3 Ways to Explain Social Media ROI Beyond Dollars and Cents

If you’ve worked in social media or have looked into using social media as part of the marketing or PR strategy for your business, surely you’ve run into the this age-old question: What’s the ROI for social media?

Business owners and decision-makers are expected to make the best decisions for their companies, and, oftentimes, they have to tie efforts they’ve invested in back to an ROI amount for the company’s bottom line. That’s understandable. But, how do you relate ROI back to a service that doesn’t necessarily produce a return in terms of dollars and cents? And, how do you explain to your bosses, business partners or investors that ROI can be achieved in terms other than cold, hard cash?

It’s a dilemma we face all the time at Envoy. Here are three ways I help our clients see and understand social media’s benefits.

1. Explain where social media fits in your marketing funnel.

Let’s start out with some of the myths you’ve probably heard about social media marketing:

“Social media is a cheap way to get leads.”
“All you need is social media to make sales.”
“Social media is the No. 1 way to close.”

Now, let’s talk truths. First, social media shouldn’t be seen as “cheap.” It can be cost-effective, but it takes just as much work and strategy as other types of media. Building a social following and increasing brand recognition also take time. Your business needs to gain the trust of online audiences over time, just like it has to win consumer trust in the real world.

Second, you know your business better than anyone else. You know your markets and who your target audience is. You also know what kind of numbers you need to make a profit. Social media is a part of your marketing mix — generally a top-of-funnel tactic. If your decision-makers think sales are going to explode through the roof just because you have a Facebook page, they’re going to think that your social media efforts are a flop when they very may well have been successful. The key is managing their expectations.

Any successful business gains traction through integrated efforts in marketing, not by betting all their hopes on one tactic.

Here’s an example of how we’ve successfully combined social, digital and traditional tactics for impressive results.

2. Set specific goals. Very specific goals.

Let me say this louder for the people in the back: Be. Very. Specific.

Don’t say you want brand awareness. That’s fluffy and ambiguous — and is there any business that doesn’t want brand awareness?

Instead, try using these approaches:

Don’t Say: We want brand awareness.
Do Say: We want to reach x number of people this month. We want this ad to reach x number of people with a frequency of no less than x amount.

Don’t Say: We want to grow our audience.
Do Say: We want to expand our audience growth by x percent per quarter.

Don’t Say: We want people to engage with us!
Do Say: We can expect x number engagements or an x percent engagement rate for this content type.

Using ambiguous terms like “reach,” “growth” and “engagement” might be a difficult sell for those looking for a hot lead, easy close or quick ROI, but if you can attach specific metrics to your very specific goals, then you’ll prove success to the decision-makers, and you’ll be able to use that success to show social media’s value.

3. Track your goals regularly.

Without context, numbers are just numbers. But if you track your metrics over time and align them with qualitative info about your business and other efforts or campaigns that were running at the same time, you’ll start to see trends and be able to tell your own success story with the data to back it up.

Do you have questions about social media and how to make it work for you successfully? We’re no strangers to customized social media plans. In fact, they’re our forte, and we’d love to help you with yours. Contact us for a free consultation.

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