As a Social Media Consultant, how to determine the ROI of Social Media is the #1 question that I get asked, from large, industry leading companies to small companies. As a matter of fact, how to determine the ROI of social media is a topic of debate and contention, amongst business owners and marketers alike. When asked this question, my answer is a resounding YES. You can determine the ROI of your companies’ social media marketing efforts and here is how:
- Invest in a Social Media Management Platform. Assuming your brand is set up in some or all of the top social media communities such as Facebook, LinkedIn, Google+, Twitter, Pinterest and Tumblr, you need to be measuring, monitoring and calculating your marketing efforts. This is the first step in understanding and determining the ROI of social. However, you need to take it a step further and understand how to analyze, interpret and report on data to senior management at your company. Data doesn’t lie and with Senior Management at any company, being able to understand and interpret data while presenting will gain buy-in to your efforts. Otherwise, you’re wasting your time.
- Social Media Management Software Varies Widely in Price. For big brands, my favorites are Hubspot, Radian6 and Webtrends. These platforms are costly, so it only makes sense if your brand has a significant social media presence, CRM system and budget to support. One of the key reasons why I love these platforms is the integration with your CRM platform. On the lower end of price, I recommend Hootsuite. Hootsuite is awesome! I recommend signing up for the Pro plan instead of the free plan, which is $9.95/month and includes advanced analytics, apps and more social communities. Investing in the right Social Media Management platform for your company is critical to understanding the ROI of Social Media.
- Understand How to Set-up, Analyze and Communicate Data with Google Analytics. Google Analytics has overhauled their platform, integrating social monitoring into the mix. Here is an example, let’s say you are conducting a Facebook Advertising campaign and you decide to do an A/B split. You set-up and run an advertising campaign with half of your budget to increase your Facebook “likes” and the other half to a landing page that you’ve set up on your website, specifically for this campaign. Within your Google Analytics you can set up the Facebook campaign so you can measure and determine the ROI of the Like campaign vs. your websites’ landing page campaign, as well as the lifecycle of site visitors after they leave your landing page and the time spent on your website.
- Utilize your Social Media Insights and Reporting analytics. For the above example, Facebook has improved their Page Insights tool, to provide you with a deep understanding of the demographics that make up your target audience, fan base, “reach” and other statistics.
- Set-up and Implement KPIs (Key Performance Indicators) and Benchmarks. These should be set-up at the beginning of your campaigns, so you can analyze the before, during and after of your social media efforts. KPIs should clearly link to the strategic objectives of your overall marketing strategy and therefore help monitor the campaign execution. Think of benchmarks as incremental goals that you aim to meet during your marketing campaigns. A benchmark example can be increasing your fan base by 10% or increasing your email newsletter signups by 15%, over a specific time period. If you don’t set up KPIs and benchmarks at the beginning of your social marketing efforts, you won’t be able to measure and support the time that you are spending in the social media stratosphere to your manager. Time is part of the ROI equation.
- Engaging Your Customers Across Multiple platforms Infuses Your Brand and Products into Your Potential Customer’s Life on a Regular Basis. Regularity leads to familiarity and therefore, comfort with a brand, product, or idea. Managed properly, this will drive lead generation, conversions, sales and ROI. A comprehensive strategy with a clear purpose will do just that. Moreover, by using the same branding message across multiple channels, you can create a more interactive experience for the consumer.
- Funnel Everything Said About your Brand Into One Message Directed at the Appropriate Audience Demographic for Your Company. Depending on your style of campaign, you might not have the diversity in customers you were going for originally with a campaign spread across multiple advertising mediums, but your ROI will be greater, and your business will grow more efficiently into additional markets. And after all, isn’t growing your business what it is all about?
- Using the Above Techniques as well as the standard ROI equation calculation, you will be able to understand, interpret and communicate the ROI of your social marketing efforts.
Social Media Has Captured the World by Storm. Social Media Marketing can be incredibly effective if properly managed; even more so than traditional marketing efforts. However, it takes time, a thoughtful strategy and plan.
Don’t Worry About Being Behind the Curve in Understanding the Massive Value of Social Media. According to a recent post by Inc.com, mid-sized businesses are suffering in the social media gap. I.e., they are not integrating social media into their marketing strategies, nor do they have a well-thought out plan for how to engage, drive lead generation and sales through the social media stratosphere. The various data this article discusses indicates that you and your company have about a three-year window to get ahead of your rivals in social media.
So what are you waiting for? Let’s get your business started! Contact Grow Social Marketing today.