56% said an inability to tie social media to business outcomes 39% said a lack of analytics, expertise and/or resources 38% said poor tools 35% said inconsistent analytical approaches 30% said unreliable data With that being said, measuring the ROI of your social media marketing efforts isn’t impossible. In this post, you’re going to learn: What social media ROI really is Why you should be measuring it How to define your goals How to track and measure your goals Which tools can help you What Is Social Media ROI? Aside from avoiding wasting your time, you need to measure your social media ROI because: You’ll see where you can improve your efforts You’ll be able to decide which social media channels are bringing in the most revenue for you You’ll see how specific changes impact your social media goals Imagine if you blindly ran Google AdWords campaigns and never checked how much you were paying per click, what kind of click-through-rate you were getting or whether any of the people who clicked on your ads were actually converting. But that’s exactly what you’re doing by not measuring your social media marketing efforts. The second part that’s important is linking your goals to specific campaigns. A campaign is a planned out effort with set goals and a measurable outcome. Track & Measure Your Goals Once you’ve defined your goals, the next step is to track them. To figure this out, you can use: Lifetime value x conversion rate: Calculate the lifetime value of a customer, and multiply that by your conversion rate (average number of email subscribers who become customers) to find out what the potential value of each visit is. Here’s a quick recap of the tools I’ve mentioned: More Than Just the Numbers While having numbers and data is nice, you also have to account for the indirect benefits you get from social media. Tracking Social Media ROI is Possible!
Social media ROI is one of the most heavily debated topics in the online marketing world. Why? Because measuring the effectiveness of social media marketing efforts isn’t as clear cut as, say, running a Google AdWords campaign. It’s hard to tell how much revenue a Tweet you sent out last week brought in, or if your last Instagram post boosted your bottom line.
And judging by the numbers, a lot of businesses are struggling to grasp the financial impact social media marketing is having for them. In a survey from Convince & Convert, 41% of companies said they had no idea whether or not their social media efforts were actually paying off.
A separate study gives some insight as to why companies aren’t measuring their social media ROI. This survey looked at some of the specific challenges companies are having when it comes to measuring the value of their social media marketing efforts.
- 56% said an inability to tie social media to business outcomes
- 39% said a lack of analytics, expertise and/or resources
- 38% said poor tools
- 35% said inconsistent analytical approaches
- 30% said unreliable data
With that being said, measuring the ROI of your social media marketing efforts isn’t impossible. The problem is that most companies get so tied up in vanity metrics—like the number of followers on Twitter or Likes a Facebook post gets—that they forget those numbers are really meaningless in the grand scheme of things.
It’s time to clear the air and do a deep dive into tracking the return you’re getting across your social media channels. In this post, you’re going to learn:
- What social media ROI really is
- Why you should be measuring it
- How to define your goals
- How to track and measure your goals
- Which tools can help you
What Is Social Media ROI?
You can ask five different people this question and get five different answers. The truth is the definition will depend on what your specific goals are. But at its core, social media ROI is what your company is getting back from the time, money and resources you’re putting toward social media marketing.
Ideally, your return would be measured in terms of dollars. That means you should know:
- How much money is going into your social media marketing efforts
- How much money your social media goals are worth
For most companies, the first part is easy. The second part is where things get a little tricky because it’s completely dependent on the goals you set. But don’t worry, we’ll cover both pieces of the puzzle.
Why You Should Measure Social ROI
Let’s be honest for a second. The reason a lot of companies get into social media marketing in the first place is because it’s mentioned on just about every website that has anything to do with marketing or business. You hear stories of how the top companies are “dominating” on social media, and how it’s where your audience is, so you have to be active on sites like Facebook, Twitter, Instagram, etc.
But unless you’re tracking what you’re doing, what’s being spent and what kind of results you’re getting, it’s really difficult to determine whether or not anything you’re doing is working.
Aside from avoiding wasting your time, you need to measure your social media ROI because:
- You’ll see where you can improve your efforts
- You’ll be able to decide which social media channels are bringing in the most revenue for you
- You’ll see how specific changes impact your social media goals
Imagine if you blindly ran Google AdWords campaigns and never checked how much you were paying per click, what kind of click-through-rate you were getting or whether any of the people who clicked on your ads were actually converting. Sounds like crazy talk, right? But that’s exactly what you’re doing by not measuring your social media marketing efforts.
3 Steps to Measure Social Media ROI
Unsure of where to start? Don’t worry. We’ve broken down the process of how to measure social media ROI into three simple and easy to follow steps.
1. Define Your Social Media Goals
Like I mentioned, before you can get into measuring your return, you have to start by setting goals. Your goals should be quantifiable and linked to a specific campaign. In other words, they should be things that you can attach a number to. Some good examples are:
- Email list sign-ups
- Contact form inquiries
- Downloads of a whitepaper or ebook
Notice how all of these goals are based on the user taking a measurable action that can be tracked. Metrics like social shares and followers are nice to track too, but they shouldn’t be your main goals.
In order to get the the most accurate number, you really want to set your goals based on actions that convert a casual…