Do you love social media? Are you struggling to prove its ROI to your boss? Well, you’ve come to the right place! There are many benefits of utilizing social media as a part of your marketing mix but, it’s crucial to have a clear purpose for your business’s social media marketing.
One of the biggest challenges surrounding social media within an organization is proving your return on investment (ROI) because social media can be used for a variety of non-monetary goals. You may reach many of the millions of active users across social media platforms every day, but how can you translate your social media efforts directly into financial results?
Oh, you don’t know how? Trust me, you’re not alone. Let’s take a look at 5 steps that will help you get closer to proving your success.
KPIs are values you can measure to determine how effectively you’re achieving your business objectives over time. Social media is different from other marketing efforts because you can’t determine its success by looking at revenue alone. To determine which KPIs to measure, you need to determine what outcomes you are looking for and whether you have access to data reflecting those outcomes.
Choose KPIs that can examine results that are valuable to your company. Valuable results could include engagement and positive online reviews.
Some of the most important KPIs are:
Take a look at this graphic from Hootsuite that shows you how common KPIs are calculated. You can read the full article here to learn more!
In order to show value, your KPIs and social media goals must be aligned with your overarching business objectives. A lot of businesses look at social media in isolation, but this is misguided. Take a look at your company’s business objectives and decide which of them social media can help you achieve. For example,
Make sure the goals you set are specific, measurable, attainable, relevant, and timely (SMART). Set targets for improvement based upon past performance. That way you can show your boss how awesome social media marketing is!
Now determine which social media platform is going to help you reach your ideal clients/buyers and best fits your style.
Create a list of tasks you’re going to complete in order to reach your goals (be sure to include the frequency at which each task will be completed) and finalize your action plan.
Listen up now… this is important: Be sure to complete your tasks on a CONSISTENT basis and track how long each task takes you. Your tasks should take less time as they become more routine. You’ll use this information to help modify your plan and tie your use of time and resources back to your ROI.
Now the fun part. Start tracking the plan you’ve put in place and measure the outcome. Then prove to your boss just how GREAT social media marketing is for the company!
Many social media platforms you use will have a way to track your metrics right within the platform, but additional tools and ways to track more information are available.
Utilizing third-party tools like HubSpot, Databox, and Google Analytics can also help you track your social media ROI. Some of these platforms even automate the tracking for you and produce custom reports. And we all love automations.
Okay, last one…
Now that you have your KPIs, goals, action plan, and tracking in place, it’s time to assign a dollar amount to each KPI. How much is each KPI worth to your business? How much would you pay for every new lead, follower, click, etc.?
Depending on your overall business objectives, you may value certain KPIs differently. If your business goal is to increase brand awareness, for example, you may value engagement and impressions more highly than a download. To estimate the monetary value of each social media post, use this calculator.
When you’re looking at your company’s investment into social media, look at your time, tools, and spend:
Once you determine the value of your social media goals and the time and resources your company has spent, you can finally calculate your ROI.
Social Media ROI = [(SM return – SM investment) / SM investment] x 100
Understanding the success of your social media marketing doesn’t have to be the elephant in the room. Just remember: choose the right KPIs to monitor, align your SMART goals with business objectives, and put an action plan in place that you can measure with the right tools.
Test, test, test! You’re not going to put the perfect plan in place right off the bat. Analyze the data and optimize your plan over and over again. Eventually, you’ll be able to spend your budget in the areas that you receive the best results. Just like everything else in marketing, social media is always evolving, so make sure your strategy also reflects that.
Your social media ROI can be valuable for your company and give you insights to use in other areas of your marketing. Remember, there is always more to test and always more to learn. Now put your head up and go get your posting on!
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