How to track Social Media ROI in 3 steps?

10 Feb
2018

1. Set up your Social Media Goals
2. Track and measure your goals
3. Calculate your Social Media ROI

1. Set up your Social Media Goals

Like I have been mentioning since the beginning of this article, setting goals comes first, tracking Social Media metrics comes next and measuring Social Media ROI comes last.

“Are you looking to increase revenue or build awareness of your brand?”

By understanding the right KPIs for your brand, it’s easy to understand the impact of your Social Media marketing efforts. For your campaign to be meaningful and clear, the big picture should be broken down into small sized goals which again should match your KPIs. For businesses looking to generate revenue via Social Media should measure Lead-gen and Sales metrics (I have discussed above) like product purchases, customer sign-ups or free trials.

At the same time, for businesses looking for brand awareness should measure consumption and sharing Social Media metrics like brand mentions, followers, reach and engagement on Social Media.

2. Track and measure your goals

Ultimately, the metrics you would track should be actionable. And that action should help users to move along the sales funnel and towards becoming a customer.

Think about a Social Media funnel where every section is linked to a metric, if any section of the funnel goes wrong then the corresponding metric can be analyzed and improved to keep the flow consistent.

There are thousands of tools out there on internet that can help you track and analyze your metrics efficiently.
Tools like Statusbrew Reporting, True Social Media metrics and Google Analytics can provide you with the clear insights of your Social Media activities you need to track.

If you have a website then your ability to retain and convert your audience depends on how informed you are about their behavior on your site.

One of the best ways to track your goals is to use Google Analytics (the most commonly used web analytics tool). Every single goal of yours can be measured if you adopt the right approach.
Google Analytics is a free tool that can be used to set up trackable goals and monitor how often a visitor complete the actions you define.

For creating and configuring goals on Google Analytics, you can read this tutorial.
Once you assign your goal, you need to add values to your KPIs by defining monetary value of these goals.

You can choose several ways to do that:
• Lifetime value: How much do you earn from each and every customer on average?
• Lifetime value multiplied by conversion rate: How much is each potential visit worth to you based on the percentage that converts?
• Average sale: How much is the average purchase through your site?
• PPC valuation: How much would you end up paying if you were to use ads to achieve the same Social Media results?

3. Calculate your Social Media ROI

In order to track your expenses you need to have an eye on what you’re spending exactly.
• Time – You invest a lot of time to research, create and share content on Social Media, keeping Social Media channels up-to-date and engage with your audience on Social Media.
• Design – When you create design like image, infographic or video for your content to look appealing in order attract audience, it comes into the investment part as well.
• Tools – You can invest in Social Media tools like Statusbrew, Hootsuite and Buffer to automate your Social Media scheduling, listening and reporting. It can save a lot of your time. Remember to calculate the ROI for the period of time you run the campaign. For example, if your campaign lasts for 2 months then don’t consider the tool expenses for the year.
• Money – You may also spend money in Social Media advertising like boosting posts on Facebook, promoting Tweets or sponsoring posts on LinkedIn.

All the above resources you are investing in your Social Media marketing should be considered while calculating your Return On Investment (ROI) in order to check the positive or negative ROI.

Once you are good with expenses, you can calculate the Social Media ROI for each and every campaign by this formula: “ROI = (Earnings – Costs) x 100 / Costs”

Earnings is the value you define while you set your goals and costs would be your expenses mentioned above (time, design, tools and money).

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