These days, measuring return on investment (ROI) is not just a nice thing to have for justification of marketing spend, it’s an absolute must. Small businesses don’t usually have a lot of marketing dollars to spare, and that means investments must be shown to be actually working and adding value to the business.
Moreover, by tracking ROI, it becomes fairly obvious which aspects of social media marketing are working, which are not working, and which need tweaking in order to stay in sync with changing trends. This being the case, using tools which accurately measure social media ROI should be a crucial part of any marketer’s arsenal, and a very useful means of measuring performance.
Measuring social media ROI
There’s a very simple formula for calculating social media ROI, which amounts to subtracting investment from return, and dividing by social media percentage – but what if you don’t have these three numbers, and have no way of getting them? Then you cannot express ROI in terms of dollars, and you’ll have to measure it by some other standard, such as conversion rates, or your company’s reach, which includes likes, re-tweets, comments, etc. If you’re not measuring ROI in terms of dollars, you have to set some clear objective on just what it is you do want to measure, so you can determine if real growth is occurring, and you are truly getting ROI.
Ways to measure social media ROI
There are several ways you can measure social media ROI, and how you go about it should depend on what your business objectives are. If you’re trying to identify growth on your social media accounts, you need a tool that measures social audience reach. Engagement is a metric which can be measured by monitoring how many individuals are using or interacting with your social media accounts, as determined by likes, re-tweets, and comments.
Branding can be monitored by social media ROI tools which track the kind of mentions your company gets throughout the social media. Another very popular metric is conversion rate, because it is expressed as a monetary value, and is often accompanied by statistics on leads and general traffic numbers. Click-through rates are great for measuring the success of individual campaigns and for identifying the overall visibility of your brand.
Social media ROI tools
There are a number of excellent social media ROI tools on the market these days, and they each specialize in one or more specific components of social media presence.
HootSuite Analytics provides a wide variety of analytical tools such as Insights which helps you identify your company’s reach, branding strength, and industry buzz. Customized URL parameters help you track how much traffic was driven to your website by each of the social networks. HootSuite Reports provide quick snapshots of such metrics as follower growth, daily click-through numbers, and statistics per-post for whichever of the social media you want statistics for.
Salesforce helps you to track sales leads back to specific campaigns or marketing messages, and can be extremely effective when used in conjunction with marketing software like Marketo.
Google Analytics is excellent for tracking website traffic conversions on your website, and the sign-ups having their origins from some of your specific social media campaigns.
Follerwonk is a tool specifically geared to measure the impact of your company’s presence on Twitter, especially compared to your competitors. It does a great job of analyzing your followers across other social media networks, and breaks down statistics geographically and by other criteria.
For more insights into social media ROI, visit My Social Marketing Network at your convenience.