(source: TechCrunch.com)

TechCrunch has just released their 2009 estimated value of the most important social networks around the globe, based on the model they used in 2008 for the same purpose and based on the idea that “users in high-value online advertising markets like Japan, the UK and the U.S. were worth more (financially speaking) than those in lower value online advertising markets.” (source: TechCrunch.com)

Based on the current number of users, the current market valuations of various social networks as depicted by either financial transactions, financing or other means, as well as other factors, such as average advertising spending for each online user, TechCrunch has come up with a graph depicting the distribution of the shares of the social network market.

Based on their model, the top five social networks worldwide are Facebook, MySpace, Bebo, Twitter and LinkedIn, with estimated valuations of 10 bil USD for Facebook, 6.5 bil USD for MySpace, 1.8 bil USD for Bebo, almost 1.7 bil for Twitter and 768 mil USD for LinkedIn. One of the conclusions that can be drawn from this model is the following: “If Facebook is worth $10 billion (37% of the value points), the value of the entire social networking industry is $27.1 billion.” (source: TechCrunch.com)

Another conclusion that can be drawn from this is also that being number one does not mean a secured leadership and control position, because in this day and age, almost any challenger can jump up and become the new leader in an online industry segment (i.e. MySpace was no#1 last year, but this year Facebook stormed into the no#1 position, with Twitter and LinkedIn following strongly).

While still not fully tapped market, social networks have proven their financial value, but not really (or not yet) their underlying business models. It’s clear though that the future lies in communication and collaboration and social networks do play well in these categories. However, I think there is still no killer social networking application yet, at least nothing comparable to what the iPod & iTunes were for the online music industry.

Avinah Kashik - Social media is like teen sex... (source: http://zygote.egg-co.com)

Measuring the unmeasurable? Zygote, from Egg Co., thinks it is possible. However, he does admit that there are some issues with measuring Social Media and he’s not the only one saying it. Avinash Kaushik, Google Analytics Evangelist, said the following: “Social media is like teen sex. Everyone wants to do it. Nobody knows how. When it’s finally done there is surprise it’s not better.”

While ROI means that there is a return on the money you invested, some people argue that Social Media is more like ethics or CSR. Zygote identifies a lot of qualitative attributes generated by Social Media, such as loyalty, trust, passion, interaction and brand awareness. If we look at these attributes, some of them are also found in the lovemarks, since these are brands that you deeply love and respect.

If social media is full of such qualitative attributes, how can you set up quantitative metrics to actually calculate its ROI? Well, the first things you have to do is to try to eliminate the useless potential metrics, Zygote says. There are a lot of things that can be measured in terms of digital communication, but which of these measurements are really meaningful for your business? Well, if marketers might be talking about awareness, reach or other qualitative terms, your sales people might be more focused on leads, sales and other more quantitative things.

Defining success metrics also depends what are the goals of your marketing communication campaigns. Are you aiming to generate buzz about a new product? Do you want to make your existing customers trust your brand more and be more loyal to it? Do you want to attract new customers? Your social media metrics should be in perfect sync with your defined goal. If you want some examples of succesful social media campaigns, think about Burger King’s Sacrifice a Friend Facebook campaign.

Finally, Zygote warns that generating targetted traffic from social media sources is only half the challenge, especially if you are actually trying to sell something to your customers. Convincing visitors to pass through your door only covers the first steps of purchasing process phases. The most cost efficient marketing takes place inside the point of sale.

For more information about Social Media ROI, see Zygote’s presentation.

When: 09:00 – 18:00, March 27, 2009

Where: JW Mariott Bucharest Grand Hotel

Who: Cristian Manafu, Evensys

Basically, for all those interested in Social Media and how you can put it to use in your marketing and communication business or job, Evensys organizes, during PR Forum, a one day training focused on this topic. During the whole day, there will be a lot of interesting topics explored in various formats, from presentations to workshops and from study cases to research:

Social Media Session

• Intro to social media
• Face to face with social media
• How to define your communication strategy in the social media
• How to use social media
• How to measure ROI in social media

PR 2.0 Session

• SEO PR
• Social Press Release

Blogging Session

• How to create a successful company/brand blog
• How to listen to the blogosphere

Main speakers will be:

• Cristian Manafu
• Marius Pahomi
• Ionut Oprea
• Victor Kapra