How to Measure Social Media ROI
As a digital or social media marketer, you need to be able to track and calculate your social media ROI (Return on Investment). It shows the value of your social campaigns in dollars, euros or yen so you can double down on the tactics that work and avoid those that don’t.
Social media is a powerful part of any marketing strategy to drive brand awareness and ROI and is growing in importance as shoppable posts and social commerce become a reality.
In this blog, we’ll show you how to measure your ROI and provide tips to improve it so you can boost the value of your social media activities.
What is social media ROI?
First of all, let’s define what social media ROI is. Like anything that refers to a Return on Investment, it’s the value of your social media activities divided by the investment made.
The formula to calculate ROI for social media is:
(return – investment made) / investment made X 100 = social media ROI
If your ROI value is more than 0 percent, you’re making money from your social media campaigns. Anything below that means you are losing money.
“34% of marketers said they were uncertain about their ability to measure the ROI of their social media marketing efforts ”
How do you calculate social media ROI?
How you calculate ROI depends on the objectives of your organization and the metrics you use. You can download our social media campaign ROI calculator to keep track of your goals, costs and returns.
For example, is brand awareness a priority for your social media, or is it lead capture or sales? When creating your ROI metrics, bring them back to the objective and goal of your activities to prove value.
There are many social media goals you can choose. It really depends on your core objective, which could be:
- New followers
- Click-through rates
- Conversions
- Completed lead generation forms
- Downloaded files (e.g. eBook, whitepaper)
Common metrics to help measure social media ROI include:
- Engagement - as one of the most common and valuable metrics, engagement on social media shows the level at which people are interacting with your content and brand. Altimeter research found that over a third of content executives use engagement as a metric to gauge performance. Types of engagement metrics include clicks, shares, likes, and brand mentions.
- Reach - This metric is all about who sees and interacts with you on social media. It’s about audience size and shares, it looks at how far your social media content travels and is seen. It can be harder to measure than engagement as it only looks at how many people saw your post, but it’s important to track.
- Leads - Social media plays a role in lead generation and it’s important to know which channels provide leads and what content drives those leads. For ROI you want to be able to link your campaigns to activity so knowing your lead counts is useful to show performance.
- Conversions - When you put so much effort into your social media content and posts, it’s important to know at what level they convert. The easiest way to do this is to use UTM parameters on the links so you can track clicks by campaign and platform.
How do you track ROI for social media?
Once you select a goal or goals for your social media activities, you will need to set up a system for tracking your ROI.
- The easiest way to do this is to set a goal in Google Analytics. You can do this by setting up goals and event tracking. Read through our Google Analytics Goals Guide to understand all that’s involved and what you need to do.
- If you want to track other metrics - likes, shares and brand mentions - use a platform like Buffer or Ahrefs.
- If you’re new to Google Analytics watch this video to get a step-by-step guide on how to use it.
