Imagine you’re a marketer evaluating post campaign performance. After painting a rosy picture of your sponsored posts’ stellar click-through and engagement rates, as well as the reach earned from influencers used, your Chief Marketing Officer (CMO) hits back with questions like these:
- How much sales did we generate from each dollar spent?
- How many new customers did we acquire from each influencer?
- How many people who clicked on our Facebook post, actually completed their purchase?
Mary Meeker’s Internet Trends 2017 reported as many as 61% of advertisers citing measuring ROI for social media as their top concern. Despite the evolution of social media networks and marketing technologies, marketers are still at a loss over measuring the impact of their social activities on the bottom line. Misalignment of metrics, and lack of understanding of social media’s role in the business, are some of the biggest obstacles to this.
With this in mind, we set out to debunk the top 5 myths of proving social ROI, while giving you some tips to better measure your campaign’s success!
Myth #1: Social has no concrete impact on my company’s bottom line.
Calculating value created by social activities for your company can be challenging – but not impossible.
When tying social ROI to business objectives, consider:
- Direct returns: Use dedicated landing pages and tracked links to track and attribute sales or new customer sign ups to your social media campaigns and channels.
- Indirect returns: With customer journeys becoming more and more multi-faceted, social is not a one off occurrence. Analyzing the difference in revenue, new customer sign ups, and web traffic earned during the duration of your campaign, can help estimate your activities’ indirect impact on your company’s bottom line.
- Framing your KPIs and marketing funnel: Associate objectives with relevant stages in the marketing funnel, so you can analyze how well your campaigns have paid off at each stage of the customer’s journey, as well as determine attribution.
- Using tracked links or dedicated web pages: A clear breakdown of sales, contact form submissions and traffic, can help re-allocate budgets and activities to higher performing channels for your next campaign.
Myth #2: Social is only valuable as a branding tool.
As social hits an all-time high of 3.196 billion active users and 42% penetration worldwide (We Are Social, Digital in 2018), brands should not miss this opportunity to connect and engage with their customers.
However, it is short-sighted to view networks like Facebook, Twitter and Instagram as a platform solely for showcasing your brand and content. Brands need to not only increase engagement on social networks, but also use it to deliver all encompassing customer experiences at every touchpoint, while accelerating the path to purchase.
Break away from a siloed approach to social media as a marketing tool, by using it as a cost effective platform for:
- Product launches,
- Holiday sales,
- Customer care, and
- Converting fans to customers and brand advocates
Brands can also mine social media for precious consumer and industry insights, so as to:
- Anticipate current and future trends,
- Detect competitors’ strategies,
- Identify business opportunities, and
- Expand market shares
Myth #3: Social ROI can only be measured in terms of revenue.
While attributing revenue and new customers acquired to social are the most direct measures of how much returns your campaigns have delivered, it is not the only way to measure success.
To get a robust understanding of how your time, effort and budgets are paying off, both in the short and long run, include soft objectives, such as:
- Brand building: What was your brand’s share of voice and sentiment score during and after your campaign?
- Nurturing: How many fans were converted to new customers, as a result of your activities?
- Customer experience: How many touch points did your campaign activate on social? Was the transition from social to website a seamless one?
Myth #4: High engagement rate is a sign of a successful social media campaign.
Likes, comments and shares may indicate a thriving campaign reach, but they are not the be-all and end-all of social media marketing. After all, a well received piece of content or an active fan base does not necessarily lead to a purchase.
Use engagement metrics as indicators of how relevant and enticing your content and calls to action are, benchmark them against things like cost per click and purchase or contact form completion rate, and optimize activities from there.
Myth #5: Social ROI should be measured on its own.
Yes and no.
As platforms like Facebook, Twitter, Instagram and YouTube continue to evolve and acquire more users, social as a whole will grow to become an important part of a marketer’s arsenal, whether to increase sales, enhance customer experiences, and more. Thus, it is important to constantly measure the performance of social as a marketing channel, to determine how you can further optimize activities and reap more returns.
At the same time, the customer journey is no longer linear. Thus it is essential to also integrate social into your overall marketing strategies. Consider where it fits in your marketing funnel or customer’s journey, and translate your objectives into the way you measure ROI.
Analyzing and reporting ROI is constant and continuous. Set up a schedule for monitoring KPIs to optimize social media activity, and translate objectives into daily work processes.