Social media has become an integral part of digital marketing, but how can you measure your impact and determine if investing in it is paying off for your bottom line? Metrics are a means of determining an actual number value for your reach. There are several ways to go about determining that number, but they’re only valuable once you’ve answered a few questions about your brand and social media.
Start by determining your goal: why are you using social media? As Carol Morgan, managing partner of mRELEVANCE, discusses in her bestselling book Social Media 3.0: It’s Easier Than You Think, some common goals to set for your social media use include: increasing website traffic, social media optimization, reputation management , social networking, building your brand and sales. After setting your goals, it’s time to determine your objectives: what do you want to accomplish? These are your key perfomance indicators (KPI). Now you’re ready to determine your tactics, or how you’re going to accomplish your objectives to reach or surpass your goal. That’s where metrics figure in.
When it comes to social media, getting to an actual return on investment (ROI) can be hard. Try not to tie an arbitrary sales number to social media. Ask, is this a good investment? Is this a good investment related to our other options? Provided below are several methods discussed at PubCon 2014 to determine ROI.
Method 1 – Focus on Your Reach (similar approach to mass media)
– Assign a reasonable Cost per Impression (CPM) rate to social impressions
– Reach * CPM rate
– Industry rates: $8/CPM for organic / paid and $24 CPM or earned/viral
Method 2 – Assign a Value to Things You Can Measure
– XX qualified online social leads
– XX leads to customer conversion
Method 3 – Assign Sales Lift Value to Impressions
Method 4 – Use of Backward Logic
– How many new customers would we have to get for this to pay out?
– Does it seem likely that we are getting at least that?
– For example, we spend $1000 on social media per month, and a new customer is worth $50 (or X) to us. So we need 20 new customers a month from social media
– Social network referrals
– Set up conversion tracking
– Check conversion paths
– Monitor email address signups
At mRELEVANCE we measure social media several ways. Here are just a few things to consider when reviewing your social media each month:
1. How is the traffic performing on the individual site (such as Facebook)? How many likes, shares, comments? What is the overall engagement?
2. How many friends, fans or followers does your company have and are these numbers growing incrementally each month?
3. How much traffic came from social media to the website? Look at this month versus last month and this month versus the same month last year.
4. How much traffic came from the social media sites and completed a ‘contact us’ form? We count these as conversions.
Make sure to review any campaigns or promotions on a monthly or weekly base as well. The great thing about social media is that you can make adjustments along the way to improve interactions. To read more from this series, click here.