Marketers are continually under pressure to show return on investment for marketing spend and predict what results a tactic or level of spend will deliver. This is of course key to deciding marketing budget allocation, but how do you measure ROI when it comes to organic social media activity?
Often the ROI of organic social media comes into question. Measuring the effectiveness of organic social media marketing may not be as clear-cut as when running a paid social media campaign. You may not be able to tell how much revenue a social media post brought in, but you can still measure ROI based on the success of that activity.
Setting KPIs for organic social
It is important to think about what the objective of a marketing tactic is. Does the issue of organic social media ROI lie with the measurement of success? Like any other marketing tactic, you need to set an objective and decide a measurable outcome or KPI, as well as a timeframe in which you want to achieve these goals.
The objectives will ultimately dictate your KPIs and which measurement of success you use. For example, if your objective is brand awareness then KPIs based on vanity metrics such as audience growth and engagement would be an appropriate measure of success. But these measurements aren’t the only thing that organic social media can be attributed to.
What is the purpose of organic social?
Organic social media serves a range of purposes within the buyer journey and the core focus of the tactic is often brand awareness, but activity can support other stages within the marketing funnel (Link to social media marketing funnel blog). If awareness is not the objective then in order to secure budget for organic social media it is likely you will need to know what your company is getting back from the budget, time and resources that will be used. In that case, you need to think about the metrics across the customer journey and producing content that is appropriate for each stage in the marketing funnel, from top to bottom as well as how it can work with other channels to help to secure leads.
Organic social media helps to support paid social activity and vice versa, when done right it can even lessen the reliance on paid media.
The impact of organic social
It is clear that organic social media contributes to buying decisions! An American University study found 75% of B2B buyers were influenced by information they found on social media, so the tactic is surely vital to the success of your marketing strategy! With this in mind, how can you measure organic social acquisition?
In order to effectively measure ROI you need to know your costs and also the value you assign to your social media goals. Then, using these simple equations used by the likes of Sprout Social or Buffer, you can reach the desired monetary value or ROI data:
ROI = (return – investment) / investment
Ratio between gain and cost
When calculating ROI based on ratio gain and cost, gain refers to customer actions to which you can assign a value; sign-ups, downloads, page views etc and costs refer to training, technology used, agency fees, time and resources. When estimating the gain from desired actions you need to look at analytics to determine which conversion events can be attributed to social media.
Setting your KPIs for organic social
In order to get to this stage, follow these simple steps:
1. Select your objective
● Improve brand awareness
● Manage brand reputation
● Generate leads
● Improve customer experience
2. Define your social media goal
This needs to have a measurable action:
● Number of new followers
● Website visits
● Time spent on page
● Response time
● Engagement rate
3. Track your goal
To measure success you must be able to track your goals. There are a variety of tools for tracking and some social tools and platforms even have this functionality built in:
● Google Analytics: set up goals, track website traffic, monitor conversions attributable to your social media campaigns
● UTMs: add a further level of tracking by adding UTM parameters to URLs to track at a more granular level, to an asset or post level
● Social media platforms: access engagement, clicks, impression, reach and audience data
4. Assign a $ value to your goal
There are a number of different ways to assign a monetary value to your social media activity:
● Customer lifetime value – LTV = the projected revenue that a customer will generate during their lifetime. This can then be multiplied by conversion rate to establish how much each customer action is worth
● Google Analytics = you can assign a value to the goals that you have set up
● Ad costs = If you were to run ads to achieve the goals how much would that cost?
This level of tracking and reporting can help you demonstrate ROI and establish where best to concentrate your efforts. Ideally, a community manager should be in platform or checking the reporting function of your social media or tracking tools regularly. Reporting data needs to drive future content, social media content needs to be adapted based on success to achieve goals.
Other benefits of organic social
There is a range of ways organic social media can benefit your brand:
● Ability to talk directly to customers
● Ability to test responsiveness to a particular topic or message without the need for significant investment
● Crowdsource valuable insight and information from your customer base
● Support any word-of-mouth (WOM) marketing that you might have in place as prospects will typically visit a brand’s social profile in order to understand what their customers think of them
● Build trust between business and customer – you are learning about each other simultaneously, learning each other’s values through what is posted and shared
Organic social still has a critical role to play in your marketing strategy but it is important to make sure that the platform and content is right for your audience and your business objectives!
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