Measuring ROI is critical to any social media manager’s job. It gives you the liberty to understand your work’s effectiveness, demonstrate the organization’s value and refine your strategy to improve the returns as you learn.
What is Social Media ROI?
ROI is the return on investment, and you get a return on investment from your social media expenses and activities. The social media ROI measures all the social media actions which create value, divided by the investment you have made to accomplish those actions. Your ROI should be more than zero; a negative ROI means that your investment was more significant than the value it generated.
Measuring social media ROI matters a lot as it is critical to building and refining your social media strategy. It also shows what is working and what is not. It allows you to shift the resources and tactics to be more effective. Social media ROI is changing fast, and understanding and effectively communicating social ROI helps you grow your budget and expand your strategy.
How to Measure the Social Media ROI for Business?
How you calculate ROI depends on the objectives of your organization. Engagement is valuable as brand awareness is the top content goal, and the value is in the brand awareness that is gained instead of the sales or revenue.
You can measure ROI using the following steps-
Calculate how much you spend on social media.
- The total cost of tools and the platforms for managing social media.
- The total budget is allocated to social ad spending.
- The in-house and external content creation costs include working with creators and freelancers.
- The price for your social media team.
- Consultancies if you make use of them.
1. Define clear social objectives which connect to the overall business goals
Clear social media objectives also help define how the social actions align with the departmental goals and business. Without these goals, you cannot measure the ROI of your social media marketing. The social ROI is only achieved when you show how the social returns connect to the bigger picture. Following are some ways your social media investment might create value, such as-
- Lead generation.
- Brand awareness.
- Customer experience.
- Job satisfaction.
- Employee trust.
- Partner and supplier confidence.
- Risk mitigation.
According to a recent survey, social ads are integrated with other marketing activities, and the top goal for the brands is measuring the social ROI and expanding the social impact onto other departments.
2. Track metrics that align with your objectives
All social media metrics will tell you whether you are achieving your objectives and meeting your goals. However, tracking the right metrics is crucial to fully understand your social ROI.
Following are the metrics to improve your ROI-
- Audience engagement
- Site traffic
- The leads generated
- Revenue generated
3. Create an ROI report to show the impact of social media
Once you have the data handy, you should share the results with the right stakeholders for showing how social media marketing affects the organization’s bottom line. Following are some ways to make your report stand out-
- Make use of a template.
- Avoid making use of jargon.
- Tie the results back to the relevant business objectives.
- Make use of KPIs for tracking short-term progress.
- Be clear about what you can measure.
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Following are some more effective ways of increasing the social media ROI-
Test and optimize
If you are running social ads, you should experiment with different types of audience segments and ad formats which will expand your customer base. You should also experiment to see what delivers the best results. As you report the social media marketing ROI, you ought to clarify what you are trying to encapsulate and how those lessons make a difference.
Make sharing third-party content a crucial part of your strategy
Many businesses make one common mistake of focusing exclusively on self-promotion. Your followers have an eye for detail, and when they are experiencing the variety, they will get bored and turned off by a self-centred newsfeed. The first step in keeping them engaged is being as pleasant as possible. Content Curation will help you build a loyal base audience, and it will also help you connect with some of the most prominent leaders in your industry.
Make use of your social media scheduling tool
Scheduling your content allows you to do the following essential things-
- Organize your content in advance, and do not struggle last minute.
- Try reaching your target audience at optimal times.
There is a lot of content out there, and social media feeds move very fast. You should ensure that your social media posts are only going out when your target demographic is likely to be active.
Boost your content with social media ads
The best thing about social media advertising is, it helps you target particular audiences. Before you set your advertisement, you should make sure that you think carefully about who you want your content to see. You should be more specific as the more specific you are, the easier you make it for the social media sites to place the content in a more organized manner.
There is one remarkable feature of Facebook ads it lets you retarget audiences which have already shown interest. Once you have generated traffic from the boosted content, one more extra step is to retarget that traffic with a special offer. A promotional feature will help you convert the new traffic into loyal customers.
Use video content to get more engagement
Video content is very popular on social media right now, and video posts are generating three times more monthly visitors than websites that only post texts. The video content you post should be highly relevant and interesting to your target audience.
Use branded links for third-party content
A number of tools allow you to add your own brand to third-party content you have shared. You can do that by using one of the tools as a URL shortener and showing your brand in a small overlay once the user clicks.