Social Media ROI (Return On Investment) is the phrase everyone dreads. It’s supposed to help you measure and account for the value you create with your work, but Social Media ROI is hard to measure because it’s difficult to tie social media efforts directly to business results. After all, social media is a means of getting the result, rather than the result itself. The benefits of social media are obvious for all to see – word-of-mouth marketing, brand equity, real-time customer feedback and commentary, crisis management, increased promotion and awareness – but companies want to know that social media is a good investment of their time and money.
Here are a few steps to help you measure your Company’s Social Media ROI:
1. Decide how much you are going to spend both financially and time wise – remember your time costs money! If you spend £50 a month on social media resources and you put in three hours a week at £100 per hour then your monthly spend is £1,250.
2. Keep in touch with your customers and realise their potential value. Give your customers incentives to share your brand – you need them to help you spread the word! Social media is a great tool for doing this. If one of your customers tells 10 people about your product, service or Company, you will hopefully get more clients as a result.
3. The PR sector has traditionally measured its impact by the cost of buying advertising against the number of column inches gained. A similar approach can be applied to social media. The more a brand message is shared on Facebook, Twitter or YouTube the greater the ROI. This can be compared to the cost of getting the same amount of coverage through online advertising.
4. Split up your social media coverage into sections to help glean how your customers engage with your brand. For example, are customers viewing a post (post impressions) or are they viewing a page (page impressions)? Do your customers look at photos, videos or links associated with your Company (personal actions)? Do they share this content with their network (public actions)?
5. Work out your conversion rates. Using Google Analytics you can track conversion rates so you can see when a customer decides to buy from, or contact, you.
6. Lastly, work out which social media device is most beneficial to your business and concentrate on pushing that. Are customers following you on Facebook or do they prefer Twitter?
By following these simple steps it should help you to work out your business’ Social Media ROI so that you can avoid looking like a deer caught in the headlights.