So who’s making the money in social media measurement and monitoring? I was on a panel asked this question at the Measurement & Monitoring Meetup on Friday. It’s essentially another take on the ROI of social media monitoring question, but with the focus widened to include suppliers and consultants, and at first sight it’s a rather annoying question. Having established at the Chinwag event on Tuesday that social media isn’t (necessarily) all about financial ROI, to be asked where the money is in relation to social media monitoring tools seems regressive.
Yet it’s actually a burning issue for many of the suppliers. Having tried and tested many of the leading services over the last few months (Sysomos, Synthesio, Radian6, Brandwatch among others), I have a new-found respect for the task these guys have taken on. Not only are they sifting through millions of new conversations every day, they are having to linguistically analyse these conversations and then produce results according to often very complex individual algorithms entered by their customers. This isn’t rocket science, but it requires rocket fuel of a variety in it’s processing power. That costs money so they need to charge their users for their services, and most of them do.
But are they making money? Granted, there’s a gold-rush going on, with companies desperate to know and understand what’s being said about them online. But, with some exceptions, social media is not yet accepted wisdom in many boardrooms and budgets in no way match the enthusiasm of individuals in forward-thinking PR and marketing teams. Even the sponsors of highly successful campaigns (such as the Meerkat) have not seen the need to invest in social media monitoring tools.
We’re just not there yet in terms of credibility and investment. The market is too young, too fragmented and too volatile for anyone to be making a fortune out of monitoring yet. As I said in the final Panel session at the event on Friday, I think we need to see some clear market leaders emerging, with easily comparable pricing and feature lists, before customers will have the confidence to invest freely in this exciting new marketplace. And of course, the shadow of a free dinner around the corner (aka Google Social Analytics) is likely to cause some companies to delay their purchasing decisions.
I guess that leaves the Consultants. I’d love to say that in times of uncertainty, it’s the consultants who make all the money, but in truth it isn’t. Consultants are at the bottom of the food chain in this ecosystem. First the brands need to be making money, enough money to feel confident enough to invest in something new. Then the monitoring companies need to be making money, enough money to be a contender. Then, someone has to decide that this is quite a complex field and it might help to bring in a real expert. I can tell you, that doesn’t happen all that often!
On that note – Marshall Sponder and Nathan Gilliatt, two of the best social media monitoring consultants around, will be in the UK at the end of March 2010. Contact us if you’d like to book an appointment with either of them.