Forget ROI, Think Return On Health

Stop me if you've heard this one before: "Before you go any further in your presentation, I'm going to need you to discuss your process for measuring ROI."

It's long been the question that most agencies dread because they have failed to come up with a concise and coherent answer. PR and social media agencies, in particular, are viewed as cost centers as opposed to profit drivers, and fumbling that question confirms the suspicion of many executives. In the case of pharmaceutical marketing, the conversation of how to implement social media often starts and ends with that very question.

The pharmaceutical industry is one that is highly regulated when it comes to communicating directly with patients, making social media a complex endeavor. Because of this perceived risk, marketing executives want to know the ROI of social media down to the last penny.

In some ways, the ROI question is an intentional landmine planted to trip up unsuspecting agencies and bolster the case of hesitant healthcare companies that would prefer to stay on the sidelines. ROI makes for a convenient excuse to move on and maintain the status quo without mucking around in the regulatory mess.



Don't get me wrong, the ability to use firm measurements such as ROI is important. But to rely on it as the "end all, be all" for social media success is a quick path to failure. Instead, pharmaceutical companies should consider integrating more progressive ways of thinking such as Return on Health (ROH) that focus on the patient. This falls in line with the primary motivator for many pharmaceutical companies to engage in social media in the first place -- connecting patients and fostering better health outcomes.

There is a fundamental flaw in using ROI to measure social media engagements. It's an antiquated and limited form of measurement. By its nature, ROI implies a set period of time and uses the bottom line as the sole determinant of success. That's great for an advertising campaign that has a finite amount of time. But social media is not a campaign -- it's about sustained engagement.

Campaign thinking falls flat for social media programs because it promotes a short-sighted approach. Companies should focus on leading indicators to evaluate success, not lagging indicators that are only useful upon conclusion. What about measuring success during a social media engagement -- providing the opportunity to course correct if something is not clicking?

ROH is less of a hard-line metric for measurement and more about establishing a decision-making framework from the outset of a pharmaceutical social media engagement. It puts the patient at the center of every program and gets to the question of why healthcare companies should engage in social media.

Uniting patients around disease states, providing access to information on living with and caring for an ailment or boosting patient prescription compliance are all lofty goals that have a clear ROH. By focusing on the patient in all of your social media efforts, you will have a decision-making framework that allows you to engage transparently, communicate honestly and educate rather than exploit. The same can't be said if your focus is squarely on boosting revenue.

Let me be clear: I'm not suggesting that making money is a bad thing. I am suggesting that starting with the question "how will we make money?" and working your way to the patient will lead to irrelevance. I assure you, if that model is flipped and you start with the patient -- the money will follow.

3 comments about "Forget ROI, Think Return On Health ".
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  1. George Watson from Plain English, April 30, 2010 at 12:10 p.m.

    I don't see many marketing recommendations this well written. I'm impressed. And the recommendation is smart marketing for any client - start with the consumer, add value, the money will follow. ;-)

  2. Chris Iafolla from WCG, April 30, 2010 at 12:19 p.m.

    Thank you George, I appreciate that! And I like your three-step summary--nice and simple.

  3. Nicola Ziady, July 30, 2010 at 2:04 p.m.

    Thank you for sharing insight into this hard to define topic. I attended the Strategic Social Media for Healthcare conference in New York this week in which we discussed the same topic. I appreciate your aspect of ROI and how we can directly apply it to our revenue source. Great outlook. Thank you again, Nicola Ziady @nicolaziady

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