We shared an incredible infographic that details how a business can measure their social media return on investment. Measuring ROI on social media isn't without its challenges, though. In fact, the lack of the ability to measure the impact of social media has – unfortunately – led to many companies abandoning social media altogether.
Is Your Social Media Marketing Effective?
Measuring the return on investment (ROI) for social media efforts has been a contentious topic with marketers. More businesses than ever are devoting an increasing number of resources to social media marketing, yet many still can't determine whether those efforts are successful. Here are some of the top trends and challenges brands are facing in measuring social ROI. Via MDG
The Top 5 Reasons Brands Struggle to Quantify Social ROI:
- They’re unable to tie social media to business outcomes – Despite tracking engagement metrics, brands can’t see how social posts and shares affect overall revenue.
- They lack analytics expertise and resources – Many marketers are new to social media and analytics tools. There may be a learning curve as marketers adapt to new platforms and begin to allocate resources toward measuring social ROI.
- They’re employing inadequate measurement tools and platforms – While there are many social media tracking tools available today, not every platform will provide the data marketers need.
- They’re using inconsistent analytical approaches – Some marketers are unable to receive a clear picture of their posts’ success due to inconsistent reporting.
- They’re relying on poor or unreliable data -The quality of social data received also matters. For example, social media platforms are littered with fake and duplicate accounts. Activity from these accounts can sometimes affect the accuracy of your data.
While this points to the technology quite a bit, I'd argue that perhaps many marketers simply aren't leveraging social media for what it's really great for. For instance, research for product positioning and marketing. You can research and find a wealth of information about your ideal customer, target audience, target geography, their motivations, their complaints, their challenges, and more. Using that data, you can optimize your strategy and your product offerings to better differentiate yourself and market yourself. How do you quantify that? It's quite difficult to draw the dotted line, but we know that it's worth it.
Another, less popular example. A customer runs into an issue with your products or services and shares their frustration via social media. This provides a public forum to showcase how you support your customers. Some companies even prioritize the issue based on the influence of the customer… but we've watched as more influential people pick up and amplify the issue. Now that frustrated customer, the influencer, and all of their fans and followers are watching.
Depending on whether you hit a homerun or strike out, what's the quantifiable impact on your business? That's pretty hard to tell. As MDG Advertising states with the release of their latest infographic, the ROI of Social Media:
Finding the right approach will take time and effort, but knowing how to track social media’s impact on your bottom line will make the investment worth it.
Here's the full infographic that illustrates how businesses are struggling, what they are able to measure, where marketers are seeing opportunity, and the challenges involved.