Ted Rubin is a Social Marketing Strategist who has been CMO of several companies, including Brand Innovators, e.l.f. Cosmetics, and OpenSky, as well as Chief Social Marketing Officer at Collective Bias. He is known for his active use of Twitter. He is the most followed CMO on Twitter, according to Social Media Marketing magazine; one of the most interesting CMOs on Twitter according to SAY Media, #13 on Forbes’ Top 50 Social Media Power Influencers 2013, and number #2 on a Leadtail August 2013 list of the top 25 people most mentioned by digital marketers. His book, Return on Relationship, was released in January 2013.

What do you think the roles of the CMO and CIO should be, and what should their relationship be?

The CMO should oversee all marketing, PR, communications, customer service, and customer experience management. Every touch point with the consumer needs to come under her purview. Often this is not the case—customer service and communications are often siloed. This is a big mistake in the new marketing/social world.  

The CIO manages the implementation of useful technology that increases information accessibility and ensures integrated systems management. The successful CIO needs an intimate idea of how current technology can increase the company’s sales and not just reduce costs or improve clerical productivity, and how technology can support marketing, customer service, and the overall customer experience.  

Most often, unfortunately, the CMO and CIO make for tense allies, but it is truly allies that they need to be going forward. 

My advice is to make absolutely certain that your CMO and CIO have close ties, and learn to not only "play nice," but to do their best to understand the vital role they play as a team.  The kind of communication required to deliver the ultimate customer experience needs to run across and run through both channels. For them to be successful requires an enterprise-wide cultural shift. 

My hope is that as the new marketing world matures, building better customer relationships will become everyone’s primary objective, from sales, to marketing, to customer service—even IT departments. If that’s the true objective, then “customer relationships” truly has a chance to be the X factor in achieving Return on Relationship and enhancing ROI for the long term.

You’ve evangelized the term “Return on Relationship” In your recent book. How can a company calculate this and figure out how much it should be investing in social media and other types of online marketing?

Return on Relationship (ROR), simply put, is the value that is accrued by a person or brand due to nurturing a relationship. ROI is simple dollars and cents. ROR (#RonR) is the value (both perceived and real) that will accrue over time through connection, loyalty, recommendations, and sharing. It is not ROR vs. ROI, but rather that ROR enhances ROI. 

In the world of coordinated creation of social media stories, there are typically two kinds of success, or ROI, from social campaigns: cost mitigation and/or sales increases. But I believe there is a Return on Relationship fostered by all brand-relevant content and communication. Remember that most people will never interact with your brand directly, but in today’s social world, they are watching all your interactions with those who do, and participating vicariously. So realize that by communicating openly with the few, you are in practice engaging with the many. It is much easier than everyone thinks. 

With cost mitigation, it is important to understand how engaging, story-telling and relationship- building, which create ROR, lead to specific forms of ROI. You need to define success as the generation of more impressions than traditional media, for the same spend, or the generation of the same impressions for significantly less money.  It’s purely a CPM [cost per thousand] play. This is great for consumer packaged goods brands that have large marketing budgets, and view social as simply one part of their communication plan, and it can work for any other brands that see the importance of brand awareness.

Now, ROR does not stand on its own in the business world. Too many think, or misunderstand, that I am saying ROR is in place of ROI. It is not. ROI is always the ultimate goal. ROR enhances and leads to a better ROI. 

So how do you measure ROI?  A valuable method of defining the ROI of social is around annualized customer value. Typically a consumer who regularly and voluntarily absorbs content that references a brand in one manner or another is a more valuable customer than a non-fan/follower/subscriber. Such a consumer may spend more , visit a store or website more often and make more purchases, and remain a loyal customer for a longer period of time—and very often all three. It’s similar to legacy loyalty program metrics. Finding that annualized customer value isn’t all that difficult, and can give you a KPI [key performance indicator] for tracking when starting social, ramping it up, or pulling it back.

In addition, start measuring and looking at how a strong social presence affects your Net Promoter Score (NPS) quarter to quarter. The NPS is driven by the answer to the question, “How likely is it that you would recommend our company/product/service to a friend or colleague?” To simplify things a bit, being social drives engagement, engagement drives loyalty and advocacy, and both correlate directly to increased sales. ROR = ROI

You’ve said that companies need to listen to their customers, and also that some of your social media accounts have up to 1 million people. What techniques should a company use to be able to form relationships and listen to that many people?

Who knows your business as well (if not better) than you do? The people who work in your business, of course! And I’m not talking about the sales staff. I’m talking about your nuts-and-bolts employees who know the everyday ins and outs, whether they work with your customers, handle inventory, or do the behind-the-scenes work that helps your company run. In today’s socially connected world, employees are often an untapped resource that (with a little guidance) could exponentially expand your company’s word-of-mouth reach and ability to connect, answer questions and just simply get to know what people are saying. Empower them so they can power your business.