The ROI Calculation of Social Media Tool Implementation for JetBlue

Based on the 2012 Social Media Marketing Industry Report, a significant 83% of marketers indicate that they believe social media is important for businesses.  But do they know whether social media is helping them to gain real profits?

Let’s find out utilising the Return on Investment (ROI) calculation method.

Return on investment calculation is widely used by organisations to determine the amount of profit received considering the investment input.

It has always been a challenge for businesses to determine the ROI of enterprise 2.0 implementation; since many benefits generated by social media are less tangible hence the method of ROI calculation is not always obvious.

And that’s why after analyse and asked thousands of marketing professionals, it has found that the top question social media marketers want answered from is how they can measure the effect of social media marketing on their businesses.

Today we will have a look at a ROI case study about JetBlue provided by Nucleus Research.

About JetBlue

JetBlue is an American low-cost airline incorporated at 1998; and serves 78 cities with 800 daily flights. JetBlue is well-known for its affordable price, award-winning customer service and free inflight entertainment.  JetBlue is a true customer centric business which means they mainly relied on word of mouth and for its customers to tell others about the airline as the business’s marketing style.

At August 2011, JetBlue decided to have a specific promotion team to engage customers on social media, and where else would they find a platform allowing customers to talk about JetBlue whenever and wherever they want?  Of course it is social media!

JetBlue's Enterprise 2.0 Challenge

JetBlue has been trying to engage customers on Facebook and other social media platforms previously.  But it has found social media implementation can be exhausted and involve many unnecessary work.  The business was craving for a more streamlined and templated method to manage social media marketing and communications.

After thorough research, the business has selected Salesforce Buddy Media as its social media marketing application because of its strengths in creating and managing Facebook tabs.

Benefits of Social Media Management Tool Implementation

With the help of Salesforce Buddy Media Management tool, JetBlue has gain the following benefits:

Increase social platform implementation efficiency for better promotion execution
JetBlue doesn't have to create microsites and content each time for new services or campaigns, the business can easily set up different social media campaign pages utilising one controlling system.

Increase productivity of the JetBlue promotion team
The social media controlling system also allowed JetBlue to set up different campaign to start at different date and time, the auto execution process has made the promotion team’s work much easier hence increasing their productivity.

Increase social media implementation visibility
JetBlue has increased its social media implementation visibility by accessing to social media metric monitoring and analytics. It has become easier for JetBlue to quickly understand the reach, volume and impact of an online campaign.

Key Cost of implementing social media utilising Salesforce Buddy Media
the initial and ongoing costs of Salesforce Buddy Media software for a total of 3 years has been included for the key cost:
Software license subscription fees
Initial consulting and training fees

ROI Calculation

When talking about profit gain, there are always tangible gain which contains the measurable profit, and the intangible gain containing hidden and unobvious profit which can be really difficult to measure.

Tangible Return
The reduction in creative services costs JetBlue has realised
Increase of productivity within the promotion team driven by time savings

The tangible returns were calculated using estimates of the average annual fully loaded cost of a JetBlue employee within the promotion team, the time saved by employee and the amount of employment saving for JetBlue has been used to calculate the benefit.

Intangible Return
increase productivity in other part of the business because of the less input for online media management

ROI Result

ROI of JetBlue’s Salesforce Media Buddy implementation is 140% based on calculation.

This case study looks like a great example of successful implication of Enterprise 2.0 tools considering it has taken consideration of tangible and intangible benefits.  Furthermore, it has provided reasonable calculation method utilising employee’s salary and calculate the direct saving JetBlue have had by paying for less people and less hours.

Personally, I do not think the ROI calculation is very accurate since it has made many assumptions and use only estimates to calculate the benefit returned.

So Should Business Calculate ROI for Social Media Tools Implementation?

ROI calculation for social media implementation can be tricky, and that’s why there are so many technology professionals are going against it.

Brian Halligan:  "What's interesting about social media marketing is that it's really about the thickness of your brain, not the thickness of your wallet."

Andrew McAfee: "Measure what you can measure ... and don't try to hang a dollar figure on it."

Although there are a lot of controversies over the ROI calculation for social media implementation, and it is difficult to calculate accurate ROI, but still, which business is going to implement a new technology if they cannot see the benefits?

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