A blog about Oracle Social Life

Where's The (Social) ROI?

Guest Author

Today's blog was written by Greg Robinson. Since Greg manages presales for Oracle in North America, he's in a unique position to see what's happening on the ground in social media.  

Some of you are old enough to remember a memorable commercial that swept the land in the 1980’s where Clara Peller would go to non-Wendy’s restaurants and shout, “Where’s the Beef?” The same could be said about social ROI today. Just as Clara Peller famously questioned fast food hamburgers in 1984, prospective social customers are questioning “Where’s the ROI?” as they go about determining if they should take the plunge into the world of social media.

ROI = Increased Revenue, or Reducing Costs 

As a reminder, return on investment (ROI) is made up of three main categories: increasing revenue, reducing cost, and the result of doing either increases margin. This is where the dilemma starts for social media; however this challenge isn’t restricted to social media alone. After being in software for over 20 years, I have yet to meet a Chief Financial Officer (CFO) that would buy into the fact that software would help their company increase revenue when making a buying decision. This doesn’t mean that it didn’t actually increase revenue. I’m saying that beforehand, in the negotiation, it would be discounted - no matter how solid the business case. On the other side of the ROI equation, CFOs (typically) would discount increasing efficiency as a means to cut costs because unless they were cutting headcount, they didn’t feel they were actually cutting expenses. Of course those CFOs were negotiating, but they had firm ground to stand on. This leads me to the next dilemma for social media: there’s no previous benchmarks.

You Need Good Benchmarks  

The ROI challenge is exacerbated with social because many companies are not using social tools today. This is not like ERP (enterprise resource planning) or CRM (customer relationship management) tools. Many of the companies purchasing ERP and CRM are on their second or third foray into purchasing these systems. For example, Oracle replaced many systems that were not as full featured as the Oracle Ebusiness Suite or companies simply outgrew their ERP systems. The same happened for CRM with applications; companies that were using CRM applications could compare ROI by migrating from on premise applications such as Siebel to Oracle Sales Cloud. By comparison, social is still early in its evolution. How can you expect benefits if you’ve never used social media tools before? You may try to compare your business to someone else’s to project ROI, but unless they’re doing exactly what you’re doing with the same audience then ROI is suspect.

Unforeseen Benefits

Imagine being a sales person who is walking into a prospective customer and saying something like, “by using social listening, you’ll stay in touch with your customer’s desires. You’ll give your customers the proverbial “seat at the table” to provide guidance on the products you develop.” Now, imagine telling them that by listening to their customers and developing to their needs, they’d create one of the best selling products they ever made! Who would listen to this message? Well, that’s exactly what happened for one of Oracle Social's customers. This customer understood that the color pink was top of mind for their customers, and developed a pink product to accommodate them. Who would have predicted that? It’s a great story to talk about, but few businesses will achieve this type of success by making their product pink. Every situation is unique. Every product is unique. Every customer is unique. The benefits of social for one customer may not apply to another prospective customer. Certainly the possibilities are there for something like this to happen, but quantifying this and translating that into ROI is unrealistic. 

Where’s the ROI?

Where’s the ROI? We hear you Clara! All is not lost. For companies that are using a social media application, comparing current tools to next generation tools, such as Oracle’s Social Relationship Management (SRM) tool, is easier to justify. For example, Oracle’s listening technology is far superior to products using only Boolean or Natural Language Processing technology. The efficiency gains are measurable and proven. Revenue gains using new names collected from social marketing campaigns are also proven, especially when using tools such as Oracle Marketing Cloud in addition to Oracle SRM to drive relevant marketing campaigns to expanded audiences.
What if you’re not using any social tools today? First, work with social experts to understand what benefits you can expect to achieve and help you develop strategy. Oracle has plenty of experts that have years of experience in social media. As with any new technology that business adopts, there’s a certain amount of risk associated with it. However, this risk is minimized because all social products are in the cloud. Getting a one year subscription with Oracle’s SRM for example, you can minimize the risk and cost. Another benefit is that with relatively little training, you can start using it and benefitting almost immediately. Finally, as with any project, measure the results against the projected benefits and adjust accordingly. 


Social media is an important aspect of business to develop. Since most companies lack previous experience, ROI is challenging to project. Over time, business will start to evaluate efficiency gains and projected revenue based on previous experience with various social tools, but this is years away for about half of the companies we work with. The good news is the “I” in social ROI is small compared to most investments. Since social is in the cloud, you can take advantage of subscriptions that don’t lock you into long-term relationships with software suppliers. We can all agree that social isn’t going away. Social touches everything. It’s just a matter of when for your business.

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