Social Media ROI Not As Mysterious As You Think: 8 Ways To Measure It
Social Media ROI Is Important for Executive Buy-In
Social media marketing is a powerful medium to reach big audiences, build one-to-one relationships, humanize your brand, leverage influencers, and spread positive word-of-mouth. But in order to capitalize on this opportunity, you need to be able to effectively communicate how you plan to execute and how this will translate into ROI that's meaningful for higher-ups.
Don't Let Social Media ROI Be Your Barrier To Entry
Many marketers are hesitant to invest in social media marketing because of fear there won't be any way to definitely prove social media ROI to executive management. However, measuring social media ROI isn't as challenging as you may think. It largely depends on a solid strategy, using the right metrics for your brand, and regularly assessing them.
Social Media Starts with Defining the Right Objectives
You can't prove social media ROI if you don't set objectives. Setting appropriate goals in the very beginning is paramount. Goals need to be aligned with overall business objectives. You should be able to translate these goals into a language everyone in the company can easily understand.
Examples of Business Objectives for Social Media ROI
- Corporate brand awareness
- Product brand awareness
- Increase in website traffic
- Increase in sales
- Build a database
- Customer engagement
- Customer loyalty
Remember to set SMART goals - specific, measurable, attainable, relevant, time-bound.
Here Are 8 Ways To Measure Social Media ROI
1. Referral Traffic
Set a goal for an increase in referral traffic from social channels or even particular social channels. This is pretty easy to measure in Google Analytics and most social media management/measurement tools provide this data. Referral traffic shows people are interested in your brand and want to learn more. Driving website traffic also gives you an opportunity to capture lead information for nurture and eventual conversion.
Example: Increase social referral traffic by 30% within the first three months of social media execution.
2. Email Collection
This is one of the best ways to measure social media & content marketing efficacy, and it also gives you a way to continue nurturing relationships to conversion. With social media and content marketing, building a database of emails is your "currency," because you can use email marketing as a lead nurturing and sales tool. This can be done in compliance with HIPAA as long as you provide the necessary disclosures to consumers before opt-in.
Example: Increase our database to 5,000 targeted contacts within six months of launch.
3. Coupon Redemptions
This is a very trackable metric, allowing you to directly attribute social media outreach to purchase.
Example: Get 1,000 social media coupons redeemed within the first six months of the campaign.
4. E-commerce Sales
If you have an e-commerce website, you can measure social efficacy by measuring traffic from social media to your e-commerce site. You can even measure how social visitors translated into sales.
Example: Increase social-driven e-commerce sales by 5% within the first four months.
5. Increase in Brand Mentions
Increases in brand mentions can be measured with a social media measurement/analysis tool. More people talking about your brand is a good thing, equating to increased awareness and reach.
Example: Increase brand mentions by 10% within the first six months of the campaign.
6. Increase in Positive Brand Mentions
Similar to increasing brand mentions, increases in positive brand mentions can be even better - it means people are talking about your brand, and, in a positive light. Positive word-of-mouth can be powerful, especially on social media, where positive brand conversations can drive more people to learn about your company and purchase.
Example: Increase positive brand mentions by 8% within first six months of the campaign.
7. Community Growth
This is the classic social media metric that gets a lot of grief for not being as easy to attribute to quantifiable business growth. While it's not necessarily a direct indicator of sales revenue increases, it can still be a valuable metric because it shows you're appealing to your audience and staying relevant (especially if they're not dropping off). This can be a good metric if your goal is to increase awareness. People in your community at least know your brand name and some probably know a lot more about you. Just remember to stay focused on building the right community, meaning targeted followers who are a good fit for your brand. Building a community of disinterested, unrelated followers is ultimately useless.
Example: Increase Facebook following by 3,000 new fans within the first six months of the launch.
8. Returning Visitors
If you're driving visitors to your website, you can also measure the percentage of return visitors coming from your social channels. This is valuable, because it shows a deeper level of engagement and a stronger relationship than just visits alone.
Example: Increase percentage of return visitors from Facebook from 38% to 56%.
Social media ROI isn't rocket science.
It's just a matter of correctly executing a well thought out strategy, knowing what metrics are most meaningful to your company, choosing tactics and channels most likely to affect these metrics, proper measurement, and intelligent adjustment.