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Companies are still grappling with the issue of measuring social media, though fewer are reporting that they are unable to measure ROI (37%) compared with 47% last year. 

For our State of Social 2011 report, produced in partnership with LBi and bigmouthmedia, we asked more than 1,000 online businesses about the challenges of social media measurement. 

Here's a few highlights from the report...

Understanding of social media ROI

41% of company respondents report that do not have an ROI figure for any of the money they spend on social media marketing, while 26% say they can attribute an ROI figure to a tiny amount of the money spent on social media.

Just 8% can determine ROI for all of their social media spending

For how much of the money you spend on social media do you have an ROI figure?

But is ROI the be-all and end-all? PR consultant Stuart Bruce has an interesting take on this issue: 

It‘s a reflection of the immaturity of social media that some people are still obsessed with the notion of measuring ROI, when in fact they don‘t have any true or accurate means of measuring ROI across most of their business activities – but because those are mature and have always been done don‘t face the same level of scrutiny.

While 37% aren't able to measure the value of social media, 19% say social media is more worthwhile than other marketing activities, 20% report it is less valuable, and 23% indicate that ROI is similar to other marketing activities.

These findings echo those from an Adobe survey released last month, which found that 78% of European marketers were unhappy with social media measurement. 

What metrics are being used to measure social media? 

The three most important social media metrics, according to our respondents, are direct traffic from social sites, brand awareness, and customer engagement

The top three metrics have little to do with ROI, while sales is considered to be a less important metric than you might expect. Just 15% felt this was important, though 29% cited this in last year's survey. 

Which are the most important metrics when assessing social media activity for your organisation?

As Econsultancy's Chris Lake notes in a post on social media measurement, "the key to measuring social media is to track all of the usual ‘hard’ metrics, but it’s also to step back and correlate performance against the major business KPIs".

How much traffic you can generate via social media is certainly worth measuring, but companies mustn't become too fixated on this, as there are other, perhaps more valuable, social media metrics. 

Other findings from the report

Bigmouthmedia has put together this infographic which contains some key stats from the report which was launched at the agency's Social Summit event earlier this month.

Despite measurement issues, 79% of companies are still planning to increase their investment in social media over the next year. 

Graham Charlton

Published 18 November, 2011 by Graham Charlton

Graham Charlton is the former Editor-in-Chief at Econsultancy. Follow him on Twitter or connect via Linkedin or Google+

2565 more posts from this author

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Niall Cook

Am I the only one to find it extremely disturbing that driving traffic from social networks is considered *by far* to be a more valuable metric than other tangible and intangible business KPIs like sales and brand value?

Perhaps one of the reasons that marketers are so unhappy with social media measurement is that they have yet to understand the difference between monitoring, management, measures and metrics.

For me, social media measurement is all about context: who you're measuring yourself against; what your objectives are; and how you connect your measurement to things that the C-suite actually care about (and I bet you that ain't web hits!).

Niall Cook, advisor and co-founder, Sociagility

over 4 years ago

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Nick Stamoulis

40% is a large percentage of companies that have no social media training. That is part of the problem with social media. Businesses know that they should be involved, so they just jump in without a strategy or any tangible goals. Without goals, it's impossible to measure success.

over 4 years ago

Graham Charlton

Graham Charlton, Editor in Chief at ClickZ Global

Hi Niall. Yes, though it may just be that it's the easiest thing to measure. Take a look at this post for more on this: http://econsultancy.com/uk/blog/8311-are-you-measuring-the-right-social-media-metrics

over 4 years ago

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Niall Cook

Hi Graham. Yes, I think you are probably right.

over 4 years ago

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Steve @ Wise - Facebook Analytics

Like the comment of Stuart Bruce, so true!
Would like to see the same attention to metrics on other media too!

over 4 years ago

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Alex Wares

Picking up on the quote by Stuart Bruce, I disagree that "It‘s a reflection of the immaturity of social media that some people are still obsessed with the notion of measuring ROI..." Across traditional media and PR it is true that there has historically been a paucity of reliable metrics upon which to judge ROI(unless you include spurious metrics such as AVE). The critical point is that with a digital media marketers have come to expect to be able to calculate with reasonable accuracy the ROI from an activity. That there is not as yet a general consensus on how to reliably judge ROI from this channel is what causes frustration and uncertainty and hence those in control of budgets are quite rightly scrutinising the channel.

over 4 years ago

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