How do you measure the return you’re getting on your social media efforts? Social media marketing is an investment, and like any other investment, you need to be able to demonstrate the value it brings to your organization in hard numbers. During this session, we’ll cover quantifying success in relation to your business goals, tracking & measuring the effectiveness of your campaigns, and tools that can help you report your social media ROI. Presented at Social Media Rockstar Event 2016 - #SMRE2016

2. Image: Rachel Chapdelaine on Flickr

3. Marketing Measurement
Has Come A Long Way

4. The Old Way
Spray & pray
Fuzzy picture of what success looked like
Unsure which marketing tactics contributed to
which outcomes

5. Started Getting Smarter
Coupon redemption codes
Customer reviews & ratings

6. Now We’re Talkin’
Link Shorteners & UTM Codes
Goal Completion
Conversions
Assisted Attribution Models

7. -Bernard Baruch
“If all you have is a hammer
in the toolbox, everything
looks like a nail.”

8. Return On Investment (ROI)
“A performance measure used to evaluate the
efficiency of an investment or to compare the
efficiency of a number of different investments.”
-Investopedia Definition

9. Social Media ROI
The quantitative measurement of social media
marketing in terms of tangible results (results) relative
to the cost (investment).

10. Two Basic Formulas

11. ROI - Return On Investment
(Benefit - Cost) x 100
——————————
Cost

12. ROMI - Return on Marketing Investment
Incremental Revenue
—————————
Marketing Cost

13. If the formula is so easy…
Why do we still struggle to measure social media ROI?

14. Vanity Metrics &
Other General Fuzziness
• Likes
• RTs
• Awareness
• Conversations
• Multiple touchpoints
• Influencer, well,
influence

15. Where’s my easy button?

16. There is no easy button.

17. The Basic Process
1. Choose your goals
2. Track your goals
3. Assign monetary value
4. Measure results
5. Calculate costs
6. Analyze & improve

18. Understand Your Sales Funnel
To accurately measure social media ROI, we have to
understand our sales funnel and our business goals.

19. McKinsey & Company

20. Buffer

22. Possible Conversion Goals
• Make a purchase
• Watch a video
• Register for a webinar
• Click on a link
• Sign up for a newsletter
• Download a white paper

23. Other Types of Goals
• Brand Awareness & Recognition
• Customer/User Loyalty
• Traffic

24. Assigning $$ Values:
Three Methods

25. Method #1: Guesstimate
If you don’t have historical data to analyze,
you’ve got to start somewhere.

26. Method #2: Correlation
Compare your baseline to your social media
activities and look for correlation.

27. Establish Your Baseline
What would happen anyway even if you don’t invest in social?

28. Timeline Your Social Activities
• July 15th: Launched Facebook Page
• July 20th: Launched Twitter Account
• July 25th: First Facebook Ad Campaign

29. Overlay, Analyze, & Prove/Disprove
Note any apparent correlations
Investigate to prove or disprove if they are related
Don’t forget to check for non-social influences

30. Draw Data-Driven Conclusions
Example: During the month of July, we saw a 10%
increase in new visitors to our landing page. Accounting
for our 5% baseline estimate for increased organic traffic,
we can attribute the remaining 5% lift to our Facebook
advertising campaign.

31. Method #3: Use Past Values
Use existing data to calculate the value of
your social media ROI.

32. LTV: Lifetime Value
If you know your LTV, you can work backwards to
determine your conversion value.
Example: Puppy Dewormer

33. Other Measurements
You Can Calculate

34. Conversion Rate
Number of checkouts / Number of unique visitors
(within same time period)
100,000 visitors
2,000 checkouts
2% Conversion Rate

35. Average Order Value
Total revenue/Number of Checkouts
$20,000 revenue
2,000 checkouts
$10 Average Order Value

36. Average Visitor Value
New revenue generated / Number of website visitors
$20,000 new revenue in July
100,000 total visitors
$20,000 / 100,000 = $0.20 per visitor

37. Calculations By Activity/Channel
Using overall site values can only get us so far.
Segmenting social channels, campaigns, and audiences
provides far more accurate data for ROI calculations.

38. Use Your Calculations to
Assign Value to Results

39. Measure Results By Channel
Channel Clicks to Site Value (Return)*
Facebook 2000 400
Twitter 1500 300
Instagram 500 100
*Clicks x Average Visitor Value of $0.20

40. Image: Mykl Roventine on Flickr

41. Calculate All Costs
• Time/Resources/Personnel
• Fixed Costs (Tools, Ongoing Maintenance)
• Variable Costs (Social Campaigns, Integrated Campaigns)
• Management/Oversite

42. Calculate ROI
If you spent $1000 on a Facebook campaign (total cost) and it
resulted in 1,000 new visits, what was the campaign ROI?
In our previous example, we know that each new visit is worth $0.20.
1,000 * $0.20 = $2,000
$2,000 / $1,000 = 100%

43. Calculate ROMI
• Facebook ad campaign cost: $1000 (ad spend + labor)
• July revenue: $50,000
• Incremental Revenue: $2,500 ($50K x 5%)
• ROMI: 250% ($2,500/$1,000)

44. Creating a Measurable
Social Media Strategy

45. Who > Why > What > How
• Scope: Who’s involved?
• Business Objectives & Purpose: Why are we doing this?
• Goals & KPIs: What are we trying to accomplish?
• Tactics & Metrics: How are we getting sh*t done?

46. Who’s (Potentially) Involved
• Marketing
• Sales
• R&D
• Customer Service
• Human Resources
• Technical Support

47. Why Do These Folks Care?
Customer Service Sales Marketing
Reduce call volume Increase qualified leads Improve brand image
Because social media can help each department meet their business goals!

48. Turning Business Goals Into Social
Media Goals
Customer Service Sales Marketing
Reduce call volume Increase qualified leads Improve brand image
Resolve social media support &
customer service inquiries
Drive new visitors to targeted
landing pages
Identify and recruit brand
advocates to build our image

49. Every Objective Needs A KPI
Customer Service Sales Marketing
Reduce call volume Increase qualified leads Improve brand image
Resolve social media support &
customer service inquiries
Drive new visitors to targeted
landing pages
Identify and recruit brand
advocates to build our image
# of posts/tweets resolved
# of conversions from social
media channels
Reach and frequency of
influencer-generated content

50. Value-Driven Social Media Marketing
Now when your boss asks “How’s that Facebook
stuff doing?” you have the tools to demonstrate
tangible benefits to the company.

51. Questions?
@jenjamar
collaborate@jenjamar.com