Social ROI: Measure What Matters

Measuring the return on going social can be difficult for businesses, for a variety of reasons. Typical challenges include:

  • A lack of agreement or understanding about how social media supports business goals
  • Uncertainty around the best metrics to use
  • A growing number of social media accounts
  • Monitoring and measurement tools that don’t fully meet user needs

Later posts will address the issues of measuring proliferating accounts and the tools to measure them, but this post will focus on determining what to measure.

Let Business Objectives Guide Your Social Media Use & Measurement

First, your social efforts should be based on a clear strategy to achieve certain business objectives. Why are you using these marketing channels and tactics? An Altimeter Group report found that 70% of businesses believed social media could meet business objectives, but only 43% had a formalized strategy for how social would meet their specific business goals. Don’t be part of the 43%, be clear about what you are trying to achieve and be ready to show the ROI on your programs.

The Social Media Measurement Compass (see below) from Altimeter Group provides some of the most common business uses for social media, including:

  • Brand Health
  • Marketing Optimization
  • Revenue Generation
  • Operational Efficiency
  • Customer Experience
  • Product or Service Innovation

Social Medi Measurement Compass

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Measure What Matters for Your Business Objectives

Your business goals will impact not only what social media you engage in, but also how you measure your social media programs. Some examples are provided in the table below.

ReasonArea to ExploreWhat to MeasureInsights to be Gained
Understand your company’s brand healthConversation andSentiment Drivers
  • Sentiment over time Source of positive, negative and neutral sentiment
  • Highest-performing topics, brands, regions
  • Number of fans/followers, brand mentions
  • Top keywords
  • Top shared, liked, RT’ed
  • How people feel about your brand
  • What words or qualities they associate with it
  • Where conversations occur
  • Conversation drivers
  • Frequently shared topics


Gather Innovation InsightsIdea Resonance
  • Number of ideas (volume)
  • Sharing of ideas (RTs, likes, shares)
  • Acceleration and reach of idea topics over time
  • Which ideas gain most traction/resonate most strongly?
  • Customer requests in context
  • Perspective on popularity of ideas
Measure call center savingsCall Containment / Deflection
  • Percentage of inquiries that were resolved in social channel; i.e., did not culminate in 1–1 chat or call center call
  • Potential cost savings from contained (deflected) calls
Determine revenues driven by social mediaRevenue Drivers
  • Leads by channel
  • Conversions by channel
  • Sales by channel
  • Visit loyalty
  • [Stated] intent to purchase
  • Revenue by review rating
  • Revenue by product by channel over time
  • Revenue derived from social channels compared to direct revenue
  • Effectiveness of social channels for conversion and revenue generation
  • Whether the social experience influences purchase behavior

You’ll notice that there are both non-financial and financial metrics listed in the table above. Return on Investment (ROI) is just one metric businesses should use to evaluate their social media programs.

But Be Prepared to Measure ROI

Nonetheless, at some point, in order to articulate the strategic business value of social media to the company, you will probably need to show a positive ROI.

Social Media ROI Measurements

As an eMarketer article points out, only 25% of marketers are measuring sales associated with social media. “In 2012, marketers will need to focus more sharply on hard metrics to gauge digital and social marketing ROI. They will be pushed in this direction by economic and competitive forces, and by rising expectations from internal stakeholders.…”

In other words, you will need to show that the programs either:

  1. Increase Revenue or
  2. Reduce Costs or (preferably) Both

The pyramid below shows how social media programs and metrics can demonstrate ROI and support a company’s business objectives. It shows how, by resolving customer service calls via a social channel, a company may be able to reduce call center volume and its costs of handling service requests, thereby reducing its operating costs and improving its financial performance.

Social Media Ties 2 Biz Objectives

Whichever metrics you choose, focus on results-oriented rather than just action-oriented measures. As the Altimeter Group says, “Every metric should pass the “So what?” test in the context of your business goals. If you can’t answer “So what?” to your metric, question the value of measuring it in the first place.”

You’ll find a more complete listing of metrics by business objective in the Altimeter Group Report, A Framework for Social Analytics.

How is your company focusing and measuring its social media efforts?

special image thanks to Get My ROI

Discuss This Article

Comments: 2

  • What a great article Jill! Return on investment (ROI) is very important to businesses, especially their marketing department. Companies don’t want to waste their money on a form of marketing that is showing negative ROI or is simply too difficult to measure. Sometimes social media is not used to its full effect because it is hard for businesses to measure the true ROI that it’s creating. As a Marketing Director at Cisco, I have found a way to deploy social and digital media with conferences and events and gain a noticeable ROI from it. By live streaming videos of conferences and events I have created an interactive community in which users can discuss latest trending topics and conferences themes. This boosted participation and interest engages the user before, during and after an event. With the event still in the user’s mind after it over, eliminates the possibility that the event is a “one hit wonder.” This is the type of return that companies want to see from tradeshows, conferences and events. Thanks again for the informative post, Jill, I hope to see marketing departments use true marketing ingenuity to incorporate social and digital media into their marketing campaigns and see measurable returns!

  • Jennifer – thank you so much for your comments and “live” example of how you are integrating and measuring your marketing efforts at Cisco. Thanks for writing about how you are making the most of events since we tend to get focused on online marketing and sometimes have trouble linking it with offline marketing. Keep up the good work at Cisco!

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