The Unrealized ROI Of Blogging

Forrester recently published a report on the ROI of blogging and a follow-up case study focusing on the ROI of General Motors’ FastLane blog.

According to Forrester’s calculations, GM’s first-year ROI on the blog was 99%. The primary contributors to the top line: 1) $180,000 in customer insight, which was estimated by assuming a cost of $15,000 for running a monthly focus group with 10 participants over the course of a year, and 2) $380,000 in press coverage, calculated by estimating the value of “high-visibility Web placements” and the cost of CPM advertising on sites like InformationWeek.

Now, I’m willing to bet the $6 in my pocket that few firms will get anywhere close to those returns. Why? Because I don’t believe for a second that many firms will actually stop running focus groups or stop running advertisements.

ROI estimates based on cost displacement are only realized if the expenses to be displaced don’t get spent.

Two implications for marketing execs:

1) Budgeting and investment allocation decisions that exist within departmental silos are practically guaranteed to prevent cost displacements that occur outside that department (talk to your IT folks, they know all about this), and

2) If you’re going to tout the potential ROI of blogging to your CEO, you’d better be ready to make some tough decisions about where the money to fund the effort is going to come from (talk to your analytics folks, they should be able to help you here).

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