If you’ve ever used Social Media as a means of marketing your business, you have probably been wondering just how to tell if it’s paying off for you, how to tell if you are getting any ROI (return on investment) for all your efforts. This can be a tricky thing to do. The main problem with social media marketing is that there is no clear-cut, common way to measure brand outcomes across the social media platforms board simultaneously. This has led to social media effectiveness being measured in a sketchy way at best, or not at all in some cases. But measuring your social media ROI is very important, as it allows you to see where your can improve your efforts, see which social media channels are working best to bring in revenue, and how specific changes impact your goals.
So what is one to do? How does one align their social media efforts with their business goals? How can they measure the success of their social media marketing?
To effectively monitor your social media ROI, your social media marketing should have been set up from the start to be able to gather data so you can measure your ROI. And the best way to do that is to design ways to define and measure specific customer behavior. This means you need to first set some goals for your campaigns. These goals need to be something quantifiable (that you can attach a number to) for easy tracking and measuring. These can be things like e-mail list sign-ups, contact form inquiries, purchases, or downloads of an e-book. Social media shares and follows are nice to track, too, but they shouldn’t be your focus. You want your main goals to be based on actions that convert a casual browser to a lead, and ultimately to a purchaser. Once you have your goals defined, you need to link them to specific campaigns. Campaigns are planned efforts with a set goal and a measurable outcome.
Once you’ve set your goals, you need to track them. This part is why setting up goals based on visitors taking action. The easiest way to keep track of your social media goals is by using Google Analytics. It has options within it to let you set your social conversion goals so it can track it for you. The main things you want to see when tracking metrics is: which sites sent referrals, which promotions are attracting the most activity, and what actions are being taken on each landing page.
If you want to really see whether your social media marketing is providing a positive or negative ROI, you will also want to keep track of your social media expenses. These include your man-hours, costs for content (did you hire a professional copywriter or outsource status updates?), social media tools you paid for, and costs for ads. Once you have that figured, you can calculate your ROI for each campaign with a simple formula:
Once you’ve got that calculated, you can review your results, checking the results against your goals and see what worked and what didn’t, and then reset your goals based on those results. If you’re making a positive ROI with some campaigns, keep doing those sorts of campaigns. If a campaign is not working, stop using it and either try something different or see if you can modify it so that it works.
There are a lot of tools available to help you with your social media campaigns. A few good ones are:
*Google Analytics – for tracking campaigns and goals
*Google URL Builder – for assigning trackable links for your campaigns
*Sprout Social – for scheduling social media posts
*Customer LTV Calculator – for calculating the LTV (lifetime value) of your customers
Other good tools include Hootsuite, KISSmetric, Buffer, and Moz.