Measuring social media ROI is critical to any social media manager’s job. It allows you to understand your work’s effectiveness better, demonstrates value to the organization, and refine your strategy over time to improve returns as you learn.
What Is Social Media ROI?
ROI stands for return on investment; hence social media ROI refers to the return on investment from your social media activities and expenses. Social media ROI measures all social media actions that create value, divided by your investment to achieve those actions. Essentially, revenue is the ultimate indicator of social media marketing success. While determining your social media ROI, it is vital to use leading indicators of success, such as the following;
- Sign-ups for email, webinars, and events
- Product downloads and trials
- Purchases
- Visit-to-lead conversion rate
- Website Traffic
- Reach and Engagement
- Campaign results
Understanding and effectively communicating social ROI can also help you grow your social budget and expand your strategy. It is easier to justify spending money on methods that provide more value than they cost.
How To Measure Social Media ROI
How you calculate social media ROI depends on your organization’s objectives, i.e., brand awareness, revenue, and customer satisfaction, to mention a few, and this is how you go about it;
1. Calculate how much you spend on social media
To determine how much you spend, count the total profit generated from social media campaigns and the costs you’ve paid. Your social media costs might include;
- The cost of tools and platforms for managing your social
- The budget allocated to social ads spends
- Content creation: In-house and external content creation costs, including working with creators and freelancers
- Agencies and consultants
2. Define clear objectives that connect to overall business goals
To get to the type of ROI you need, you must know what you want to achieve. For instance, your social media campaign can primarily increase your number of followers, eventually leading to monetary value. You may want to know how many of your customers;
- Subscribe, like, share or follow
- Click on links
- Make a purchase
- Fill out a form
- Spend time on your page
Ultimately, straightforward social media objectives help define how social actions align with business and departmental goals and achieve real social media ROI.
3. Track metrics that align with your objectives
All social media metrics can tell you something about whether you’re achieving objectives and meeting your goals. But tracking the right metric is essential to understanding your social ROI fully. Metrics you can follow to prove ROI include:
- Reach
- Audience engagement
- Site traffic
- Leads generated
- Sign-ups and conversions
- Revenue generated
The Takeaway
To Measure Social Media ROI of paid social media efforts may be more of an exact science compared to organic campaigns. However, it’s essential to quantify the value of your brand’s presence on social channels for any movement. Social media is a powerful tool, but reaping what it has sown may not be as straightforward. For this reason, to see if your efforts are paying off, you need to continuously calculate your social media ROI for your organization’s future growth and development.
Frequently Asked Questions
What do creative agencies in Kenya do?
Well, creative agencies are more like digital marketing agencies. Their work is to ensure that you have a captivating story resonating with your products or services. Creative agencies come up with a strategy that shows you how they intend to market you. They come up with graphics, captions, and videos that sell your services. Do you need a creative agency to help you increase the visibility of your products? Give Charleson a call, they are a well-known creative agency not only in Kenya but across the globe.
