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Social Media ROI: How to Ensure Your Social Media Efforts Pay Off

by Kieran Flanagan  |  
March 5, 2012

In this article, you'll learn...

  • How to measure the effectiveness of your social media marketing
  • Three steps to ensuring you can measure the ROI of your social media efforts

Social media marketing can either be an extremely worthwhile investment for your business or a massive time sink that brings little or no benefit. Unfortunately, in the short term, telling those two extremes apart is not always easy. How much is a Twitter follower worth? Can you put a value on the number of times your business is mentioned on Facebook?

First, you need to understand the social media strategy-development process. How can you start measuring return on investment (ROI) if you do not know the steps you need to take to create a campaign? Knowing the process allows you to look at each step from an ROI perspective.

social media guide to success

The clickable image to the left leads to an interactive visualization (courtesy of Simply Business) that provides a step-by-step guide to developing a social media plan. (For further reading, check out the resources noted in each section of the interactive version of the graphic.) Once you understand those steps, you need to start thinking about ROI.

Initial Steps

Here are three initial steps to take that'll ensure your social media strategy is set up to measure ROI.

1. Have a clear motive

Before you kick off any kind of social media strategy, you need a clear idea of what you're trying to achieve. Diving in without a set of objectives (e.g., improving customer service, increasing online sales) means you won't be able to identify social success.

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Kieran Flanagan is inbound marketing manager for EMEA at Salesforce, a leader in CRM solutions that just launched its new Social Success resource site in the UK.

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  • by Michelle Mon Mar 5, 2012 via web

    This is great information. Including the interactive graphic that leads to more info is going the extra mile. Sometimes it's hard to explain the tangible benefits of marketing. It's great to see a how-to for planning and measuring social media effectiveness.

  • by Patrick Zuluaga [PMZ Marketing] Mon Mar 5, 2012 via web

    It is great to see educational articles discussing conversions and mesuring results that add real value to the business. Many a small business owner needs to understand that social media marketing must deliver conversions to be of real value to your business.

  • by Shelly Lucas, Dun & Bradstreet Mon Mar 5, 2012 via web

    #1 is so important! You must know what you’re trying to achieve before determining how you will measure it. In fact, as Olivier Blanchard points out, the question is not so much “What’s the ROI of social media?” as “What’s the ROI of [insert activity here] in social media?” Your goals should, in fact, determine which social activities you engage in. And, as you point out, Kieran, financial KPIs may not apply to every goal—e.g., qualitative conversations. We also need to consider which metrics are relevant to the specific role to which we’re reporting our results. For example, a C-level executive would be interested in how social has decreased costs and/or increased sales. Digital marketers may want to know how social has contributed to lead generation and/or how it has improved brand perceptions. Social strategists, on the other hand, may be more interested in their social influence—how have their social activities changed attitudes/actions of their communities? How engaged are their fans and followers? Risk managers will want to know how social has made teams better prepared to respond to issues that impact brand reputation.

  • by Sean Grace, CoupSmart Wed Mar 7, 2012 via web

    Very helpful tips for business owners, many of which have jumped into social media without clear objectives or a way to know how these efforts are impacting sales. Following these steps could do a lot towards organizing a social strategy and seeing some returns from it.

  • by Marcella Fri Mar 23, 2012 via web

    You said that: - Measuring Twitter traffic for a while was tricky (because so much came via third-party software), but Twitter's introduction of its URL shortener ( removed that problem. Simply add a "+" (plus sign) after the URL, and it will bring you to the information page that tells you how many clicks that URL received.

    I haven't understood how it works.
    Could you explain it more?
    many thanks

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