Social Media ROI used to be the thing, darling. Marketers were obsessed with proving return on investment, but the necessary technology tools didn’t exist yet. So, we all moved on to more promising ways to prove our worth and forgot all about social media ROI.
Today, social media ROI is finally within reach. New tools with integrations points make social ROI possible, as long as you have clear objectives and expectations.
To help you with that, we’ve created this useful Social Media ROI Template to guide you through the social jungle. In this template, you’ll find tabs for calculating your social media ROI based on different goals. This template will help you measure your efforts and communicate their value.
Ready to go? Let’s get started with these five easy steps:
First things first, you need to define your social media goals and what you are measuring ROI against. We’ve given you the following six objectives to choose from: Lead Generation, Customer Acquisition, Individual Sales, Brand Awareness, Audience Building, and Talent Acquisition. Here are some great goal-setting strategies to help you get started, via HubSpot.
Next, you want to decide which metrics to track. All metrics should be linked directly to your chosen goal. In the below template, we gave you six different objectives to choose from, but don’t let those limit you.
Once you’ve decided which metrics to track, make sure you can track them with the right tool. Use link tracking and social attribution to approximate the kind of closed-loop reporting that enables ROI reporting. You want to know your tool is able to find and track all the information you are looking for.
Now, let’s assign monetary values to the “Benefits” in green. This will look different on every tab, but for now, we are going to work in the Lead Generation tab. Enter in how many leads you are getting via each social channel. Then, you are going to want to plug in your cost per lead, which is an advertising metric.
(Are you struggling to calculate your cost per lead? That’s okay! We’ve included a formula to help you out in gray below the ROI calculation.)
Do the same for the “Costs” section in orange. Add up the labor costs and advertising fees associated with your campaign by social media channel.
You can use this formula or check the box in pink to find out your ROI.
Traditionally, “return on investment” was a way to prove the value of a one-time investment. This makes social media ROI tricky, because social media is not a one-time investment.Social media is not a one-time investment. Click To Tweet
Goal-driven ROI helps us to zero in on what is important, but that doesn’t mean social media only serves one goal at a time. Don’t forget to also look at your program as a whole and calculate any extra benefits you might be missing. ROI is just a starting point. You might find you are achieving something you weren’t even trying to achieve.
At its core, social media is about building relationships. It’s important to keep ROI in its place as a helpful business metric, but don’t let it keep your team from exploring new, uncharted territory. Always be innovating!
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