The 5-Step Social Media ROI Workout
I visited a friend's cupcake stand at a farmer's market last week. Shocked to find herself sold out of nearly everything, she confided: "It's terrible to say this, but I think this is about the time people start giving up on their New Year's resolutions."
Ah, weight loss goals. Of course we all know the right way, the healthy way to get there. But, honestly? That way is really slow and generally lacking in awesome cupcake gratification. It's so tempting to look for a quick fix, silver bullet solution instead – and then fall back into the same old patterns when those unattainable goals fall apart. It's easy to fail when you don't define success.
The same is true with social media. There are plenty of quick metrics that can make us feel good about our performance – heck, a million Facebook fans might still feel great even if you bought them. And there are a ton of tools ready and waiting to whip up a pretty chart of our social media performance.
But an easy, one-size fits all solution is never going to be the best one to measure your unique brand's social media ROI. Just like in fitness, you're not going to get there without a little work. In fact, 58% of marketers say measuring ROI is their top social marketing challenge for 2012.
Challenging? Yes. Impossible? No. Ready to get a healthy social media ROI? Here's my five-step workout.
Step 1: Understand your business' goals
Luckily, it doesn't have to be that hard. The best areas for you to focus on are most likely right in front of you in the form of your brand's current business goals.
Are you breaking into a new vertical? Launching a new product or campaign? Trying to increase traffic to your blog for the month? Looking to lower support calls, time and cost? Whatever the goals, chances are social media efforts can play a role in achieving them. Start here and begin to focus on the areas in which you can have a true impact.
Step 2: Align social media to your goals
Now that you know what your business goals are, the next step is to align your social media firepower with those goals. How can social media get you to your goal, and what channels and strategies will you choose to make the push? For instance:
- If your brand wants to focus on reputation management, then your focus might be social media monitoring for sentiment, brand loyalty and share of voice.
- If the goal is pushing out promotional campaigns and special sales, then you'll want to focus on click-through rate, conversions and sales.
- If it's customer service your company is interested in, your social media marching orders might include answering questions, gathering product suggestions and creating content that answers frequently asked questions.
Step 3: Measure success
On to the big guns: Measurement.
If you're focusing on number of likes and follows because they're truly the best metric for you, that's fine. If you're focusing on them because they're the easiest number readily available, we can work on that.
It may take a little creative thinking, but there is a way to measure almost every social media goal. These numbers may not line up with the traditional (gains-costs)/costs definition of ROI, but they can satisfy the spirit of ROI: justifying the investment your company is making in social media, whether that's an employee's salary and time or an actual social media budget.
From our examples above, measurement might look like this.
- For social media monitoring, measure sentiment in terms of volume, mentions of your brand's unique value add, number of positive reviews, number of brand advocates and share of voice.
- For sales, measure leads generated or nurtured through social media, traffic from social media and conversion assists (you'll need a little help from Google Analytics' Multi-Channel Funnels on that one).
- For customer service and product development, measure questions answered, product suggestions fielded and reduction in support costs and time.
Step 4: Break it down
Since we're bring a little liberal with our definition of "ROI" it's important to make sure everyone is on the same page. That's why I'm a fan of breaking down metrics to specific, realistic chunks we can all agree on.
Focusing on the ROI of a specific campaign with a finite beginning and end is a great place to start. If you can't do that, try to break it down to a time period – week over week, month over month, whatever works for your business. Then to the level of channel by channel and finally even down to the level of each post (campaign variables are a great way to get insights there.)
"What's the ROI of social media?" is a huge question. How much traffic did your lunchtime Facebook post bring back to your website? That's a much more reasonable question that begins to accomplish the same goal.
Step 5: Put tools to work for you (not the other way around)
Now that you've done all this work, don't lose focus. There are tools out there to measure all kinds of metrics, but you don’t need to measure EVERYTHING.
You've already honed in on the goals, KPIs and metrics you need. Now go out and find the tool or combination of tools that will do the job you're looking for.
How do you measure social media ROI? Let me know in the comments!
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