For years, companies have been struggling to figure out how to quantify social media ROI — to put a number on a channel with so many moving parts.
Every company’s audience is on social media nowadays — and with trackable links and pixels, identifying which visits and conversions are attributable to social media is easier than ever. In fact, social media analytic tools allow you to easily map online conversations and locate your brand in them.
Even with these tools however, placing a value on social media ROI remains a big challenge for marketers. In fact, 86% of marketers polled identified measuring social media ROI as one of their top challenges for the coming year.
With social media activity happening simultaneously across multiple networks, and so many ways to interact with consumers online (comments, likes, shares…), it’s hard to know where to start.
So, let’s start with the basics. What is ROI?
ROI stands for return on investment, and it’s calculated via the following equation:
ROI = (benefits-costs)/costs
So for social media, ROI is what your company gets back from the resources (time, money) it specifically invests in social media.
So what’s the key to measuring your social ROI? First, it’s important to understand that social media ROI depends on your goals.
So, what’s your goal? We’ve identified eight common goals companies have on social media:
Now that you have this foundation on which to build, how can you determine your social ROI?
Start by choosing your goal. Then:
For teams using social media dashboards, like those in Tracx, making sure everyone who uses these tools understands these changes should be a top priority.
Brands that have not relied on organic reach in Facebook and Instagram will not likely see any changes this year. Those who do will need to take a serious look at other options.