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Owing to the lack of KPIs for social media channels, businesses have struggled to define the metrics to measure return on investment. Although, measuring ROI of any communications effort is relative to the aims and objectives of your social media strategy, there are plenty of universal metrics applicable to the social channels.
This post highlights a few important metrics which help in formalising a marketing strategy for social media.
I have attended a number of digital and online marketing conferences and have witnessed a good deal of presentations by experts on social media marketing. A number of these presentations have devoted significant amounts of time to explain the quantification and measurement of social media channels from a business perspective.
Clearly, social media channels do not immediately present themselves with a clear return on investment which makes it tricky for businesses to adapt a fully integrated social media strategy.
While the interest in participation grows exponentially, marketing managers are forced to quantify the investment into social media channels. I was present at Bigmouthmedia and Econsultancy’s Social Media Summit recently, which witnessed the launch of the Social Media and Online PR Report.
During the event, there were a number of references to businesses which are in the vanguard of creating social media models and have excelled in reaping the benefits. For businesses which have been skeptical, there are a few reasons why incorporating a social media channels can help their long term goals.
Social media can help strengthen the company’s brand perceptions among its stakeholders. Discovering measurement metrics for social media is a bit tricky as effective quantification challenges the traditional approaches of measuring return on investment.
Ever since Dell announced that its revenue from social media alone accounted for $6.5 million, it has remained the poster child for Social Media success. However, if you were to look at Dell’s overall revenue, which was recently announced as $60 billion, $6.5 represents an extremely diminutive share, but, important nonetheless.
So the key question here is how do you measure ROI for social media? Can this be associated with a monetary value?
The social media realm itself is extremely vast. From the earliest days of Delicious to the very recent Apple Ping, everything has been invented and re-invented to entice classes and masses. While some platforms have been pursued for creative interests, almost all platforms have gained commercial emphasis due to participation of businesses.
So rather than focus on every individual social platform, let’s look at some important metrics for a few prominent platforms in use today, which could eventually lead to a propitious ROI. Alternatively, you could mark these metrics as the ROI for each individual channel.
Each of the highlighted metrics from the table above, are easy to quantify and establish and objective for. Based on these objectives, businesses can craft a strategy specifically to develop social media channels, which reinforces the company’s image gradually.
In summary, we might not see an increase in market share for a business due to an overwhelming social media presence, but on a long term, social media provides an opportunity or a platform where you can stand and deliver clear but concise messages about the brand.
How creative a business is while delivering these messages defines how lasting an impression it leaves among its customers. Eventually, it is on this impression, businesses gain an advantage to build those brand perceptions and awareness which can help to galvanize and sustain growth. ROI does matter for social media.