Social Media Marketing ROI

The social media community seems to struggle with talking about ROI. There ARE lots of vague notions about engagement and its value, but little conversation about actually measuring and assigning value.

I think the difficulty of the discussion is the lack of context from business specific reasons and value.  Where are the good hard case studies?  While outside social media folks will share anything, successful social media company insiders probably see their success as a competitive advantage.  They won’t share their numbers or methodology.

The ROI of social media depends on a business’s specific strategy.

What does the business sales strategy look like? Simple sale?  Considered sale? What are the business or organizations factors?  What will be of value?

From that, decide on your social media goals. Know what you want, tailored specifically to the benefit your organization can derive from it. What value do you intend to get?  What value do you intend to offer? Have a strategy to get it.

You can then measure, benchmark, and improve.  Maybe you’ll get new insight directly from customers and change business strategies.  That’s the ROI of social media.

Some possible measures:

  • SEO SEM integration- more natural views to your main site?
  • Engaged visitors- size of community
  • CRM integration and measures (Isn’t social media CRM?)
  • Blogs and activity
  • Facebook, Twitter, MySpace, Ning pages activity, other platforms.
  • Sales-leads, qualified, warm etc.
  • Brand measures-
  • Brand evangelists club participation.
  • Satisfaction measures-net promoter scores.
  • Ideas suggested-implemented
  • Complaints- complaints resolved
  • Compliments-congratulations
  • Case studies from conversations, success stories offered.
  • “Focus group” market insight.
  • Special community-only offer success
  • Forums and self-help/customer generated community help
  • Brand touch point integration
  • On-going and active conversations.  Positive-negative-neutral

And what does it all cost you?  It’s fairly simple math after that. It usually won’t be specific concrete dollars made. (Although it might be.) But you/we will measure value and be able to improve it.

And oh…what’s the ROI on your traditional advertising?

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