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What’s the ROI (Return on Investment) of Social Media?

2016-11-02-10-37-45One of the questions we often get asked is what our “ROI” or “Return on Investment” results are like for Social Media and what results can we promise in return for a financial investment into Social Media.

Now we have to be honest and say that this is a question we often struggle with because if you are asking what your ROI from social media is, you are typically asking the wrong question. Social Media is a difficult beast to try and measure as it is very subjective, and it depends what your business is trying to get out of Social Media, as to what your ROI is, and it’s effectiveness.

Marketing leader “Social Media Examiner” offers this broad definition: “Social media ROI is defined as a measure of the efficiency of a social media marketing campaign.”

If a business wants to get hundreds of “likes” on their Facebook Page, or wants a thousand people to see their content and they achieve this, they may consider that their ROI has been met, but it doesn’t necessarily mean that these are going to convert into sales.

We had a client recently who sells makeup. She approached us because she was getting engagement on her page but she wasn’t making any sales. When we had a look she had 2000 Facebook “likes” which is amazing for a small company, but upon closer inspection we discovered that she had paid a company to buy “likes” and they were all in South America. Those people were happy to engage with her content but they were never going to buy from her. The quality of your “likes” or “followers” is as important as the quantity.

You cannot measure the ROI of having hundreds or thousands of followers on a social media platform because it is based on many variables.

As the great Gary Vaynerchuk says, asking what the ROI of Social Media is, equates to asking what is the ROI of your mother?

 

There are some statistics you can gain from Social Media to help interpret your ROI, but a lot of it is qualitative. Therefore it is important to integrate Social Media as part of your overall marketing strategy. Social media is the equivalent of today’s Yellow Pages. If you are not on it and doing it well, then your clients won’t take your business seriously.

You need to be on there and be visible, as all of those “soft touches” do increase your brand awareness and can lead clients to think of you when they want your product or service though it might not be measurable because you may not ask where they found you, or they may not click through directly from Social Media in a way that analytics can measure.

Questions your business should ask instead of considering a statistics based ROI:

  • What social media should I be on?
  • When should I be on social media?
  • Why should I be on social media?
  • How can I best utilise social media for my business?
  • Who am I aiming to reach on social media?

These are the things that Elvia Marketing can assist with and can measure for you.

Having a good social media marketing strategy, where you are posting regularly with a clear, consistent message and you are engaging and being “social” helps your ROI. Analysing who your followers are, what their pain points are, what they want and how you can help them helps your ROI. Having a clear idea of what you want your followers to do as a result of seeing you on Social Media helps your ROI.

This is how we add value to your business to try and help you increase your Social Media ROI.

Another Question worth asking is:

  • Does my business have the time, knowledge, skills and motivation to do my own Social Media well and increase our Social Media ROI ourselves?

In many businesses, Social Media is commonly either done by the business owner, in and around the hundreds of other things they try to fit into their day, or it is left to the admin person, or often the youngest person in the office who knows how to post on Facebook. If this is how your company runs it’s Social Media accounts then your ROI should take into account the financial cost of your own time or your staff’s time spent doing Social Media, and whether the level of your social media competency is providing any return, or would it be better to utilise the expertise of a Social Media expert to help increase your ROI.

Outsourcing your Social Media to an expert is more likely to increase your ROI

To conclude, Social Media ROI is based on many variables and is often hard to measure. It also isn’t an overnight thing. You aren’t going to put out one lot of content and get hundreds of sales back, unless it’s exceptionally good content that goes viral – Chewbacca mask lady for example which sky rocketed the sales of Chewbacca Masks! You need to spend time building up the “know, like, trust” model on Social Media before someone will be ready to buy from your business and so with Social Media you are playing the long game to get that ROI!

“Social media doesn’t transform your business overnight. It takes a while to see any real growth or measurable results. But that doesn’t mean it’s not working. It just takes time.” – Jenn Herman

November 2, 2016 In: marketing Comments (None)