Social Media ROI: How To Calculate Social Media Marketing Return On Investment
What is social media ROI? Is it possible to measure your success with social media? In this MasterNewMedia guide you will find the best articles and reports to understand and calculate the return on investment from your social media campaigns.
Photo credit Kirsty Pargeter
Social media marketing campaigns are a completely different animal than any other marketing campaign. The main problem with social media is that you have no tangible elements to measure the return out of the initial investment you make.
If you spend money on advertising, you get money in return. But when you invest in social media, there is no money involved. Social media is free and you are dealing with non-tangible goods like human interactions and conversations, which are all resources that are not easily quantifiable.
Specifically there are three main types of resources you put to use when marketing with social media
- People The workforce you employ. It may be only you or your team.
- Technology The social media you use to accomplish your goals.
- Time The amount of the day you dedicate to social media marketing.
As you can see, it is very hard to state something like "I have four people working twice a week on Facebook, so I can expect to get "x" " There are no guarantees that the response you get from your audience will lead to the exact results you need.
Do not despair though, because with the appropriate strategy you can indeed attempt to make sense of your social media campaign and evaluate the results in the long run.
There is a five-step procedure you can follow to calculate whether your social media investment is producing relevant results
- Analyze Your first step is to understand your presence, limits and areas of improvements you have when using social media
- Plan Secondly, you need to establish a clear goal, something tangible you want to accomplish that is based on your analysis. Brand awareness, buzz, inbound links, you name it.
- Accomplish Third, you need to take action and employ the resources you possess to achieve the specific goal you have set.
- Evaluate Fourth, after some time spent on your campaign, you need to measure your performance to make sense of what went wrong (eventually) and what is leading you to the right direction.
- Repeat Finally, when you have achieved some good results, start over and focus your efforts on another goal.
It is indeed challenging to measure your social media ROI and, as stated before, nobody can assure you will get the results you expect. But social media has subverted the rules of marketing. Conversations are the way people want to be engaged these days and they are not willing to go back to the old days of institutional brochures or brands that do not listen to their customers.
If you want to be successful, you do need to jump on the social media bandwagon and this guide is a good place to understand how to leverage in a very practical way the power of social media for your own business needs.
Social Media ROI: How To Calculate Social Media Marketing Return On Investment
What Is Social Media ROI?
A Basic Introduction
This presentation by social media expert Olivier Blanchard is the very starting point to make sense and understand what is social media ROI and why it is very important that you leverage the power of social networking for your own business.
by Olivier Blanchard - Social Media R.O.I.
Social Media ROI In a Nutshell
If your goal is to participate in the conversation, to enhance your relationship with your audiences and become a trusted member of the community that surrounds your brand, then you should seriously think of social media ROI.
by Jason Falls - Social Media Explorer
Adam Cohen makes a short list of key thoughts and lessons learned after participating to a panel at the IBM Websphere Commerce Leadership Summit where many voices and perspectives gathered about the use of social media to measure how much you are successful with your business.
by Adam Cohen - AdamCohen.com
Social media expert Olivier Blanchard outlines the relationship between investments and outcomes made by social media marketers. The "return" you get out of your initial investment must be calculated in the same currency (money, impressions, clickthroughs, whatever) as the investment to really appreciate the progress you have made.
by Olivier Blanchard - The BrandBuilder
How To Calculate Social Media ROI?
For social media to fully work, businesses and brands need to be able to evaluate the impact their social media use is having, both positive and negative. Measuring social media ROI isn't impossible, but it can be difficult because many of the pieces that need to be evaluated are difficult to track.
by Christina Warren - Mashable
Is social media an extension of business ethics? Should there even be a "return"? How can you define the metrics that will measure a successful marketing campaign? Have a look at this insightful presentations from the guys at Egg Co.
by Matt Rhodes - Fresh Networks
The key with social media measurement is to stand back and take a widescreen approach to measurement. Rather than focusing on the smaller, campaign-specific metrics, such as traffic from Twitter or the number of fans on Facebook, it is better to look at how social media helps sales, profits, as well as customer retention and satisfaction rates?
by Chris Lake - Econsultancy
The main concept behind social media networking is that users can connect and communicate with each other. Usually a successful social media networking campaign isn't judged by the traffic sent, but by the relationships built.
by Greg Finn - Search Engine Land
Goals and Tips To Maximize Your Efficiency
When it comes to social media ROI, what you choose to measure is dependent on your goals, or what you want to receive as a return. If you're purely interested in building links, your costs and investment should be measured alongside how many links you receive.
by Maki - Dosh Dosh
Return on Investment (ROI) is a measure of a company's profitability, equal to a fiscal year's income divided by equity and long-term debt; and ROI measures how effectively the organization is using its resources to generate a financial profit.
by Urs E Gattiker - Social Media Today
Social Media ROI: Practical Examples
Socialnomics: Social Media ROI showcases that social media can help you achieve success on almost any front. While the video uses familiar nomenclature like ROI, many pieces of social media behave so differently than anything we have ever seen, that I prefer to use "What does or will success look like?" rather than "What's the ROI?"
by Erik Qualman - Socialnomics
One of the hardest things to do with blogs is to quantify the benefits, mainly because there's a blog for almost everything under the sun. Hence, measuring just traffic to a blog or the number of comments on a post means little unless the traffic or the comments are linked to value creation. This gets at the task of measuring intangibles - what does it mean for an additional visitor to come to the blog or contribute a comment?
by Charlene Li - Groundswell
Here's a look at five journalists who use social media, their attitudes and approaches to it, how they fit it into their schedules, and the ROI they got from it. Though this post focuses on journalists, many of their tips can be more broadly applied to anyone working with social media tools.
by Leah Betancourt - Mashable
Originally prepared by Daniele Bazzano for MasterNewMedia, and first published on December 21st, 2009 as "Social Media ROI: How To Calculate Social Media Marketing Return On Investment".
Daniele Bazzano -
A Basic Introduction - mbagdon
Social Media ROI In a Nutshell - AlexStar
Lessons Learned - Elena Aliaga
The Riddle Explained: Action - Reaction - Return - Ilona Baha
Guide To Understanding Your Success With Social Media - Valentin Mosichev
Is Return On Investment Really Measurable? - Leonid Nyshko
A Business Perspective - Elena Elisseeva
Stop Thinking Traffic, Think Relationships - Tomasz Dlugosz
Goals and Tips To Maximixe Your Efficiency - Yuri Arcurs
How To Measure Profitability and Avoid Common Pitfalls - fib_object
Facts and Figures - Video - Yong Hian Lim
How To Calculate Return On Investment For Your Blog - LoopAll
Why Journalists Should Use Social Media - igorr1
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