Determining the Return On Investment (ROI) of your brand’s social media activities is a complex multi-headed beast but there are various key factors which can indicate whether your social web presence is trending upwards or augering in. These seven ROI determinations will help you figure out if you’re climbing to the sky or crashing to the ground.
- Reach determination. The first determination is to figure out your total reach. This bit of math is simplicity itself: People who shared content x Their friends/followers = Your potential reach. Therefore if you have 1,000 followers and they’re all sharing content with an average of 100 people each you can then expect your potential reach to be 1,000 x 100 = 100,000. Note that this is an extended and theoretical number as no brand will ever realize its full potential reach.
- Value of each fan. When it comes to determining the value of each one of your individual followers the math gets just a tiny bit more complex but still well worthwhile calculating: The total dollar value of the transactions resulting from social media interaction / Actual reach = The value of a fan. Therefore if you’re grossing a million dollars a year from your social media activities and your actual reach is 100,000 then the value of each fan is $10.
- Share of voice. How many times is your brand being mentioned on social media chatter as compared to your competitors? This calculation will allow you to determine how effectively you’re achieving your social media goals versus the competition, and can easily be weighted by market share or volume. Therefore if your competitor has four times the market share but is only generating double the share of voice that you are, you’re doing twice as good a job as they are!
- Interaction per post. This calculation is simply the number of comments or replies you receive on each of your initial updates, posts or tweets. So if you take all your Facebook posts for this year or month or even on an individual post basis and calculate them according to the number of comments you’ve attracted you’ll obtain this critical figure. Just like a bank account, more is better so you should carefully dissect the posts which have had the best result and emulate them in your future social media efforts.
- Key influencer mentions. Not all social media mentions are equally effective. The ones made by key influencers who not only have large groups of their own followers but are also able to command powerful loyalty and respect from their networks have a considerably greater effect on your social media success. Tracking these key influencer mentions and doing everything in your power to increase them will do your social media campaign a world of good.
- Sentiment analysis. While the social web does seem to act on the basis that there’s no such thing as bad publicity, it is important for you to track the positivity or lack thereof of your comments. If your brand is being slagged in 90% of your responses then the sheer numbers you’re attracting may actually be counterproductive. You should consistently strive to minimize the number of negative and even neutral comments in order to boost the positivity rating of your sentiment analysis at all times.
- Social clickthrough. In many ways this is the Holy Grail of social media ROI calculations as it’s what we all want our followers to do: Click on the link! While the sheer number is of course important, the trend is even a more impactful factor on the overall success of your social media marketing campaign. If you’re showing growth in the number of clickthroughs then you can rest assured that you’re on the right track. If your clickthroughs are dropping, then it’s time to start fixing what’s broken.
While succeeding in all of these seven social media ROI determinations is not necessarily the ultimate key to bottom line success you can be sure that if you’re failing at the majority of them your social networking efforts will be categorized as a bust!
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