Blog Archives

How do you measure return on investment on social media?

Posted by on December 21, 2011

Marketers are trying to figure out how to measure return on investment (ROI) from their social media marketing activities. The pressure to measure is on and 2012 will be the year we move away from fans and followers to actual value of our social media efforts.

You can measure ROI of your social media by using the right traditional and digital metrics. Two good tips for beginning to track how you do with social media is staggering your activities and using unique URLs.

1. Stagger your marketing activities will help you find out what’s working and what’s not working for your social media marketing.

A very important metric every business needs to know is the value of their customer. Without lifetime customer value, it will be hard to determine the ROI from social media.

To calculate Lifetime Value of a Customer=(Longevity*Revenue)*Margin

To calculate the value of a visitor:

Now, how this relates to your social media activities?  To calculate the value of your blog, use the value of a visitor that you already calculated and the amount of traffic your blog receives.

This is a fairly easy way to measure the return-on-investment for your social media.

2. Use a unique url to track all of your online activities. An easy and excellent way to see the type of traffic you are getting from each activity. Use unique URL for your blog, Facebook, Twitter, LinkedIn, video, and every digital action you take. This way, you will know very well what is working for you online.

Another way to see what the value of your Facebook page is will be to take an old email marketing approach to it. To calculate the value of your Facebook social media efforts based on your email marketing, you can use Jay Baer’s valuation worksheet below.

Facebook valuation worksheet – Convince and Convert

View more documents from Jay Baer

In addition to marketing applications from social media, we also have customer service return on investment from social media and sales return on investment from social media.

ROI on customer service. Studies show that by implementing social into your business, you can improve your customer service score, thus generating more word of mouth and referrals. To measure your customer service score you can use Net Promoter Score as a baseline before your social media and then measure it after making your business social.

 ROI on sales. Lowe’s sold $1 mil more in paint by implementing social in their business process and allowing employees to share ideas internally. For a good bog post on how to calculate the ROI for sales, check out this Social Media Examiner’s post.

Below is a good presentation from Social Media Today on return on investment on social media for both B2C and B2B. The screen shots and insights above were extracted from the Social Media Today’s presentation.

What do you think? Do you currently measure return-on-investment from your social media? Do you need to?  Small businesses are in the perfect position to measure the return on investment from social media. If you are currently not measuring your social media, are you planning on doing so soon?

Categories: Analytics Blog eMarketing Interactive marketing Measurements Social Media Social Media Marketing | 3 Comments »

How to measure social media

Posted by on October 30, 2009

Social Media.Yes, it’s great but how do you measure it? I hear this statement a lot by business people trying to grasp with this new way of communication and its applications for marketing, sales, customer service, PR, research and more. A lot has been written about the topic of how to measure social media. Some people are for measuring every dollar and minute that goes into social media efforts, and some are against measuring it. Some people are justifying it with a simple statement of “What’s the ROI of putting your pants on in the morning?. You do it every day,right?” or  “How do you measure the relationship with your husband/wife?”

So, how do you measure social media? Is that such a thing as ROI, whether that’s Return on Investment or Return on Interaction? Should we measure ROE – Return on Engagement?

Olivier Blanchard developed a very nice presentation on how to measure social media efforts. It’s one of the best I’ve seen so far:

Olivier Blanchard Basics Of Social Media Roi

A survey by Deloitte, Beeline Labs and the Society for New Communications Research states that  there is a “significant gaps between community goals (such as generating word of mouth, customer loyalty and brand awareness) and how success is being measured.

The top two analytics for measuring success are the number of active users (34%) and how often people post/comment (32%), which indicates that participation is still considered to be the biggest measure of success.”

beeline-deloitte-tribalization-analytics-used-2009

A few more examples of how some people/businesses measure their social media efforts:

  1. Scott Gould, founder of Like Minds, put on a conference that was strictly promoted via social media. His conference produced sales of 5,800 British pounds with 0 marketing budget.
  2. The Huffington Post reported Facebook referrals increase of 48% through their Facebook Connect feature which has accounted for 3.5 million visits.
  3. Pure Michigan soared to 20,000 Facebook Fans. In a previous post I wrote I referenced Gammet Interactive and Dave Serino’s study of how social each US state is. Michigan at the time of the study came up to Number 7 in the country in terms of how well they utilize social media.

In my opinion, before you struggle to find ways to measure social media, ask yourself the following questions:

  1. Why are you engaging on social media? What is your purpose and business objectives? This will lead to what’s important to you to measure.
  2. How do you currently measure your marketing efforts? There are many similar measures that you can use in measuring social media.
  3. How do you currently measure your PR efforts? There are metrics that you could implement for your social media efforts as well.
  4. How do you measure your customer service? A simple metric like Net Promoter Score could be used as a benchmark prior to your social media efforts and after you get involved.
  5. What website analytics are you using? There are various services that implement social media measurements with your website reports to provide a global view and give you a really good idea of what’s working best.

The measurement tools exist. My challenge to you is to think about social media more in terms of a two-way dialogue and less in terms on dollar signs. If you are transparent and authentic, bring value to people, answer their questions and give them information they seek, they will remember you when it’s time to purchase your product/service. Your bottom line will improve.

What do you think? Do you currently use social media? Are you measuring it? If so, how?

Categories: Analytics Blog eMarketing Measurements Social Media Social Media Marketing Web 2.0 Web 2.0 tools | 2 Comments »

How to measure your marketing and social media marketing efforts

Posted by on May 31, 2009

Mountain Biking in Moab

Milena Regos Mountain Biking

What do business, marketing and social media marketing have in common with mountain biking in Lake Tahoe?

A lot as I found out yesterday. I went for an amazing bike ride yesterday at Sawtooth Trail near Truckee, CA with my husband. He’s an excellent rider. We started off and within minutes I wasn’t able to see him anymore amongst the pine trees. When he stopped to wait for me, I asked him while trying to catch my breadth: “Why am I biking so slow?”. He responded: “You are not slow at all, you are doing really good. I’m just too fast. Remember to look ahead and prepare for what’s coming ahead of time”. It got me thinking about business in general and how some companies are doing so well yet others fail, how some businesses anticipate what’s coming ahead on the trail and prepare for it by shifting gears on time and how some companies fail to do so and end up in the back of the group.

Continue reading How to measure your marketing and social media marketing efforts

Categories: Analytics Blog Business Email marketing eMarketing Interactive marketing Lake Tahoe Life Marketing Measurements Media Outdoors SEM SEO Social Media Social Media Marketing Web 2.0 Web 2.0 tools | No Comments »