Few phrases can strike horror in the hearts of modern marketers like, “social media ROI.” And we all know why: A return on investment metric for social media is difficult to define, even harder to measure accurately, and dangerous to use in decision-making. Social media is all about building relationships, not focusing on graphs and numbers – and it doesn’t matter how often you say it, there’s always someone who wants to bring it back around to bottom line ROI.
Trust us, we feel your pain. So to help out, we’ve collected a few “things to remember” that you can repeat to your boss, your coworkers, or yourself when social media ROI starts to loom.
We live in a world that’s all about results, results, results. Social media does produce results, but they are long term in nature. They focus on quietly rising interest, accumulation of loyal fans, soft pushes toward conversion, and many factors that are intangible in the short term. In short, don’t panic when numbers change from month to month, because that’s not the game that you’re playing. Look at your business a couple years ago vs. now, and see what’s changed – that’s where social media shines.
This concept is troubling, especially to B2B decision makers, but revenue and loyalty don’t have the same connection on social media as they do in the real world, typically because metrics don’t tell the full story. For example, you can have 10,000 followers on Twitter that interact with every bit of content you post…but rarely if every buy anything from your company. Or you could have a dozen Twitter followers who are big-ticket clients and spend an enormous amount of money on orders, even if they rarely respond to your Twitter posts. See the disconnect? One isn’t a good measure of the other.
Profits and losses are zero sum: If one goes up, the other goes down. Accounting is zero sum: When you move something to one column, you deduct it from another. Social media is not zero sum – and here the brakes start squealing. There are efforts to make social media into a zero sum formula, but they are questionable at best, because it just doesn’t work that way. You’re not adding and subtracting from any re-defined resource. You’re working with people, engaging in conversations, and trying to create common benefits.
Do you want to drown your social media game? Then make it all about the numbers. Brands that push conversions and signals as the primary goal of their social media programs tend to disappoint fans. People don’t go onto social media to be gamed, and they are very sensitive to efforts along those lines. Genuine outreach and engagement plays much better.
Too many decision makers have one eye furiously bent on their competitors no matter what decision they are making. Here’s the problem: Your social media is not dependent on what competitors are doing, or vice-versa. Trying to get “higher” numbers than competitors is a completely unreliable goal in this field, because it doesn’t really mean anything.
Buffer has a great post on how ROI depends greatly on perspective, and we suggest you take a look at it. Basically, your ideas of value and your audience’s ideas of value don’t always match up – and shouldn’t.
All right, here’s one for the bosses who won’t get the message and insist on ROI no matter what. You can measure social media this way, but it takes work to make it useful. Affinity ratings, for example, try to measure positive interactions per social media object, and are more applicable than most metrics. If you are only interested in budgeting at the moment, make sure you have a way of tracking leads through social media so you can measure cost per lead. Also keep an eye on trackers offered by social platforms: Facebook’s Pixel is currently the best example here, but other platforms are working on their own tools as well.