Social media ROI. It’s one of the great mysteries of life for many brands and marketers. How the heck do you calculate the ROI of a single tweet? Or the ROI of using Instagram for your business over, say, Twitter? Or determine which platform brings in the most revenue for your company? Despite knowing how impactful social media can be, being able to quantify that value gets tricky.
Even the marketers who know they need to focus on this area are often held back by business-minded higher-ups who tell them that without clear evidence of ROI, they can’t invest money into a tactic they know works.
So, in this article, we’ll take a look at how you can measure, track, optimize, and understand social media ROI, and choose which platforms will bring the best results for your business.
What is Social Media ROI?
Let’s start with the basics. The return on investment (or ROI) for any campaign is a crucial metric to track for marketers. It lets you know what’s working and what’s not. If you’re pouring time and resources into a marketing strategy, you need to make sure that you’re getting the most out of it.
When it comes to social media marketing though, marketing teams often struggle to quantify the ROI of a campaign. This is because social media goals are not always based on revenue.
Much of time, social media marketing goals are focused on things like brand awareness, customer engagement, and website visits. These are not necessarily metrics that easily convert to ROI statistics. But, that doesn’t mean they aren’t important. If these are the kinds of goals you’re aiming for, you can still use them to measure your ROI on social media.
How to Measure ROI on Social Media
We’re working on a big post on goal-setting and ROI for social media (specifically influencer campaigns), so be looking for that in the next few days.
But just so we can get to the “which platforms” part of this article, I do want to run down a bit of the goal-setting and ROI info for you since something like 60 percent of marketers agree measuring ROI on social media is one of their biggest challenges.
Let’s take a look at some business goals, the cost of running campaigns, and the actual things that matter when it comes to social media ROI.
Count the costs of “doing” social media
We know what you lose by not investing in social media. But there are costs associated with even the day-to-day management of social media. Before you can calculate how effective your campaign has been, you need to have a clear picture of how much you have invested in your social media marketing. While posting to social media networks, in general, is a free endeavor, there are other factors to consider as investments from your business.
If you’re investing money in scheduling tools, improved analytics, photo or video editing software, research tools, or anything else that helps you build your social media posts and strategy, these costs should be taken into consideration.
For instance, MeetEdgar is a social media scheduling tool. It keeps a virtual inventory of your social media content and automates the publication of your posts based on a post category schedule that you create provide.
So, for instance, every Wednesday, we have blogger roundups scheduled to go out to our networks on LinkedIn, Twitter, and Facebook. Daily at 9AM, we publish blog posts from The Shelf Blog, and around 11AM, we share posts from some of our favorite blogs. Every day. Without fail.
So, if you’re not using third-party tools like MeetEdgar or Buffer (which we use as well) in your social media marketing, you should definitely check some out and consider them. The value they can bring to your marketing campaigns far outweighs the initial costs you must spend to get started (plus, most of them offer free trials to front-load value).
If you're including things like boosted posts, PPC ads, or other paid advertising as part of your social media strategy (and you probably should be) these costs also need to be factored into your overall investment cost to calculate your ROI.
Hiring designers to create marketing assets, specialists to create ad campaigns, influencers to promote your brand, or freelancers to help manage your presence on social media are all great ways to improve your marketing. But they all come with a cost, and this cost will impact your ROI.
The one resource you can’t replace… time. If you and your team spend 20 hours a week managing Facebook, but only 10 hours a week managing LinkedIn, each platform will have a different investment amount to include.
There’s a monthly subscription fee for MeetEdgar… but the tool literally saves us about 10 hours a week of social media scheduling time… or something like $200 to $300 a week just in scheduling and curating our social media feeds.
Add all of these costs together and you’ll have your total investment for social media.
Set goals and objectives for each campaign
Goal setting is an important part of any marketing campaign. Without setting clear goals early on in your campaign, you're setting yourself up for a frustrating cycle of wondering how well your efforts are working… and what they are actually doing for you.
Goal setting isn’t hard, but it does need to be practical. If you’re rolling out a new software system, having people click through to see or schedule a demo is a much better metric of how well a campaign is working than would be, say getting sales. Getting sales is important, but the reality is social media users aren’t on social to find a new piece of software. So, a legit win would be getting them to click through.
Yes, people are growing more and more comfortable with buying online, but many are buying as a result of the positive experiences they are having online with different brands. So, I’m definitely not saying that sales isn’t a solid goal to set. What I am saying is before focusing on converting customers, you need to focus on getting their attention long enough to sell them.
Here are some goals social media are great for:
Brand awareness is probably one of the most important yet least understood of the SMM goals but increasing your brand’s awareness is the first step in every marketing / sales funnel. People have to see you to do business with you, so knowing how to effectively market your brand across social media helps spread the word about your company, team, culture, brand and product (because social media success is about way more than talking about your product).
In a brand awareness campaign, reach becomes really important. So, if you’re going to partner with influencers to announce a new product launch, a new store, the spring line… you want to target larger influencers because they will be able to reach the most people with the announcement.
A successful brand awareness campaign will result in greater visibility, which will lead to more brand mentions, engagement, more followers, and more people sharing your posts with the people in their own networks.
For its Spring 2017 marketing push, Donald J Pliner launched the #ArtofFun campaign on social media to get eyes on its inventory of edgy mid-priced shoes. This was a brand awareness campaign, meaning DJP wanted to get the word out to as many potential customers (not just random people) as possible about its shoes.
So, we (The Shelf worked on this particular campaign) enlisted a set of confident, fashion-forward Millennial macro-influencers who had the influence, the follower numbers, and the engagement needed to help Donald J Pliner get the attention of people who were most likely to “get” DJP’s vibe and want to get in on the extra-ordinariness. These were people who invested in their shoe game.
The campaign produced some really great posts. They were colorful, creative, stylish, and a bit out of step with the typical Instagram posts you see.
UGC AND CREATIVE ASSETS
We’ve done several posts on the topic of user-generated content...
The benefits of UGC
How to drive sales with UGC
How to get amazing UGC in your campaigns
Examples of cool UGC campaigns
Getting the rights to sponsored content
That’s because user-generated content - the posts created by users that get published to different platforms - are the lifeblood of social media and influencer marketing.
For brands, UGC is a powerful word-of-mouth endorsement from key opinion leaders of targeted demographic segments. When presented in the right way, UGC carries more sway than any other type of branded or brand-owned content.
So, we get lots of clients that are looking to get loads of UGC from their influencer campaigns that they can reuse across their own branded social media feeds, in paid ads. Basically, they can use UGC as a creative asset in any way they see fit.
You may not immediately recognize the name Alex Brands… but you know the company’s products. Alex Brands sells some of the most well-known brands in the toy market, like the Slinky and Hot Wheelz bikes for kids. There’s even a National Slinky Day at the end of summer.
Until recently, the company's primary method of distribution and their way to get new products into new markets was through Toy R Us stores. In early 2018, their #AlexBrandsPlays social media campaign was all about boosting visibility by having kid influencers create tons of UGC Alex Brands could use on their own branded social channels.
Source: on Instagram
Speaking of engagement, this is another popular goal for social media marketing. This goal is focused on encouraging your customers and followers to interact with your brand online. This can take the form of liking, commenting, sharing, messaging, or tagging you across social media platforms.
This is a great goal for brands who are focused on a slightly younger audience, as brands appearing authentic and “human” online is a big deal for them.
With younger audiences fast becoming the majority of spenders across the board, having top notch customer service online is no longer simply an option for brands. Platforms like Twitter are perfect platforms for quick responses and public discussions that show how much you value your customers.
Measuring this can take the form of response times, response rates, and the resolution of problems via social media.
Which Social Media Networks Will Deliver the Best ROI for My Campaign?
The real reason you’re reading this is to determine which social media networks provide the greatest ROI, right? So let’s dive into some platform-specific analysis to see where your business or brand can get the most bang for your buck.
I do feel like we need to reiterate that interpreting the results of any social media campaign always goes back to the goals you set. Your goals also determine which social media platforms you use to accomplish your goals. while one platform may bring in amazing results for one brand, it may not do the same for you if your goals do not align.
For this reason, we’ve organized the top social media networks by the goals they are most likely to help you reach.
For Brand Awareness
With over 2 billion users, Facebook is the largest social media network in the world. So, it is highly likely that your target audience is spending time here. Facebook can be a great platform for those who have placed brand awareness as their number one goal on social media.
Facebook’s algorithm shifted in 2018 to favor personal content over posts by business pages, and this definitely put a thorn in marketers’ sides as their reach was slashed. But, a shining light came in the form of Facebook groups and the platform’s new feature that allows pages to post in groups, just like individual accounts.
If you’re leaning toward paid ads on Facebook, “Brand Awareness” is also a campaign goal that you can access in the dashboard of your Facebook ads manager. You can choose ad recall as a goal, you’re working towards “Ad Recall” to ensure people remember seeing your ad two days later. Marketing is about more than just reaching lots of people; it’s also about sticking in those people’s minds.
If you have money to spend on advertising on Facebook, you’re going to see even better results. According to research by the social media scheduling tool Buffer, Facebook ads can bring in some pretty great ROI. Their experiment saw the average price on Facebook for a thousand impressions was $0.59, compared with $3.50 on Twitter - a big difference.
For Building Community
Facebook is also a great platform for building a branded or industry-specific group. And if you do that, you’re in luck because Facebook favors group posts more than anything else right now. A Facebook group will enable you to get your content in front of a group of people who have already demonstrated an interest in your content.
Brands can also join and participate in groups as a business page, so social media managers don’t have to worry about their personal brands being overshadowed by their professional brands on Facebook. They can remain separate.
LinkedIn is the home of professionals on social media. There are 40 million decision makers on the platform, so it’s the place to be if you want to establish yourself as a knowledgeable professional, do targeted B2B marketing, and attract new clients to your business.
For Establishing Authority
LinkedIn is the place professionals go to connect with, talk to, and hear from other professionals. For brands, LinkedIn presents a moderately captive audience who is checking in for one reason and one reason only - to find professional opportunities. Those opportunities could be sharing an interesting post they read, sharing an idea they want to spread, sharing information about their company and culture…
All these little bits of information will come together nicely to help people establish credibility and build authority in their specific area of expertise.
For Website Traffic
Let me share some really interesting stats I found at Omnicore.com.
Of the 500 million LinkedIn users, 3 million of them share content weekly and 1 million users actually create articles for LinkedIn. But here’s the thing: 91 percent of marketing executives peg LinkedIn as the best place to find quality content. It is currently THE #1 platform B2B marketers use to distribute content and LinkedIn makes up half the traffic to B2B websites.
For Generating Leads
LinkedIn leads the pack when it comes to using social media marketing to generate B2B leads. LinkedIn accounts for 80 percent of B2B lead generation while Twitter and Facebook account for the other 20 percent.
Sponsored InMail allows users to inbox personalized messages to other users, whether regardless of whether there is an existing connection on the platform.
Brands use Sponsored InMail to facilitate trust with new potential leads, send out invites to webinars or in-person events, or to pitch their services to business owners.
InMail isn’t the only advertising option at your fingertips though, LinkedIn offers a range of different ways to reach new customers.
Sponsored Content - In the same way you can on Facebook, you can plug some investment into existing posts you’ve sent out from your company page to help them reach more people. This should be reserved for your best performing posts.
Display Ads - These appear in people’s LinkedIn feeds just like Facebook Ads. You can use text, images, and video to attract people’s attention.
Dynamic Ads - Display ads on steroids. These are shown to people based on their activity, making them hyper-targeted compared to the usual fare.
It almost goes without saying that this platform is great for B2B brands, or those who have services that would benefit busy professionals. This is probably the most niche of all the social media networks, and not everyone will be able to benefit from advertising here. So, make sure you fit the LinkedIn mold before going forward with a campaign here.
For Product Launches
Instagram is my absolute favorite platform for engaging and connecting with customers and influencers alike. It reached 1 billion users in 2018 and is only going to get bigger. Thanks to it’s visual nature, content on Instagram is much easier to digest and engage with as it require less concentration and shorter attention spans.
For Customer Engagement
Instagram gives you a number of ways to reach your audience on their platform - all of which encourage engagement and interaction. Because the site is accessed almost exclusively on mobile devices, it’s a place that is ever-present in many of our lives. The platform is key for engagement based goals as it brings in 10 times more engagement than Facebook does, despite not having as many active users.
Thanks to the “Explore” page and the power of hashtags, discoverability is much higher on Instagram than other social networks, which helps brands to connect with more people. This also means this can be a great platform for reach as well, but you’ll have a more limited demographic than you would on Facebook, which is why we positioned it in this way.
There are two ways to post on Instagram - in the main feed, and in your stories. Both offer different advantages, and both should be undertaken simultaneously for maximum impact. Unlike other platforms where engagement is limited to likes and comments, Instagram offers users a number of ways to interact with your content.
If you post to Instagram Stories, viewers can interact in the following ways:
Swipe up - if you have a following of over 10k and are operating on a business account (which you should be), you can include a link in your story that viewers can access by simply swiping up. Other than this, the only way to include a clickable link is in your bio on your profile. This is an incredibly useful tool for businesses looking to drive web traffic through social.
Questions - If there’s something in particular you want your followers to tell you about, then you can post a question on your story. With this feature, you’re actively encouraging engagement by giving your followers the chance to speak directly to you. You can then share their answers on subsequent stories to further increase their effectiveness.
Polls - Polls on Stories are pretty self-explanatory. You pose a question to your followers with two possible answers and all your followers have to do is click one, and there’s your engagement.
Combine all of these with the usual options of liking, commenting and direct messaging, and you have a catalyst for huge levels of engagement that you just won’t find anywhere else on social media.
The final of the big four is Twitter, and this is the place to be if you want to focus on customer service across social media. Thanks to the fast pace of the online world, we are no longer content to sit on hold for hours with customer service teams (not that we ever liked it in the first place), so businesses need to be able to respond quicker than ever.
For Talking with Existing Customers
That’s where Twitter comes in. The fastest-moving of all the social networks, it’s the ideal place to keep up with customer requests. Because it’s such a public way of dealing with customer requests, many people love to use this in the hopes of receiving a speedy and positive response, as they know that others will be watching.
This means you need to be quick off the mark, and prepared to help diffuse any situations as soon as possible. But, providing awesome customer service isn’t just limited to direct questions sent your way. Keeping your eye on brand mentions on the platform is another way to make sure your customers stay as happy as possible.
See how Unbounce responds to a brand mention to help their customer, as well as turn the situation around in their favor? This is the kind of quick thinking that helps keep your customer service in tip-top shape.
For Getting Clicks
So, this last one is really from our personal experience. On the word of Gary Vaynerchuk who said during a keynote or fireside chat or something last year that Twitter ads were under-priced, we leveraged the reach of Twitter to promote a downloadable guide to rolling out an influencer campaign ahead of last year’s holiday season.
The response was phenomenal. Within a span of about two weeks, we saw more than 1,000 downloads of the guide.
Here’s the thing though: Because we weren’t nearly as focused on list-building as we were on testing Twitter’s fire and getting the guide in people’s hands, the landing page for the guide gave visitors the option to opt-in or not. What I mean is they could download the guide and skip town for all we knew. Despite not NEEDING to opt-in in order to get the guide, about 1 in 10 did.
So, when it comes to promoting content to get clicks and traffic back to your site, Twitter is a really affordable way to go.
For Getting Shares
Whether you’re Marvel promoting the next Avengers movie or Daquan spreading the next great meme, your Twitter network is key. Because so much of your reach on Twitter comes from engaging with and sharing other users’ content, creating content specifically to grab the attention of your Twitter followers can help you grow your network and build your reputation in the process.
We have to agree with those who claim that measuring ROI on social media really does differ from case to case, but having a firm grasp on your campaign goals is the first step in making sure you get the most out of your marketing.
By understanding our goals, you can understand where to place your efforts on social media. Social media is a great way to bring in customers, engage with your fans, and keep on top of customer service - if you do it right.