Social Media ROI

As more organisations use social media they invest more time and money.  This may point to the fact that business will want to ensure there is some return on investment on their commitment of time and money.  To date, there is no clear formula that can be used to measure ROI.  And although social media ROI may be challenging it is not impossible.  Here are some tips:

Determine Costs:

At a very basic level, you can assess the costs of your social media strategy by determining how many hours are spent on social media activities and then multiplying these hours with the appropriate hourly dollar value of the person who is active on social media.

Soft Metrics:

Likes, comments, shares or followers are known as ‘soft metrics’ in social media.  They are easy to measure but they are not entirely accurate.  However, they shouldn’t be dismissed out of hand.  They can provide an general brand awareness evaluation that is difficult to quantify but has an effect on the social media platform.

Benchmarking:

Establish your goal/s with a starting point of data.  This can then be used to measure the effectiveness of the goals over a period of time.  Future data can be measured against this original data to measure the value of what has been achieved.

Know the Purpose of your Social Media Platform:

When you know what your social media platform is being used for, then you will have some idea of whether your purpose is being met.  For example, if you want to use the platform to provide customer service each problem solved is a tick in the ROI.  What do these ‘ticks’ mean.  Well what is the financial value of successfully solving a customer problem?

 None of these approaches are complete but are a starting point to use as business adapts to social media usage.

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Tags: SMEs • Social Media & Business • Social Media ROI • social media tips