The question: “How do I Measure ROI” continues to be the most common question I get. Measuring return on investment in the social media world is not impossible but unfortunately there is no one simple answer, no common calculation that will provide the right answer. However, it is not impossible to measure. My suggestion is to start from square one and understand what you are doing, why you are doing it and what expectations your organization has. Here are ten things every organization should do before asking the question: “How do I Measure ROI”
1- Answer the WHY:
Why is your organization on social media platforms? What is it that your organization is hoping to get out of it’s participation? Do you want to build online reputation, improve customer service, build awareness, increase sales or are you there simply because your competition is and you don’t want to be left behind? Are there several outcomes you’re hoping to achieve? If you do not have a clear understanding of why your organization is building a presence on social platforms you can’t begin to measure the ROI. Take time to write down why you are on each platform, what you hope to get out of your presence and what you will do when you achieve that goal(s). The more specific your goals the better results you will have.
2- Define Investment:
Having a very clear and defined list of investments is essential to measuring ROI. Investment can include such things as man hours, budget, product etc…. Social media marketing is complicated and many different things go into making it run. Be sure to understand what resources your organization is investing.
3- Track Investment:
Once you know what you are investing keep track of how much of those resources you’re expending. Make sure those individuals working on projects provide you with the exact number of hours they work (many social media folks work extra hours from home).
4- Track Results:
It’s probably best to consider tracking individual campaigns in addition to over-all efforts. This will allow you to track short and long term. If you don’t track results from the start it will be difficult to measure both individual campaigns and long term results.
5- Make Adjustments:
As you’re tracking don’t be afraid to make adjustments in order to improve your ROI. If a campaign eats up a lot of resources but your results are minimal make the necessary changes for the next time. Again, if you don’t have a clear goal set from the start making the right adjustments will be very difficult. Stay away from broad goals like – improve engagement. Define what “improve engagement” means.
6- Ask for Feedback:
You may be reaching more people through your social efforts than you think. Just because someone doesn’t click the “Like” button, leave a comment or share your post does not mean they haven’t had a positive or negative reaction. A person may have seen a post on your Facebook Page and found it offensive then posted something about your organization on their wall (without tagging you). Unless you are Superwoman or man you aren’t going to be able to read everyone’s wall everyday. This means there are results from your efforts you may never know about. Try asking people for feedback instead of just expecting them to give it. Ask the social world what they think of your efforts, campaign etc…. Ask what things they would like to see your organization post, share and the types of contests they would participate in.
Being able to receive feedback directly from consumers is one of the most powerful tools social media marketing has to offer. Far too many organizations skip over this, don’t be one of them!
7- Pay Attention
If you’re wondering how many people make purchases, come into locations or submit reviews because of your social media efforts you’re going to have to pay attention. Ask people why they are coming into your store, what motivated them? What inspires an individual to write a review or buy a particular product? The only way you will have the answers is by asking the right questions and paying close attention.
8- Change as you Grow
While you may start out measuring one thing, “Likes” for instance, as your social presence grows and you become a bit more savvy the decision to start measuring something more specific than likes may hit you. This is absolutely normal and you should always be making adjustments. The more you know the more granular your measurements will become.
9 – Invest in a GREAT Social Media Monitoring System
In order to track lots of data all at once it will become necessary to invest in a social media monitoring system (SMMS). What works for one organization may not be a good fit for another. As you begin figuring out what you’re measuring, why you’re measuring it and how effective your efforts are you’ll start to see what features you’ll need in a SMMS. While it may seem backwards I suggest picking, and investing your time and money into, a SMMS a little later in the game. Do your research and find what works for your, your team and organization.
10- Create your ROI Plan
Now that you are armed with information, understand why you’re on various platforms, what you should be measuring, what those measurements mean etc… you can now start defining exactly how your organization should begin figuring out the “ROI question”
If you want to learn more about social media marketing, analytics, measuring ROI and how to make social media marketing a powerful tool for you and your organization consider attending one of our Social Media Strategies Summits and/or Conferences