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How To Prove Social Media ROI To Your Manager

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Do you struggle to prove social media ROI to your manager?

Then this article is for you!

At the 2011 500 Inc Seminar, Gary Vaynerchuk told the story behind the famous question What’s the ROI of your mother?

Eight years later, Gary’s take on social ROI, although fun to watch doesn’t hold ground. He says you can measure social media ROI (especially social media advertising, even better than traditional advertising) but you can’t trackback a result to a specific moment or activity.

As this article will show, it is possible to calculate social ROI if (and it’s a BIG IF) you have the right strategy in place. If not, this article is a good resource if you want to do things right.

Let’s dive in!

Social ROI is #2 in Top 3 Marketing Challenges

According to Hubspot’s State of Inbound 2018 Report, proving the ROI of marketing activities is #2 in the Top 3 marketing challenges following generating traffic and leads.

image source: State of Inbound

It’s 2019 and good marketers know better than to measure vanity metrics like number of followers, number of likes, engagement rate etc.

ROI is not about that. ROI is about measuring how much of your brand’s total revenue is attributed to your social media activity.

When it comes to advertising on social media, calculating the ROI is easy: the platform’s analytics provide social media marketers with every data they need.

The challenge is not with advertising, it is with everything else. Because brands are not on social media with the sole purpose of making sales, are they? Social media is much more than that. It’s actually recommended that brands focus more on other brand-related activities than on driving sales.

Let me explain.

Marketing effectiveness expert Les Binet found that marketing campaigns have been delivering fewer results starting with 2012.

The reason?

Brands have been running too many sales activation-based campaigns to the detriment of brand building activities. What Mr Binet also learned is that sales activation delivers short-term sales volume while brand-building campaigns lead to long-term growth and higher sales volumes.

Read this article to discover what Les Binet recommends brands should do: Your marketing campaigns are less effective

How to prove social media ROI to your manager

Social media management dashboard Hootsuite has recorded an on-demand webinar about social media ROI called How to connect social strategy with business goals.

You can save the link to watch Hootsuite’s webinar when it’s convenient for you. Or you can read on to get the main key takeaways.

ROI vs Value

Social ROI is defined as the sum of all social media actions that show tangible monetary return from your investment (eg: eCommerce campaigns).

Social VALUE is a broader view of ROI that attempts to measure more intangible – yet still important – things (eg: brand campaigns).

Both ROI and value are important.

image source: How to connect social strategy with business goals

A successful social media campaign can result in improved customer service, a positive change in brand perception, effective crisis communications, enhanced employer brand and business conversations.

4 brands that are using ASMR in their content marketing strategy

But how do you measure that?

The best way to prove the value of social media is to go beyond vanity metrics and use business-focused measurements.

Ask yourself:

Is social media generating revenue directly?
Is your brand’s purpose on social media to solely generate revenue?

With social media, attributing monetary value might not always be the case (ROI); also another factor you should take into consideration is value.

Here’s how Hootsuite recommends social media managers measure the impact of their activities, calculate and prove social media ROI.

image source: How to connect social strategy with business goals

4 steps to measuring ROI and VALUE

  1. Calculate your true investment in social media;
  2. Set SMART objectives that connect to your business goals;
  3. Establish a measurement framework that fits your unique organization;
  4. Calculate and attribute the impact of your social strategy on revenue and business goals.

1. How to calculate your true investment in social media

To calculate your true investment in social media, look at the following costs:

  • Cost of tools and platforms;
  • The budget allocated to social ad spend;
  • Time spent by employees responsible for social media.

If you feel your company could improve its strategy of allocating resources (time, employees, expenses) you can find here details on three project management tools: Smart entrepreneurship – Stop losing money with these 3 project management tools

2. Set SMART objectives that connect to your business goals

Before you start creating branded content on social media, you need to know why you are creating it.

What goals do you expect to achieve?

Is it brand awareness?

Is it lead generation or sales nurturing?

When you know the business purpose of each piece, you will be able to successfully measure the content’s ROI.

Connect your social activities with specific business outcomes:

  • Business conversions;
  • Brand awareness or perception;
  • Customer experience;
  • Security and risk mitigation.

If you are clear about your objectives, you will find that deciding what social media tactics to execute becomes a lot more targeted instead of broad.

3. Establish a measurement framework that fits your unique organization

Here’s what to do in order to build a measurement framework: set benchmarks and create unique goals.

What kind of benchmarks?

Benchmarks that set the bar for success: the value of social against other channels, the current value of social, and competitive benchmarks.

What kind of goals?

Create goals that specify how and when you will achieve your objectives. Make sure to assign measurable goals: 30 sign-ups a day, 30 downloads a month, 10 lead-generation forms fill-ins etc.

Analyze and optimize

When measuring the impact of social on marketing and sales, choose which metrics to measure, analyze them then optimize.

Don’t dismiss the vanity metrics entirely. They are indicative of your brand’s overall social health. They also help you gain a bigger picture in comparison with your competition. They also tell you which content resonates better with your audience.

4. Connecting social strategy to business goals

To connect social strategy to business goals, you need to measure the right metrics.

Here are 3 metrics that matter the most:

  • content impact,
  • marketing and sales impact,
  • business impact.

Content impact

To measure the impact of your content, look at the number of likes, shares and comments, video views, traffic etc your content receives. These metrics tell you what resonates with your audience at scale. 

Marketing and sales impact

The impact of marketing and sales is calculated by lift, website conversions, leads, goals in Google Analytics etc. They show whether your activities on social are helping you hit core objectives. Also, they help social media managers connect social strategy to business goals and change the perception of social within the organization.

Business impact

Analyze the content, marketing and sales impact and tie them to your business goals. That’s how you show the impact of social on broader objectives such as brand health, revenue attribution, risk mitigation etc.

Business impact also shows where your efforts and resources are being used most effectively and where you can optimize.

Social media ROI and VALUE myths


Have you ever come across any of these myths? If you have, now you know you shouldn’t believe in any of them.

Why? Because they’re wrong!

You don’t start a company and then decide on your business goals. You have to know beforehand. Is it production? Is it services? Which industry? Your decision will afterwards drive future business strategy, business operations, sales and marketing.

Don’t believe in myths! Be a myth-buster!

  • Decide on the business objective that you want to achieve through social;
  • Decide on the tactic and strategy to take;
  • Measure your activities to see if you’re using the right tactics.

4 basic ROI formulas

To get you started, here are 4 basic ROI formulas that you can use.





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