBM, DELL, Intel and Microsoft ‘get’ digital as a business tool and use it effectively, not because they are IT companies either.

B2B companies have much to gain by providing value to prospects and they can do this by generating useful content such as ebooks. Creating offers that prospects can act on is an effective way to generate leads that can be measured. And while existing B2Bs have made a slower transition into the social space than consumer brands, given the rise in participation globally their involvement is inevitable.

Peer-to-peer conversations influence behavior, and in an environment in which these relationships are more trusted than anything else, businesses must take notice of them, even in the absence of a perfect measure of ROI for all aspects of social media.

But ROI is far broader than all of the above. How, for example, do we measure the value of a relationship?

Having said all this, in 2013 Business Insider reported that many brands were moving away from metrics that purported to measure social media ROI because they recognised that social media was not a transactional action and that indicators, for example on financial returns, showed secondary effects. The trend is not universal, however, as many social commerce applications and direct response campaigns are able to show measurable effects using social media networks.

BI reported that between 2010 and 2013 the proportion of marketers using a revenue-per-customer metric on social media fell from 17 to 9 per cent, according to the February 2013 CMO survey. The percentage tracking conversion rates also dropped, from 25 to 21 per cent.

The focus has shifted to measures that reflect audience building, brand awareness and customer relations through metrics such as reach, engagement and sentiment, all subjects of this book.

The General Manager from Kinship Digital, Walter Adamson, says the discussion on social media ROI should be qualified to external social media networks because enterprise social networks across businesses yield significant ROI when done properly. However, Gartner is well quoted as saying that 80 per cent of enterprise social networks fail to meet their objectives during implementation, often because of poor analysis or strategy.

Truth: ROI is complex to measure, but social and digital deliver measurable value.

Chapter summary

Here are six truths about social media.

1. Social media is at least 12 years old and growing strongly.
2. Social media captures human moments.
3. Social media is about relationships.
4. Social media is for everyone.
5. Social media is about immediacy and connectivity, and impacts the whole of business.
6. ROI is complex to measure, but social and digital deliver measurable value. There are many, however, who believe you need to be in social to understand it. I am one of them.