ROI on The Coffee Mermaid Lovers-Starbucks in Taiwan

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In business concepts, Return On Investment (ROI) is a term for the benefits gained from an investment. The formula is the net profit, or total amount gained minus original invested amount, divided by the invested amount *100%. The purpose of identifying this figure is to evaluate and decide whether or not to the current investment is economical.

Image (Source: www.roionline.co.za )

For a traditional business, the benefits can easily be seen and calculated as long as the sales figures handled correctly. Yet in a social media marketing perspective, there are more to be taken into account than merely capital gained. According to a report by iContact, how to determine ROI on social media is a great uncertainty for businesses. As the strength of social media is sometimes rather unpredictable, there are both tangible and intangible benefits that come from social media marketing. Unlike reading an accountancy report, there’s no universal rule to calculate ROI in social technology.

Following my case study in my previous post, I will use Starbucks Coffee Taiwan to discuss ROI on their promotion in social media. Starbucks was introduced into Taiwan by Starbucks Coffee International, Uni-President Enterprises Corporation, and President Chain Store Corporation in 1998. The Facebook fan page(統一星巴克同好會)was established in 2009;  0.5 million fans 2010; 846,000 by 2011; 1 million fans by 2012; 2013.10 1.5 million fans.

DA13_002(Source: sharpdaily.tw)

To discuss the effectiveness and ROI of Starbucks Taiwan using this Facebook fan page, I am going to make some assumptions as follows:

Starbucks Taiwan Human Resources (HR)employees a team of three full-time staff to run the social media marketing program, let’s assume their salaries per month are $55,000 NTD for the team-lead, and $35, 000 NTD for the other two team-members. A sum of HR cost in SMM is 125,000 NTD per month. Cost per annum would be 1,687,500 NTD (12 months’ salary + 1.5 months’ standard annual bonus). The total HR cost of running the program for 5 years would be: 1,687,500 *5 = 8,437,500. Possible pay rise and bonus are excluded in the equation, yet to make things easier, let’s round it to 8,500,000. Additional one-off cost such as 200,000 NTD on equipment. This team would most likely be located in the same building as the President-Union Corp. Ltd., therefore, cost like phone-bills, internet connection, office rent can be overlooked. Total investment of the social media team since establishment is $8,700,000 NTD.

Furthermore, I have set three scenarios as follows:

Scenario 1:

If the 1,517,251 (reached last month) fans each enjoyed just one coffee (say a Grande Latte) at Starbucks each month in 2013, their total sales from this crowd would 2,184,827,040 NTD (1,517,251 Fans *$120 NTD *12 mths)

Scenario 2:

If only half of those fans visit Starbucks once a month; the sales would be $1,092,413,520 NTD in 2013.

Scenario 3:

Let’s assume that each fan was encouraged and has had merely one Grande Latte since they clicked “Like.” Their sales from the fan page alone over the 5 years would be $182,068,920 NTD (1,517,251 Fans *$120 NTD); rounded at $182,000,000 NTD.

Scenario 3 is selected for discussions despite the unlikeliness of such low purchase rate. A college friend of mine who works at 7-11 convenient store(President Chain Store) told me that there is a net profit of roughly 50% I coffees sold from City Café (inside the convenient store). Let’s say Starbucks Taiwan, being a joint company with Starbucks Coffee International, has a lower percentage of net profit, so let’s take away another 25% as the cost of royalty, staff salary, utilities, etc.; that gives us an estimate of 25% of net profit.

The ROI of Starbucks Taiwan utilizing a Facebook fan page over the course of the five years is calculated as follows:

 {(182,000,000 *25%) – 8,700,000 / 8,700,000} *100%= 423%

Looks pretty impressive to invest in social media, right? These are just the tangible benefits estimated merely by the number of fans on their Facebook page. Bear in mind, that the figures in the assumptions reagarding th cost is not accurate and may be an underestimate. Assuming the 80-20 rule is in play, so let’s say 300,000 fans each somehow brought one of their friends to each a Grande Latte; that’s another 36,000,000 NTD of sales.

d110935 (Work by Douglas Hamilton,100 Sexiest Women in Nonexistence)

What about intangible benefits? This would be the “hard-to-determine” part of the greater equation. What about sharing the message of a promotion such as “Buy 1 Get 1 Free Day”? This has always been a big event that produces extremely long lines at every store. Personally, I first heard about the event on Facebook two years ago, and I am still not a fan of Starbucks fan page. Though, the promotion itself may not generate profit at all, yet it surely draws a huge crowd and attention; more check-ins or uploads on Facebook while they enjoy their coffee. Intangible benefits like branding, gaining popularity, earning new customers, and sales of accessories. A chance to serve people who can seldom afford to enjoy Starbucks and customers who do not use Facebook can also add to marketing by the word-of-mouth. The truth about ROI in social media needs to be looked at holistically and consider the amplifying effects from the fans. Starbucks Taiwan had operating revenue of 59.52 billion NTD and 4.67 billion net profits in 2012.

What are your thoughts?

Reference:

Where’s My ROI on Social Media Campaigns?

10 Examples of Social Media ROI

Calculating Social Media ROI

3 Myths of Social Media ROI

How to improve your social media marketing return on investment

(The following reference are in Chinese)

Socail Media Applications

On Starbucks Brand

Reaching 1million fans

Reaching 846,000 fans

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Social Monitoring the Global Coffee Mermaid-Starbucks

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I am sitting in Starbucks enjoying hot latte café in a mug in a cool afternoon. I am chilling in one of more than 280 stores in Taiwan while browsing the internet through pre-paid Wi-Fi service. Starbucks is certainly not a choice of my cheap daily shot of caffeine when comparing to 85C Bakery in Taiwan; a cup of latte is roughly the same charge compared to Starbucks in Australia, but an average Taiwanese worker earns approximately $900AUD a month. There is a certain value of the brand Starbucks that makes it so popular here in Taiwan; hence I am going to write my post about social monitoring on this famous American coffee brand.

starbucks(Courtesy of Starbucks)

For those of you who have not yet had a cup of Starbucks coffee, here’s a brief introduction of Starbucks: Starbucks is the largest global coffee house company in the world with its headquarters based in Seattle, Washington. It was founded in 1971 and currently has stores in 62 countries. Starbucks serves hot and cold beverages as well as sandwiches and snacks. Basically, it is your local café on a global scale. Starbucks Taiwan is operated by President-Union Group when it joined the Starbucks Coffee International chain in 1998.

There are a lot of social media monitoring tools. Here I am going to demonstrate my findings using three free social media monitoring tools; Socialbakers, Social Mention, and Addict-o-matic.

starbucksStatistics_Socialbaker

According to Socialbakers, Starbucks is ranked #4 with 35,324,413 fans in the Top 100 Facebook Fan pages. The distribution of fans consists of 47.5% from the USA and 2% from Taiwan. There are also different statistics for the brand of different regions. Starbucks ranked #5 on Twitter and a rise of followers can be seen. As of now, there are almost 4,700,000 followers on Twitter. On youtube, there are 218 videos with 8305407 views.

StarbucksNew_SocialMention

On Social Mention, there are 248 unique authors with an average of 8 seconds per post as of now. When I set the filter at ‘Any time,’ it has been given a 35% in strength to indicate the likelihood of the brand being discussed (phrase mentions is the past 24 hr.) Other figures include ‘Sentiment’ ratio of 11:1; meaning the positive posts out run negative ones dearly. 56% ‘reach’ shows their range of influence. Nevertheless, figures are constantly changing, yet judging over the greater period of time, Starbucks seems to be doing well.

Starbucks_AddictOMatic

Using Addict-o-matic, search results showed numerous blog post, YouTube videos and news articles that show great relevance to the Starbucks brand. Yet, the Twitter search function is experiencing a technical problem and returning no search results. There are 710,463 results for Starbucks on WordPress.

People talking about starbuks_Socialbaker

(Source: Socialbakers)

By looking at results from the three free social monitoring tools, I have discovered Starbucks to be a very powerful brand amongst the community. Graphs provide viewers an easier interpretation of the results. Despite the positive findings, I question the accuracy of the statistics. For example, in using Social Mention, while it returned relevant results for Starbucks, it showed otherwise for other brands like ‘Giant’. Therefore, a more thorough browse of the results is necessary to evaluate the findings. For social monitoring tools that are free of charge, I would be satisfactory on giving brief idea of social performance. More detailed analytic material can be accessed when premium version is purchased. Social monitoring can help business in many ways provided the statistics are accurate. However, I wonder if the paid software tools does the job better?

Reference:

Starbucks Official Website

Starbucks on Wikipedia

85C Bakery Cafe

Socialbakers: Starbucks

Social Mention: Starbucks

How Starbucks Use Pinterest, Facebook, Twitter, and Google

50 Top Tools in Social Monitoring

Social Monitoring Comparison

Legal Leaders In The Community: Eversheds

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The social economy from the Mckinsey Global Institute (MGI) speaks of the benefits of utilizing social media. In my previous posts, we have covered general business sector and social sector. Now, I am going to talk about professional service sector which lawyers, accountants and other respectable professions fall into.

While it is very beneficial, it is not so much widely incorporated amongst these professionals. As MGI reported the majority in the professional sector still lacks the use of social media, or lacks the drive.

These professional services follow the old saying “time is money,” literally. For them to spend costly time to learn or use Facebook or Twitter may not be an economical choice in the short run. Moreover, some may worry about their reputation if something goes wrong.Some may even argue that the serious customers of these professional services would not take into account social media for their choice of selection.Yet, the bonding relationship with existing and potential clients as well as the branding of a professional image to potential clients is unquestionable.

One of the top leading examples in the legal industry is Eversheds. Eversheds has over 40 offices around the globe making it one of the largest law firms in the world. Eversheds has also won many awards to add to its prestigious name.

According to the full report by Living Ratings, 2013, Eversheds ranked 3rd in the study consisting of accountancy and law firms and being the top of law service in the list. Eversheds is a clear example of branding itself and exercising PR using social media. The content on its blog spot are original post from their related counter-parts. Links between Blog spot and Twitter is well connected and can help users uncover interesting contents. Blog post can be shared amongst major social media. Its YouTube channel has more than 11,000 hits in total. Twitter was the most popular tool used followed by Facebook and LinkedIn. Twitter is well maintained and up to date. Eversheds uses SlideShare to provide educational material to the community. A Facebook fan page for trainees to build relationship and uncover talents for Eversheds.

EvershedsHub

Eversheds has devoted a great effort toward social media and has successfully gained leverage in Marketing and Sales as well as Business Support (McKinsey, 2013). It has well branded itself as 21st century law firm. However, some levers are least likely to be used by a law firm such as crowdsourcing and customer service as the material dealt is almost always confidential.

Reference:

Eversheds top as lawyers lose out to accountants on social media

Social Media for Professional Firms:Are you serious?

A Quater Million Social Movement- Social Media Levers In The Social Sector

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It is the sixth week in my journey into blogging, and I find this week’s activity most inspiring. From previous lectures, we have only touched on the power it has on enterprises; i.e., corporations that gain profits or even lost capital due to social media. We have also touched on the legal hazards that social media brings to individual employees as well as employers. There are levers of social media describe in the McKinsey report that work for the social-sector organizations. For this week’s activity, I am going to tell you a story; a story of a young man whose life inspired a recent social movement in Taiwan.

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(Photo By Jake Sun)

On 3rd, Jul, 2013, the Hung family received a call from a military officer with information that Corporal Hung has suffered a severe heatstroke and was being treated at a hospital; Hung, Chung-chiu (24) was 3 days away from his honorable discharge of compulsory military service. The next day, their parents made the decision to unplug their only son.

That is the end of the story; story of Hung’s short-lived life. To many, this was just another sad story for an unlucky fellow: It was mid-summer in Taiwan, his BMI was at 32, and the training was just too much for him; that’s what the military told the corporal’s family. Here are the facts:

  • Hung had been held at a detention centre for two days for carrying a cell phone with a camera (note: not a smart phone); rules state such violation should only receive a warning.
  • Hung’s full-body fitness check results to determine fitness came out as qualified, despite BMI at 32, that afternoon; the acceptable BMI is 30 and the assigned process time is seven working days.
  • On the morning Hung was admitted to the hospital, he had received physical training under the sun at a temperature of 32°C; rules state all physical trainings are forbidden.
  • When Hung arrived at the hospital, his body temperature was 44 °C (108 °F); average man 36.5 -37.5°C.

Now, if you are having second thoughts, you are not alone. The Hung’s family disclosed such incident as they find it to accept the military treating it as merely an accident in the course of training. The news media had scanty reports at first. The online community, with fear of this incident would wither, posted on a major BBS(Bulletin Board System), PTT, in Taiwan, to hope for some insights and clues. It spiraled from here; discussions happened over major boards on the site. The discussion attracted main stream media’s focus to throw more wood into the fire. Why? If the cause of death was an accident, there would be no one held responsible. The military had been seemingly hiding the truth. During that summer, the greater community and the general public became detectives and forced the truth to surface.

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(Snapshot of Facebook Fan Page)

How is the social media lever used? The following will explain from a social movement perspective accordingly:

Collect information and insights:

Gather information: There a lot of clues from the community’s search and tip-offs from anonymous users who are said to be currently in service. Colleagues that were also at the detention centre came forth after their discharge and reveal what they saw.

Crowd-sourcing: Almost every able man in Taiwan has either had their time in the military or heard stories. People with good knowledge of the military, physicians, crime scene experts are able to offer their opinion. People with respective professions and relative experience shared their insight that busted the military

Mobilize resources:

Create and expand volunteer network:  Citizen 1985 was formed simultaneously by 39 strangers consisting of men and women from all walks of life. PTT and Facebook fan pages have greatly expanded the network.

Retain Support: The fact that mainstream media pay great attention to what started on PTT gave great strength throughout the country, this involved a greater population of the older generation who do not use social media to support the campaign.

Execute mission:

Educate the public: Before this, the general public would only hear stories about the dark-side within military. It educated the general public about law and justice like how the rest of the world enforces martial law when they are not at war.

Engage supporters: The climax of this social movement was the gathering and protest of the “the white army.” This was not a sponsored event as they had refused any sponsorship, including water or food. Participants are asked to wear white clothing of their own, a traditional colour for condolences in Chinese culture.

Organization wide levers:

Improve collaboration and communication: Citizen 1985 communicate with each and its supporters though its fan page and related social medias to discuss and plan campaigns.

Rapid organizing: On the 20th Jul, Citizen 1985 organized its first protest with a crowd of 30,000 wearing white when it originally targeted at 5000.  On 3rd Jul, the second protest and the climax of this social movement had a total number of “the white army” participants formed a crowd of 250,000.

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(source:http://images.takungpao.com/2013/0805/20130805084858647.jpg)

 

Corporal Hung’s death inspired the social movement to improve jurisdiction and unveil the dark cloth covering the secrecy of the military community. As every citizen in Taiwan has a family or friend who had served, is serving, or will serve their compulsory time, this was a mutual fear and anger. His death brought attention to the other over 1000 military questionable accidents or suicides that happened over the decade. The previously stand-alone protestors of mothers and fathers gained more support and gave more strength to endeavor this movement.

As a result of this social movement, the Secretary of Defense and its successor had both resigned. The Legislative Yuan (legislation house) passed a bill in short time submitting military prosecution rights to judicial (administration of) justice at times of peace. After the investigation, 15 officers and sergeants were prosecuted with the highest-ranking officials of a Major General and second highest-ranking officials of a Colonel.

Further reading:

More Pictures

CNN report on Taiwan Military 

Taiwan’s military face reform pressure after conscript’s death

References:

http://www.ptt.cc/

https://www.facebook.com/pttcitizen1985

 

Wow Legal Issues for Big W

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On Monday 19 Aug, 2013, we were very lucky to have a guest speaker Lawyer Malcolm Burrows give us a lecture about legal issues using social media in business and social media policy. As for my previous post, I talked about how Big W uses a facebook fan page as its social media, therefore, I will use it as an example to discuss some legal issues. Woolworths Ltd is the parent of Big W, and it has an Social Media Policy (SMP), which Big W employees should falls under.

According to a case study, Big W should encounter a similar situation; as a retailer with so many products, it is almost inevitable for a customer to find fault in a product that may lead to a complaint online, sometimes more exaggerated. Big W should always double check the contents being put on facebook fan page, and remove any misleading and deceptive information. I believe Woolworths Ltd Group takes good care of their social media judging from a past incident.

As their SMP forbids employees to speak or give information to any media without authorization, it sets a standard for employees to disclose issues even after work hours. It does not forbid personal use of social media, however, one of the legal risks for the employee is when these personal posts become an inference to one’s work.

AWE

Besides public social media, Woolworths Ltd also utilizes Association of Woolworths Employees  (AWE), which is hosted by Yammer, and also Allyours as their internal social network. There are a few issues involved in a private social network within the corporation. Discrimination, for instance is one.  Although, any dispute with the private social media is likely to cause an impact on the business, it makes each individual liable for one’s own actions.

allyours

Wow on facebook-How Big W Uses Social Media

Most companies nowadays, big or small, use of social media technology to help their business. Some have facebook fan pages, and some have a self-hosted blog, the others have both. According to the report from McKinsey Global Institute, 2012, there are ten levers for a company to use social media. For week 4’s activity, I have looked at several companies’ social media uses and selected one company and discuss the leverage.

The company I have selected is Big W. It is one of the leading mass retailers in Australia, with known competitors like Kmart and Target. The reason I chose Big W for this discussion is that it takes care of facebook fan page and replying posts timely, no matter big or small.

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The two social media lever Big W have utilized is marketing communication and customer service, and especially in dealing with customer complaints.

The Big W facebook fan page, posts reminders of important dates and suggestions for gifts; e.g. Catalog for Father’s Day. While products cannot be purchased directly, it draws customers into local stores or onto the official website where purchase and delivery is possible.

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When a customer complaint is well dealt, it not only keeps the old customer, but also demonstrates good customer service and builds reputation.  Big W gains a lot of strength on this two levers; comments from customers may inspire new ideas for other customers on gifts or better buys, or maybe help Big W match prices before losing a customer. Complaints from customers can truthfully reflect what each individual has encountered locally and give the company a second chance to make it right.

Too Slow to Boil; To Hot to Drink – Social Tools Easy To Use

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This is supposed to be a Week 3 post and it’s now Week 5 ( Good job trying to lay an egg!) A brief on what’s going on for those readers that are not from the class:

The task was to select one of the two topics and frankly, I am “the rookie” in both information technology and blogging; I chose option 1:  

How can web 2.0 tools assist with your own personal productivity?

Although this seemed a rather easy topic, it’s not. At least, not for me. I am fresh to pretty much everything except facebook. I have always been skeptic about signing up on social medias, and now I have to create a productive virtual identity.

Over the past few weeks I have stretched my knowledge  with these new social media tools and explored some new social community websites.  My feeling: It’s like boiling tap water in a kettle; “Easy to access as long as you have a running tap (internet), a kettle (computing device), and a stove (myself).”

What’s true about this metaphor is that I wouldn’t know if it’s productive until I hear the whistle. So I guess, I don’t really have an answer to using these tools to be productive. However, I do have some ideas about the following.

1. Twitter: Best thing for me is that I get to follow Jeremy Lin and Valentino Rossi now. One of the hardest case to crack is to figure out how to use the “hash” cleverly and  get followers to see me. And of course it always helps to say something true.

2. facebook: I have just recently signed up on fb again with the intent to see what my friends are doing and what sort of stuff they “share.”  Most of my fb friends are from Taiwan, so it’s a good way to keep in touch with the stuff happening over there.  It would be a good way to share my posts at WordPress on my wall for my friends.

3. WordPress: WordPress is my first blog plaform and it has been pretty easy to use. Although I would say it would take some time to fully organize it, such as using right Tags etc. I am loving it.

4. Youtube: It’s suitable short video clips to reveal certain issues or promote popularity. The comments below is a great community for discussion. There are a lot of self-made popular channels as examples.

5. RSS: Years ago, I actually had a try at getting a blog at Yahoo! It didn’t workout because I had no content or anything interesting enough to offer. Yet, I did get a taste of RSS from other bloggers about food and health. This is a great feature to use, but the catch is too much emails.

These tools mentioned above are just my personal take at starting in the social community.  To be more productive, I would like to learn about drawings using software and video editing to produce original pictures and videos. If you are already a blogging guru and took the patience to read the post, I certainly wouldn’t mind getting a free lecutre. However, if you are as fresh and green as I am, I believe these should be plenty to get it going and keep you busy.

(img src: http://www.bethanydumfries.org/wp-content/uploads/2013/03/kettle-boiling_6.jpg)

 

Spot the Snowflake in Blogging

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Hey there guys, I am a rookie in blogging. It never occurred to me that blogging could be such a hard case to crack until I tried this first post. After spending some time reading advices from ‘experts in blogging,’ I have come to suspect that there are no real tips of promise to success. Truth about blogging is that if a blogger wants stand out from the crowd, experiment something different.

Take a metaphor of the mma fighting octagon, while the majority of the fighters start the fight standing up, I am going to lie down. Below is my phase 1 strategy:

  1. Write an article with content: Just as the mma fighting metaphor, to fight, one would at least have one well developed fighting techniques to demonstrate. A fighter does not have to look like GI JOE figures (although eye catching) but what it takes. Good content beats fancy words.
  2. Be consistent and persistent of writing at a regular schedule: Punctuality in blogging, as well as in everything else, is a great virtue to keep fans interested or new readers curious. A ripple effect is having the readers look forward to the next air drop.
  3. Read and comment when one has content to say: This is body of the metaphor. Lying in the ring and study the opponent as well as the crowd. Instead of merely saying hi or posting a link, act like a mirror and respond to their ‘baby.’ Although bloggers tend to return ‘visit’ favours, an serious read through of post is what I aim for.
  4. Expect the unexpected: Occasionally, light posts, possibly personal side, between regularly schedule posts. Let’s the crowd see the lighter side of things and more of my personality, a most distinctive signature. Twitter or facebook may come into use at a later stage.
  5. Be original: Plagiarism in blogging is as severe as legal liability. It puts an enormous question mark on the character. Give credit and reference since most bloggers are very happy to save a spot on their shoulder.

Just as all experiments, the results of the above may not always be what is anticipated. While ‘big things have small beginnings’ (Prometheus 2012), I wonder if the snow ball will roll down the hill, but, at the very least, I have my first snow flake.

(img src=http://a395.idata.over-blog.com/500×359/4/02/14/58/articles/chaque-flocon-de-neige-est-unique.jpg)