If I had a dollar for every time I heard or read the question, “What is the ROI of Social Media?”, well, i’d be rich.
The ROI of social media is with out a doubt one of the most common questions asked by executives, in particular when you might be attempting to “sell” a social media program or the “need”, to them. It indeed can be a tough sell. I am fortunate enough to have a boss who see’s the value and has given the reigns to me to grow our presence, which has enabled me the flexibility for the company to become the leader in social media within our space.
For those not as fortunate as me, you might find yourself trying to analyze numbers and put down into some magical formula a “dollar value” that can be attributed to a FaceBook fan or Twitter follower etc. It’s not easy, I have attempted the same myself. Being within the retail industry, we can track traffic from FaceBook and Twitter through to a conversion on our site using general traffic source data from Google Analytics, or to be more specific using Google UTM tracking tags. This records quite well a click to sale metric, but fails to record any fans that convert at a later date after seeing something on the social media presence.
The truth is that social media isn’t just about selling, its about building an experience for your customers, whereby they can learn to love your brand and engage with you on a whole different level that by phone or email. But how do you measure that? Answer. You can’t.
You can however, measure engagement, Likes, Follows, Tweets, Comments, Shares etc etc. Again these aren’t necessarily going to convert to a sale directly, but there’s know doubt that they will have an influence on a buying decision when the time comes.
Over the past month or so, i’ve heard a couple of quotes by online marketing professionals pertaining to the ROI of social media, that sum up the topic rather well.
Gary Vaynerchuck (@garyvee) answered the question “What is the ROI of Social Media?” with another question, “What is the ROI of your mom?”. While you may chuckle, he’s right. How could you attribute a monetary value to the role your mom plays in your life?
Paul Castain (@paulcastain) has a different take on the question. “What is the ROI of Social Media?”. “The ROI of Social Media is that your company will still be in business in 5 years time”. I love this, Paul is implying that social media is at the forefront of the marketing field right now and if you don’t get on board you are going to fall behind your competition and eventually disappear. I totally agree.
What’s your take on the ROI of social media? How would you answer the question?