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The Challenge Of Measuring ROI in Social Media

HubSpot, the Internet marketing software company, recommends companies start thinking about how their marketing agency measures ROI for a marketing campaign. Measuring the ROI is not an easy task and for many marketers it is even more challenging to prove the revenue for a social media management team. What are we measuring? Do we count the number of fans, followers, comments, “likes” or “retweets”? Do we evaluate the brand perception? Should we just consider the revenue from sales?

These are all great questions and the first step is to ask what objectives (Return) we want to achieve with the integration of social media and what actions or resources (Investment) are needed to achieve these objectives. It is necessary to set goals, and it’s necessary to align them with business objectives and the needs of their audience. For emphasi,s the needs of the audience is critical. The most successful campaigns are those that focus primarily on the client.

Once the goals are defined, consider the following steps that the social media expert Brian Solis mentions in his article “Social Media ROI: ROI Doesn’t Stand for Return on Ingnorance“:

1. Understand the need and the opportunity amongst customers and prospects
According to report from MutualMind Group (2011), the most successful campaigns in social media focus on listening and understanding the audience. By listening, we detect customer misunderstandings and possible business threats, know what matters most to our customers and identify demands and even possible alliances with new business partners. In addition, monitoring a real-time web environment will help provide a direct response to customer demands and give tools to react faster than competitors.

2. Design programs that meet customer’s needs, offer tangible value, and also tie to business objectives
A campaign should involve 100% of the target audience using multimedia content, crowd-sourcing projects, contests, promotions, etc. In social media empower the user’s personal experience and their relationship with the brand. This approach of giving “the power” back to the audience translates to positive and measurable actions (such as more web traffic, more visitors, more “clicks”, more sales, more recommendations, etc.).

3. Integrate Key Performance Indicators that capture progress, performance, and opportunities for optimization
Margaret Francis, Vice President of Product at Lithium suggest the following indicators to capture the progress and performance of a campaign:

  • Brand Perception Metrics: Sentiment, brand equity, customer satisfaction, media relations, relationships with influencers, likeliness to buy, and likeliness to recommend
  • Marketing Efficiency Metrics: Improved rankings (SEO), reach (followers, fans, forwards, invites, word-of-mouth, retweets, shares, etc.) research (reduced cost cost of surveys, focus groups, etc.)
  • Revenue Growth Metrics: Relationships with potential clients (downloads, subscriptions, comments, members, fans), leads (comments, ratings, recommendations), sales (via promotions, offers, links, social media)
  • Support Savings Metrics: Content creation by users (forums, ratings, reviews, groups), support case metrics (cases per channel, response time per channels, wait time per channel, customer satisfaction per channel), call center costs defrayed

4. Create a disciplined process that can replicate across the company
When measuring the ROI, a company should draw road maps or well structured action plans. Jeremiah Owuan (Altimeter Group) recommends the following framework, which gives the right data to the right roles.

Plan de trabajo en ROI

What process do you apply for measuring the ROI in your social media campaign? Do you recommend any other systems that you find effective?


This post is also available in: Spanish

Categories: Business, Social Media
Sara del Valle
About The Author - Sara del Valle
Sara is a bilingual subject leader expert for social media marketing. She is originally from Spain and graduated from University Carlos III de Madrid (Spain) with degrees in Journalism and Audiovisual Communication. She founded the Hispanic advertising agency Atraza with the goal to provide business with more options to create engaging dialogs with Spanish speakers in the US.

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