Five Easy Steps any Business Owner can Follow to Measure ROI for Social Media
It’s all well and good jumping onto the Social Media band wagon, but what is the best way for businesses to measure ROI?
For today’s instalment I thought it would be interesting to write about ways a business can measure ROI when it comes to Social Media.
Determine How Much You Invest in Social Media Marketing and Maintenance
You might think that the amount of money you spend is strictly the amount you pay monthly on banner ads and social media or pay-per-click campaigns. Whilst this will be the majority of your Social Media Spend (SMS), your time and the salaries you pay others to manage your profiles and respond to customers should also be considered. Add up how much you spend on tools, advertising campaigns, and also put a value to the time you spend.
Determine the True Value of Your Customers
Your followers and your subscribers are not all loyal. Social Media is used to attract new customers and also to retain existing ones. A Customer’s Lifetime Value is a very important metric when you are calculating your ROI. Your customers and followers will share your brand with their friends, which is what makes them a valuable customer. One way to put a value on your customers could be by doing a poll, and asking your customers how much they spend with your company each year. When you receive the estimate, multiply the number by the average lifetime of a customer and you will have an accurate Customer Lifetime Value for each customer who was engaged.
Determine the Value of Your New Customers from Social Media
Another potential way to understand your ROI, you will need to use Google Analytic tools to track sales, conversions, and returning customers that come specifically from Social Media sources. You can place a value on each of the new customers you have via Social Media.
What is Your Value in Impressions?
Making positive impressions does not earn you money right away, it can earn you a fortune in the future, and this is why you should consider your Brand Impression Value whenever you want to know your Social Media ROI. To calculate your impression value, make sure you add up all of your views, subscribers, and followers on Facebook, Twitter, and other social media platforms.
Consider Your Customer Service Value
Some businesses use social media platforms strictly to provide customer service. If you are trying to reduce the money you spend on customer service, using social media is perfect for you. Come up with a palpable amount of how much you are saving on your customer service costs and returns, and use this figure to work out the value.
Just a few ways for businesses to measure ROI when talking about social media, new tools and applications are always being developed which means that new methods are always emerging to keep on top of ROI for social media, so staying on trend is quite important within this industry.
Thank you, I hope you’ve enjoyed this week’s instalment, feel free to leave comments etc.
Nisha Kaushal – Social Media Manager