If you work in a digital marketing agency or a social media marketing team, you must be able to monitor and determine your social media ROI (Return On Investment). It shows the cost of your social media campaigns in dollars or euros, so you can invest more in successful strategies and less in unsuccessful ones.
The relevancy of social media is increasing as shopping posts and social commerce become a reality. Social media is a significant component of any marketing advertising strategy to increase brand awareness and ROI.
Calculating the ROI of your social media marketing efforts can be challenging since your entire strategy and content output aren't connected to certain CTAs or attribution links when it comes to organic social media.
In this article, we’ll go over the critical things to know and the basic steps to take to quantify and measure the ROI of your social media marketing efforts.
The social media ROI is a measure that demonstrates how much value your social media investments have produced. ROI is frequently quantified in terms of money. However, ROI can first be measured by non-financial criteria in situations when it is difficult to trace the direct influence on revenue.
For instance, if the objective of a paid social media campaign is to boost brand awareness and impact, ROI could be determined by an increase in the number of followers or post impressions.
Your goals should be the only determinant of the metrics you employ to measure social media ROI for your own company.
For your company, tracking social media ROI should be a top priority for several reasons:
The simplest formula to calculate the ROI is:
Profit/Investment X 100 = Social Media ROI
However, your company’s goals and the measures you choose will determine how you calculate ROI. You can select from a wide range of social media objectives. It relies on your main objective, which can be:
Common metrics to help measure social media ROI include:
Engagement: Engagement on social media, one of the most popular and useful metrics, reveals the frequency with which users connect with your content and brand.
Reach: The focus of this metric is to find who sees and engages with you on social media. It considers audience size, shares, and the number of times your social media post is viewed.
Leads: Social media contributes to lead generation, thus it's critical to understand which platforms deliver leads and what content encourages those leads. Knowing your lead counts is helpful to demonstrate execution.
Conversions: Knowing at what level your social media material and posts convert is crucial when you invest so much effort into them. Using UTM parameters on the links to track clicks by campaign and platform is the simplest way to accomplish this.
You must create a strategy for tracking your ROI after choosing a goal for your social media campaigns.
You’ve calculated your revenue. Now, it’s time to report on it. Not sure where to begin? You should follow these easy practices to produce an insightful social media ROI report:
Calculating ROI in digital and social media marketing can be a daunting task. While you can take these suggestions to decide what’s best for your business, it is preferred to take help from a professional and experienced digital marketing agency for your one-stop social media marketing solutions. It will help you understand the fundamentals and intricacies of social media marketing.