How do we measure Social Media Return on Investment (ROI)?
We might as well ask ourselves how can we nail jello to a wall. The question seems rhetorical. It’s not possible to accurately measure the ROI of our Social Media marketing and social media campaigns . . . or is it?
Reviewing hundreds of sources for answers to this question resulted in something very curious. There seem to be just as many experts/gurus and man-on-the-street marketers who insist it CAN be measured as there are those who insist social media ROI CAN’T. So much for consensus and clarity on this conundrum.
I tend to lean toward the opinion that the social media marketing activities of entrepreneurs and businesses CAN be measured, but rarely with any consistent criteria from one business to the next. I suppose that has a lot to do with the unique goals that each marketer has for their social media marketing. One business or entrepreneur needs to determine how many conversions they are getting from their Facebook Page, while another business is more concerned with the traffic that their Pinterest page is directing back to their blog.
Different goals = Different measurements
Either way, it seems to me that knowing how to measure your Social Media ROI has at least some level of significance to your current and future marketing efforts and tactics. With that assumption, I’ve a gathered a handful of what I hope are helpful Social Media ROI measuring tips from sources around the web for your review.
As they say, “Eat the meat and throw away the bones”. Enjoy!
“Social ROI is an increase in conversation, an open line of communication between your customers, engagement with your potential fans, an increase in profits, a return sale, and/or new potential customers seeing a positive experience through your social channels.” – Social5150
“It’s the age-old question, and one that brands and marketing departments have struggled to answer for a decade now. And they’re still mystified: a new study reveals that just one third of executives are confident that they can accurately measure the effect of company social media use.” – Shea Bennett
— MB’s AllTw!tter (@alltwtr) August 19, 2014
“Having concrete goals and concrete baselines is crucial to calculating your return on investment. So before you set out to measure and monitor your social media returns, you need to have a clear idea of what it is you want to accomplish.” – Christina Warren
“Social Media ROI is an important topic, but we can’t use the same measures we used offline. That leads to false data.” – David Meerman Scott
“The main challenge in measuring ROI is keeping up with changes in algorithms, implementing the new tools that hit the marketplace and proving to your clients that they’re getting the most out of their investment in you.” – Debra Eckerling
— SocialMediaExaminer (@SMExaminer) March 26, 2014
“Understanding your real return on investment lies in understanding all the factors that go into each individual social media marketing campaign, how much money does it cost, how much time and effort will it take, and is it paying off? You can only know if you keep track of all these factors.” – Steve Cartwright
“Google Analytics is a great free tool for small businesses as it allows you to track how many visitors land at your main corporate website via your social media channels. You can also track how many of these visitors result in a conversion, whether this is a sale, a subscription to email marketing, or any other pre-defined action.” – Christian Arno
“The best way to measure the impact of specific campaigns would be to use custom urls for your ads/posts. This will enable you to drill down to the specific campaigns or posts in Google Analytics.” – Vaishali Singh
“The key to being a good marketer is testing. If you go on your assumptions, in many cases, you will be off. The only way you can figure out what’s working and what’s not is through testing.” – Neil Patel
“An important first step to tracking social ROI is linking your social efforts to your web analytics tools. With Google Analytics, the most popular of these tools, you can use UTM parameters to track sales conversions by channel, post type, or creative. Pulling in data from your CRM allows you to directly track revenue as well.” – Nate Joseph
— offerpop (@offerpop) July 10, 2014
BONUS VIDEO: We all like formulas, right? Here are many, if not all, of the formulas you need to calculate the ROI of your Social Media campaigns:
So what do you think? Have you got some helpful suggestions or ideas on this topic? Please share them below in the comments section. Your opinion is valuable to all.