Sir, I will get you 5000 likes for ‘too toe-sand rubees’! That’s the best ROI in Indian standards, sir!
– A ‘social media guru’ while wooing a client.
That client was me years back when I was stuck working with a marketing guy of an online startup, who expected me to show huge numbers on his employer’s fanpage to justify the social spends of the company.
Now that would make you think, ‘Is fan count/growth, the right metric to measure the success of a brand on Social media?’ Simply put, what is the Return On Investment? It is like the soul, you can feel it but just can’t see it!
But the question that should precede your questions on ROI is, ‘What is my business motive behind using social media?’ You might raise your hand to answer, ‘getting people to know my product and hence generating sales’.
Yep, in a simple world where people can just ‘like’ a post to give money to poor people in Africa, that is the perfect answer.
But we know that it just doesn’t work that way and so are social media ROI calculations.You would have understood by now it isn’t as simple as mapping your sales with Social media spends to determine the success of your campaigns and efforts.
This leads on to the next question, ‘How do I know if I am on the right track at least?’
What is to be tracked?
Rarely, the newbie social media agencies or startups talk about right Social Media ROI calculations. In most cases these “monthly reports” never look beyond the number of likes, fans or followers. ‘But why isn’t that a metric?’, you ask me. Well, Google “get 5000 likes on Facebook” and I have made my point.
The answer lies in setting targeted social media marketing objectives that matter to your business which makes it easier to track the performance and hence the results. Defining these key factors that determines the success rate your business will in-turn help you realize what is to be tracked and what is irrelevant.
Let’s talk about the most commonly discussed Reach, Engagement Ratios, Lead Generationand Conversions. The show stopper will be the eventual measurement of the Customer Acquisition Costs.
Making sense of the Reach:
Well, Tyrion Lannister may be an exception but not your social media community. It is essential to set the stage for a growing community, specifically an organically growing one. And hence you have to check for the:
Organic Growth Percent: Generally used to track and measure the successfulness of a social campaign be it a content lead campaign or an activity lead campaign such as your facebook contests and twitter contests. This is nothing but the ratio of your new fans/followers acquired over the period of the campaign to your overall fanbase that existed before the campaign (New fans acquired/Total number of fans existed before campaign).
Though the worth of an average facebook fan as estimated by the folks at Hotspex by a survey is 174$ it might mean 0$ for you unless he is relevant. Same applies for your 2.5$ worthy twitter follower.
Relevancy Ratio: Volume your entire social community as against the volume of your TG in the community (Actual TG who are fans/Total Fans). There are several tools to do this, though for FB you can just use the Ads manager to check these numbers.
Scope of View: TG volume in your community as against rest of the available unreached TG. (Total TG on your Fanbase/Total TG count across the platform) The numbers can be pulled from FB Ad manager again.
Influencer Growth Ratio: Number of people who can influence consumers of your business who are also a part of your community
Keep tracking the percentage growth of these numbers to make a sense your ongoing Social media strategy.
Engagement and the numbers behind:
I would urge you to look beyond the count of the numbers and likes that your social media intern quotes in the reports he makes. Experienced Digital Marketers use something called as the ‘Interaction Ratio’ for the content and ‘Click Through Rates’ for traffic.
Interaction Ratio: Ratio of people who have taken action on your content as against the people who actually saw it, i.e. the Reach (not talking about your entire fan base here, as a major chunk of your fans might have missed the post cos of several reasons ranging from not being online to that particular post considered lesser important according to FB’s Edgerank algorithm). Essentially is ([Like+Shares+Comments]/Reach)
Click Through Rates:Tracking how many people have engaged with your post and landed on your site through the link posted in specific content pieces. This can be done with trackable URL shortening tools like bitly.
Stories Created: This is nothing but the count of the conversations created about your brand across social platforms. Not just a tweet or a facebook post but includes essentials like reviews and recommendations across these platforms such as social forums and general web as such.
Tracking the Lead Generation and Conversion Ratios:
Website Referral: The number of visits to the website of your business through Social Media sites. This is essentially done through Google Analytics platform.
Though it is tough to find exact strategy to direct to a point of sale, tools such as plumb5, Adobe Target can track back the casual entry of a visitor to your site and map it with his fingerprint from social media to determine the user behavior based on your marketing strategy and web content.
Your final and ultimate step will be the Customer Acquisition Cost (CAC) calculation which essentially is the money spent across the social platforms divided by the customers acquired over a period of time. The lower your CACs mean the better performance of your social media marketing efforts.
Rounding up, measuring ROI of your Social Media Marketing efforts isn’t an easy task or a one time task either. But after all, what is the worth of your money and energy spent on the medium unless you know what you do is right for your business?
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