Marketing campaigns that utilise social media can seem difficult to measure, particularly when it comes to return on investment.
The usual ROI formula takes into account just two factors – revenue and investment.
But with social media, there are often additional considerations that go beyond purely financial goals.
Social media can help improve things like customer satisfaction, brand recognition and employee retention. These intangible achievements can be measured, but you need to use the right tools.
Products such as Omiture, TweetMeme Analytics, Hootsuite and, most popular of all, Google Analytics can all be extremely useful. These tools allow you to track against your set goals by setting action points against them. For example, when someone buys an item from your website, clicks on an affiliate link, subscribes to your newsletter or when they click on your links in social media profiles – all these could be seen as actions helping you get closer to each of your ‘goals’.
You can then attribute goal values to different customer actions, such as clicking on a specific number of pages, watching a video, or using a discount code.
All this information can be used to give you data on where customers are coming from online and what they are doing when they get to you.
Once you have your data, you need to correlate it against sales, retention or customer satisfaction information – however you are measuring the campaign’s performance.
One must remember of course that social media isn’t just about increasing revenue.
When done correctly, it is the positive knock-on effect that enhances a brand’s image that can have a longer impact than some other forms of media.
A good comparison for how businesses need to look at social media marketing is corporate social responsibility (CSR). It is difficult to calculate the return on investment of CSR, but many companies view the money spent on these projects as important for the company’s bottom line.
Social media platforms build new relationships, create a buzz around your products or service and strengthen your brand. By tracking what really works for your business, you can ensure your social media campaigns are spot on.
What tips can you share on how to measure social media ROI?