Redefining ROI: Return On Influence
ServiceSpace
--Nipun Mehta
2 minute read
Oct 17, 2007

 

Back in the days, ROI stood for Return on Investment.  In the Marketing 2.0 world, it stands for Return on Influence. :)  Influence refers to the ability to indirectly control or affect the actions of others.

Corporations are trying to get their users to buy things, and nonprofits are trying to get their users to donate things, and CharityFocus is trying to get users to be the change.  But we're all trying to build a road of engagement to our online communities.  The big monkey wrench for most, though, is that this online influence isn't easy to measure (and hence monetize :)).  Many folks like Jermiah Owyang are trying to define and understand 'engagement' as "the level of authentic involvement, intensity, contribution and ownership" but there are still lots of grey areas.

If you consider the question of capturing influence, though, it's an interesting one.  Take DailyGood, for example.  What would happen if we put a link in DailyGood saying, "Click on this ad to support your free subscription to DailyGood."  If mere 2% of 60K subscribers click on the ad, and let's say we just get a nickel per click, that's still $60/day and a handy $22K per year.  Now, let's say we invest that return back into the users, by not running those ads.  The influence shoots up naturally.  And then, when you compound that return year after year after year, you get the state of CharityFocus -- we have nothing but yet everything. :)

It seems that the moment you look to measure and capture return on your influence (ie. cash out), you plateau and stop compounding your influence.  And map that to the spiritual world and you can understand why the Dalai  Lama would say that he doesn't know if he's a Boddhisattva or not. :)

 

Posted by Nipun Mehta on Oct 17, 2007


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