Are you new to social media or aren’t sure how to use Facebook and Twitter marketing to increase your sales? This post is for you.
Social media marketing ROI is a hot topic; everybody wants to know how social media is going to make their business money. And let’s face it, that’s a pretty fair question.
But first, let’s get back to basics. No matter what you’re measuring, whether it’s social media or something else, ROI is defined as the ratio of money gained or lost on an investment relative to the amount of money invested. Therefore, you have to set up some baseline metrics prior to measuring your social media results.
This means you’ll need to determine what it is that you want to measure. You can customize your campaign to accomplish a variety of goals including increased sales, better customer retention, increased coupon-redemption rates and so on. Then the work begins!
When you launch your campaign, the first results you’ll see are generally referred to as non-financial indicators and can include:
- Facebook friends
- Twitter followers
- Re-tweets
- Social mentions
- Increased site traffic
- Blog comments
- Positive press
- Positive word of mouth
While these indicators are a good sign that your business is growing because of social media, you’ll need to find a connection between these non-financial indicators and revenue generation in order to calculate ROI. For example, do customers on your social networks purchase products from your website more frequently than others? What percentage of your coupons have been redeemed as a result of social media? If your Twitter followers increased by X%, then how much did your total revenue increase? These questions drive ROI.
From an SEO perspective, one of our favorite metrics is to measure how site traffic increases because of social media and how this traffic ultimately results in increased revenue. This is simple to track through Google Analytics or other analytics software platforms that your SEO services provider may be using.
The thing to remember is that no matter what metrics you decide to measure and how you measure them, the key to measuring social media ROI is to identify how it helps your business generate revenue.
Tags: social media ROI
