Earlier this week I finished reading Groundswell by Charlene Li and Josh Bernoff with Forrester Research. It made the top ten of my favorite business books. My motivation to read it was for further education on Social Business, but I would recommend it for every business leader. User-generated content is taking over the web and you need to at least be listening. It may or may not be right for your company to participate and even if it is you need to determine the right tools for your culture and business model. But if you don’t do an analysis you may miss a great opportunity not just to reach out to customers but to improve your business or products.

The authors define groundswell as: “a social trend in which people use technologies to get the things they need from each other, rather than traditional institutions like corporations.” This could be an interchangeable definition with social media, except that social media is not a trend and it is not going away. It is the buzz now, and in five years it will not be the buzz anymore, but rather an integral part of your business plan.

Li and Bernoff go on to classify people into the following technographics profiles: inactives, spectators, joiners, collectors, critics and creators. By determining which profiles your customers or target audience falls into, you can narrow down the social media technologies that may be most useful to your business. There are many technologies out there, and more are being developed every day, so it is important to find the ones that will work best with your culture and business model. These technologies can not only be used to drive business and to improve product development, but also to improve your internal business processes. The book includes case studies and how ROI can be calculated from those efforts.

Businesses who have not yet implemented social media into their marketing plans are wondering why they should and what kind of ROI they can expect. There are some businesses who have had success in quantifying the return of their social media efforts. One such company is Dell. Dell has used Twitter to both improve customer satisfaction and to drive buyers to their outlet store. They were able to survey their Twitter followers to determine what percentage found out about the outlet store through Twitter and using that quantify new revenue numbers. Other businesses are also finding creative ways to do the same for their social media plans. Here’s a great article at Mashable.com with ideas on how to measure the ROI of your social media plan. Note: The slide show in the Mashable article is a good one!

Even Dell could not have known what their results would be before they put forth the effort. There is no way to know prior to implementing a social media strategy exactly what the ROI will be, but if you have clear goals such as customer retention, conversion to sales, engagement or driving web traffic, etc. you will be able to measure the results as your strategy progresses.

Social media is simply a new tool in the marketer’s toolbox. The more time and resources you invest into it and the more creative uses you find for it, the more influential it becomes. You print a brochure and it isn’t just the brochure itself that sells your product, it is also how you use the brochure. Some brochures get thrown out and have no influence and others make a difference in a person’s decision to buy.

But before you head into implementing a social media strategy, you need to have a clear concept of wha