How to Measure the Value of Social Media
The power of social media should not be underestimated. It has the potential to rapidly grow brand awareness allowing individuals to reach massive global audiences and build a following. Marketers have understood this for a while but recently, executive level managers are also starting to see the potential of social media marketing. With growing interest in social media marketing from C-level managers comes more pressure to show an ROI. While we can speak about engagement in terms of likes, shares, comments and so on, executives tend to want to put a dollar figure on your audience and gain clarity around how social media is directly affecting the company’s bottom line.
Being able to demonstrate this clarity is crucial, particularly when it comes down to having future budgets approved for social media spend. So, let’s look out how we can translate engagement into something more tangible in terms of sales and profit.
Set the right expectations
The most important factor is to set the right expectations first. It isn’t always easy linking likes to conversions and sometimes your stakeholders need to understand that social media marketing is about the long-term. It’s about building brand awareness, trust, and establishing long-term relationships with potential future customers. Don’t allow yourself to get boxed in to committing to unrealistic sales figures because the world of social media marketing isn’t that granular. Instead, it’s best to highlight the objectives of what you want to achieve.
These can include: building brand awareness, generating leads for the sales team, collecting crucial feedback on the product and improving customer support. For example, you may want to highlight how engaging customers on Facebook has reduced the number of contacts to the call center contacts or, build a ‘voice of the customer’ report and show information about the sentiment of your customer base towards your product. All this is incredibly valuable to executive managers.
Choose your metrics carefully
To show ROI on your objectives you need to implement some metrics that can be quantified and measured. Some of the specific KPIs you might include are as follows.
How many leads has the campaign generated for the sales team? What improvement is this on the baseline prior to the social media campaign?
Based on the leads generated, how many are actually converting? You can then divide the cost of the campaign by the total number of leads or conversions to work out what you’re spending per prospect.
Response times to customer support inquiries
Just like the contact centers measure things like average handle time, you can measure response time to customer inquiries through social media. For example, how many issues were resolved within 30 minutes of customer contact.
Voice of the customer intel
Here, you can categorize customer comments into segments to provide feedback to the business. For example; product improvement, service experience, price etc. This way you can ensure that the right stakeholders are getting relevant and valuable feedback from your campaigns.
Incorporate website analytics
During your campaign, you want to be sure that you track how many website visitors it’s generating. For example, is your campaign leading to increased traffic and therefore more lead generation or not? The best way to do this is to use specific landing pages and links for each campaign. That way you can directly track the click-through rate and analyse customer behavior. If a landing page is only dedicated to a social media campaign, then you have all your data in an incubation and can directly speak to number of visitors, leads generated, time on site, conversion and more.
Experiment with different types of content
It’s important to think of each and every campaign you run as an opportunity to improve and make changes. It may be as simple as tweaking the advertising copy or using a different image or video. So, make sure you experiment and even run different versions of your ads at the same time to gauge which sort of approach generates the biggest ROI. You then use what you’ve learnt on your next campaign and so on so that you’re constantly improving the engagement of your marketing efforts.
Being able to demonstrate ROI on social media campaigns is easy if you’ve set the right expectations from the beginning. It’s about a balance of educating stakeholders that social media is about the long run and building relationships whilst at the same time, being able to quantify and measure crucial metrics and provide solid voice of the customer data back to the business. As long as you have a baseline and the right metrics in place, you should be able to sit back and watch the power of social media significantly improve business over time with measurable results.