With marketing and advertising, business managers do not always see the real tangible value in their investment. How much money will an investment in a blog make? John Wanamaker, the famous American merchant and pioneer advertiser said:
“Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” – John Wanamaker
Is blogging the modern equivalent to advertising? Most people don’t think so. The big difference between advertising in Wanamaker’s times and blogs today is focus and participation. Wanamaker could not focus his newspaper advertising to a target audience. So most newspaper readers simply avoided his advertising, it was not meant for them. This explains why Wanamaker believed he “wasted” half his money. Also, Wanamaker’s advertising was not a conversation with a reader. It was a one way channel. Blogs are two way, actually multi way channels with comments from anyone who is interested in the conversation.
The monetary hard cash value of a blog can be measured first by direct clicks to an order page. Mention a product, describe a feature, show a useful application and send the reader to an order page. Another way to measure a blog’s value in support of product information. A blog reader may not want to order a product right now, but he still can get more information to convince him to buy later. This is by far the most popular use of blogs in direct sales. Product information in a very detailed level is used to support order sites. Here it is not clear how quickly a blog post becomes an order, so the real value of a blog is indirect.
Blogs are also excellent customer retention tools. Robin Poole’s famous quote comes to mind:
“It’s easier to keep an old customer than it is to get a new one.” – Robin Poole
Keeping customers engaged with information is one of the best way to use a blog. Customer blogs are also used to create communities of customers, these is the best retention tool today. In technology companies: Microsoft, Google and Oracle use blogs to inform and engage existing customers. Here accounting for real value is a little harder. With statistical analysis managers can tell how engaged customers in different geographic regions correlate to customer loyalty. Managers can also measure blog effectiveness by supporting one product with blogging and another with other customer loyalty programs (e-mail newsletters, rewards programs, coupons, etc.) Then comparing the customer retention results of the two products. In some categories, like software and office supplies, blogs are extremely effective in customer retention.