In today's digital age, Social Media Engagement is the way of life. From status updates on Facebook to tweeting about your new pair of jeans to connecting with professionals on LinkedIn – We almost live in a 'One button economy'. Businesses across the globe are leveraging on the C2C Era, however one prominent question that almost troubles all is - “I will invest in Social Media, but how do I calculate ROI?” this documents sheds the much needed light on gauging Social Media ROI.

1. customer centria
The Customer Engagement & Experience Company
Decoding the Science of
Social Media ROI
Date: 06/09/2011
www.customercentria.com

2. Introduction
In today's digital age, Social Media Engagement is the way of life. From status
updates on Facebook to tweeting about your new pair of jeans to connecting
with professionals on LinkedIn – We almost live in a 'One button
economy'. Businesses across the globe are leveraging on the C2C Era,
however one prominent question that almost troubles all is - “I will
invest in Social Media, but how do I calculate ROI?”
Social Media and ROI appear in the same statement more
often than ever today. The question is simple – “Is the spending yielding
any returns?” – But the answer is not that straight forward. The issue of
calculating the ROI on social media has plagued marketers and brands for a
long time now. Social media ROI is more than just numbers, as it breaks all
conventional boundaries, augmenting brands and businesses in
unimaginable ways.
A company may choose to spend some thousands, lakhs or even crores on social media – but each organization at
some point shifts its 100% focus on ROI from the activities. ROI can be gauged in two ways here – earnings and
savings. A Cisco case study claims that the firm saved $100,000 by opting for social media initiatives to launch a
product rather than relying on the traditional ways. Gradually, social media is turning into a single promotion
vehicle for many brands, as the returns are high not just in terms of revenue, but reputation management as well.
One negative client response is all it takes to lose hundreds and thousands of potential costumers today, not to
forget the damage it does to the brand. This makes it essential while devising a social media plan to select an apt
ROI as a goal, which is beyond just sales.
Business leaders have no time to waste, and all they seek is a simple calculation of ROI and connect social media
strategies with real world business performance metrics. Tracking mechanisms, virals, sales, surveys, and
hyperlinks – all these form an integral part or ensuring that the returns on social media activities are visible and
easy to calculate.
Starting as mere pilot programs that ran into some weeks, today social media had turned into an every day every
minute affair with professionals dedicated 24*7. So how can companies be certain that the money being put into
social media will surely bear the fruits?
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3. The good news is that you can always calculate and ensure ROI, by keeping
some basics in mind, and implementing the right social media strategies.
Social media should always add the human aspect to brand, as the goal is to evoke trust. Trust is all about
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brand loyalty, so the aim is to strengthen the client association.
Monitoring social media is essential; it's the initial baby steps your social mediums take that shape the
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destiny of your future online conversations.
Encourage word-of-mouth, as social media is becoming the primary source of business marketing today.
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Your customers and clients recommend products, services and brands – wherever whenever – in office,
at home and even on the move.
Online reputation management is the word – supported by right monitoring of the social presence of
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your brand. This holds the key to create buzz about your brand online.
Your clients and users are reading, talking and leaving their marks online everywhere. They can be
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existing or prospective customers, but you don't want them to feed any negative byte to the Internet
about your brand.
UGC (User Generated Content) is the in-thing, and costs come down automatically. When your clients
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and consumers participate in your online initiatives, companies receive substantial impact and support
in brand management and reduction in marketing costs and at the same time, they are more trusted
amongst fellow users because it is created by someone from their own community.
Engaging the consumer is of highest value as it serves two purposes – cost reduction and direct access to
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his priorities. Create an interactive game or start a contest – you will get a piece of your consumer's mind.
And you can achieve a lot by putting all the pieces together! The other plus is that you will also get in touch
with some creative minds out there who can take your brand places with some brilliant ideas. How about
that for ROI?
Leverage each of these points, and you will never have a moment of doubt about social media ROI, as it gets
maximised with each day, apart from enhancing client retention and acquisition.
There are multiple ways to measure the benefits of social media and smart tracking and measuring is essential
to capture the effect of a campaign or any other initiative. Social media ROI can come in any form:
Direct monetary return (Of Course)
Repeat traffic and Customer loyalty
Creation of a positive brand buzz
Idea sharing for growth through online interactions
Global brand exposure
Significant cost reduction
Community Building and the list goes on….
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4. An important aspect here is 'defining you success metrics', which essentially doest just mean how many people
clicked “get more info” or how many people retweeted your content. Metrics must cover two major aspects:
Quantitative (Eg: Subscribers, leads, revenue, etc.)
Qualitative (Eg: Feedback, Interaction, Loyalty, Buzz, etc.)
Keeping in mind the objective of Social Media Presence and setting the right metrics to gauge the results achieved
is the key to ROI measurement. The debate over ROI has inspired many brands to take the rational approach to
social media – one based on information, data and resolve.
To Conclude, before the 'I' in ROI sounds like 'Ignorance' and not 'Investment', it's time to take charge and
design social media plans based on logical and rational ROIs, relevant to your specific brand and services. Thus,
it's not always about revenues, buzz, optimisation or acquisition... its more about 'Humanisation'!
About Customer Centria Enterprise Solutions Pvt. Ltd.
Customer Centria is a Global Customer Management Company headquartered at Mumbai with offices across 5
locations around the globe and enables enterprises to design Customer Experience and Engagement strategies,
powering them towards customer-centricity. Customer Centria helps create opportunities for brands to interact
with customers enabling delightful experiences throughout the engagement lifecycle. Customer Centria offers a
complete bouquet of services from marketing automation, analytics & insights, interactive marketing, virtual
experiences to loyalty management. Customer Centria has proven capabilities across verticals with tailor made
services for sectors such as Banking, Financial Services, Insurance, Retail, Telecom and Consumer Goods.
www.customercentria.com