High social media ROI, or return on investment, is a great indication of a successful online marketing strategy. To secure long-term investment and budget for your social marketing strategies, you have to clearly exhibit how your efforts are contributing to your business’ goals.
Other than proving its impact on your company, measuring and tracking ROI enables marketers to dedicate more time and resources into the most effective tactics and further develop strategies that are not working.
Our team at Maxeemize have created a list of things that you need to know to measure your social media ROI.
What is Social Media ROI?
It is a calculation that shows how much value you produce with your social media ventures. This is typically a sum of money, but some companies see ROI as a non-monetary value like signups or comments. The exact meaning of social media ROI totally depends on your business goals.
Why Measure Your Social Media ROI?
There are various reasons why measuring this should be one of the top priorities in your business. Measuring and tracking your social media revenue can help you:
- Show that your social media strategies are working
- Demonstrate its value to your business
- Identify areas that are most effective
- Pinpoint tactics that aren’t working
- Maintain social media budget needs
How to Calculate Social Media ROI
The simplest social media ROI formula is:
Profit / Investment x 100 = social media ROI %
Profit is simply the money that you’ve earned from your social media campaign and investment is the total cost of the campaign.
While it’s quite easy and simple to use this formula to calculate your monetary revenues, it can get a lot more complicated when your investments produce intangible results.
When calculating non-monetary values, you should use metrics that clearly demonstrate how social media is impacting your business. You can include the following:
- Audience engagement
- Website traffic
- Revenue generated
And when measuring, you should determine whether your chosen metrics align with your objectives, if they help you make significant decisions, and if you have the capability of measuring them effectively.
The proper tools are just as significant as the proper method of calculating your social media ROI. Here are some of the calculation tools you can use:
- Google Analytics w/ UTM parameters – adding this to your social media ads’ URL enables you to find out how much traffic and conversions your social media strategy is producing.
- Hootsuite Insights – this tool can help you recognize the latest trends in your industry, brand, reach, etc. It is supported by millions of data sources, actual results, and an intuitive interface.
- Facebook Pixel – adding Facebook Pixel to your main pages lets you see how many users interacted with your Facebook ads and indicate which ones have converted.
Reporting Your ROI
- Use templates – use analytics templates that allows you to keep an eye on your metrics without the need to build your own custom reports for every campaign.
- Use clear and plain language – present your data as clearly as possible because not everyone can understand high-level social media terms.
- Check your data regularly – you should keep an aye on your social media data frequently to make sure that your goals are being met.
- Have a set timeframe – Pick a timeframe that is suitable for your business and stick with it. Measure data over a period of time and have reports ready on specific days.
Adjusting your Social Media Strategy
Meeting your ROI goals means regularly updating and adjusting your strategy. You have to consider the metrics you are tracking. Decide whether your data needs altering after measuring your first round of ROI before making any strategic changes.
You have to consider changes in user behavior, business goals, technology, and key performance indicators (KPIs). Measuring your social media ROI and setting business goals is not a one-time affair. It is a continuous process that constantly changes.
At Maxeemize, we ensure that your social media investments are maximized for better ROI. We have the expertise, knowledge, experience, as well as creativity, to deliver unique solutions that produce better results for your campaign! Contact Us for a free social media consultation.