Even though it may be difficult to attribute leads to specific social media sources, you can make useful correlations between social media and improvements at your organization in revenue, website traffic and other areas. In this informative piece, we’ll look at the long-term ramifications of paying attention to your ROI in social media marketing campaigns.
As the social media platforms have begun to elevate incrementally in recent years, business has taken a new sales platform along with it in an attempt to blow with the winds of lead nurturing change. Many companies fear that there’s no true way to measure the ROI of social media activities. In comparison to other marketing channels such as e-mail, SEO, and display advertising, social media doesn’t offer a very direct or concrete ROI measurement. This is partly due to the fact that social media interactions revolve mostly around online conversations, which are not as easy to measure quantitatively as a click-through or CPMs. Because social media is very much about the qualitative not the quantitative, this results in much debate about what metrics are truly useful and accurate when it comes to social media marketing.
There’s still a lot of debate around what “engagement” really means and if it’s something that can actually be measured quantitatively. For the purposes of this article, we consider engagement to be a category of interaction that includes posts/threads, comments, tags, votes, bookmarks, and more. Another important area of measurement for social media is brand and awareness. Traditional media might measure brand and awareness through reach and frequency: how many people have seen an ad and how many times they’ve seen it. These days, there are technologies that measure posts for positive and negative sentiments, and which measure “share of voice” (i.e. the number of articles, tweets, posts, etc. in which a specific brand is mentioned in comparison to its competitors). Although the world of social media brings with it new ways of measuring activities and interactions, the traditional ROI metrics of revenue – cost savings, conversions, cost per lead, etc.– are still what matters when it comes to proving the value of your social media marketing initiatives.
Much of the difficulty in measuring social media efforts stems from the inbound lead. While it’s revered for its high level of qualification, interest and sales readiness, it is also difficult to attribute it to any specific marketing campaign. As we have probably already seen in our individual business efforts, many inbound leads can be attributed to “word-of-mouth” and partner or employee referrals. For inbound leads arriving via a website or phone call, attribution to a single referral source can be even more difficult. Moreover, the idea of “first touch” and “last touch” is even more complex when it comes to social media yet with the correct planning and attention being paid to your sales, the complexity will become verbose in terms of everyday sales.
Just because measuring social media ROI is a challenge doesn’t mean it’s impossible. The world of social media ROI is still evolving. In most cases, we have to rethink traditional metrics to include the ways that people interact with social media. For example, the standard metrics for e-mail marketing include delivery, open and click-through rates. While it’s still possible to find value in measuring click-thru’s from specific URLs on sites such as Twitter or YouTube, social media also lends itself to new categories of measurement, such as activity and engagement.