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The Way You Calculate Social Media ROI Is All Wrong

If you're focused on followers, likes and click-throughs then it's time for a new approach.

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If you're focused on followers, likes and click-throughs then it's time for a new approach.

Guides

The Way You Calculate Social Media ROI Is All Wrong

If you're focused on followers, likes and click-throughs then it's time for a new approach.

Share this article

What data did you refer to the last time you needed to calculate the ROI of your social media efforts? If you focused mainly on the number of new followers and shares you got, you could probably benefit from looking a little deeper.

With many marketers reporting with a top level mind set, it’s unsurprising that only 34% of businesses believe their social media activity has a direct influence on business results.

Lead generation can, and should, be one of your social media goals; not only will it force you to think about how you should structure and measure your campaigns more effectively, it will make it easier to justify the time and resources your activities will require.

To demonstrate how your social strategy is boosting the bottom line, you need to set the right goals and KPIs and measure the right data.

Here are six ways you can better attribute your social media leads to business performance:

Measure how engaged your social audience is

Taking your click-through rate + bounce rate in comparison with other traffic sources can be a helpful way of proving the value of your social media efforts.

If your social media bounce rate is lower than sources such as Google or display ads, you can infer that your audience is more engaged and that the traffic it drives is valuable to the business.

If you are sharing content from your company blog, for example, you might expect a high bounce rate as visitors will tend to be repeat users looking for your new content.

However, if your website content is engaging enough, a new visitor will ideally be driven to want to read more pages and posts, find out more about your company, or make a micro conversion such as signing up to your email newsletter.

If your data isn’t telling you a positive story you should use these insights to help you improve your social campaigns and website content until it starts to surpass other channels.

followers

It's not just the number of followers you have, it's how they act that's important

Measure social’s share of traffic

Don’t be put off if other channels drive a lot more traffic than social; take a look at the share of traffic that social media is driving to your website.

For example, if social media brings in a good percentage of traffic in a month, and comes ahead of a number of other channels, this will illustrate the true impact of your efforts.

Again, keep tweaking and experimenting with different social media tactics until your stats are impressive enough to show your boss.

Attribute monetary value to non-ecommerce conversions

A monetary figure is much more valuable to your business than simply showing the number of leads you brought in, but not all leads spend money with you right away.

You can properly attribute a value to the social media leads who don’t spend any money by setting up Goals in Google Analytics.

You’ll want to create goals that trigger when a particular destination URL is reached by a user, such as the ‘thank you’ page once someone has completed the contact form or signed up to your newsletter.

To assign a monetary value to these non-ecommerce goal completions you’ll need to have Ecommerce tracking set up in your Analytics or access to sales details from your accounts team.

For example, if a visitor from social media signs up to your email newsletter you would need to know the value of newsletter subscribers to your company based on details such as how many subscribers convert, how often they visit and what their average order value is – here's a handy guide to working this out.

You can also track conversions on your webpages that don’t necessarily lead users to a destination URL; this is called Event Tracking and can be used for actions such as watching a promotional video.

mcommerce

Leads from social media might not spend money right away

Track your users’ journeys to drive them to conversions

You can set up Funnels for Destination Goals in your Analytics software to evaluate whether your social media visitors complete your desired actions and become a lead by following a predicted journey.

For example, your predicted or desired lead path could be as follows:

Social media > blog post > newsletter signup > destination URL ‘thank you’ page

However, when you review your goal funnels and behavioural flows you might discover that the majority of users are following the path below:

Social media > blog post > ‘about us’ page > exit website

This would indicate that social media visitors are interested enough to investigate who you are, but are either not sufficiently impressed to hand over their email address, or are not being prompted to sign up to your newsletter once they land on your ‘About us’ page.

This gives you the opportunity to improve your content and experiment with some new CTAs that are likely to influence your social media visitors into completing the actions you want them to.

Track your social leads to attribute sales

It’s not enough to use your Analytics software to see how many leads social media is bringing in; you can get even more granular than that to prove your efforts are paying off or identify areas for improvement.

For example, if you run a children’s toy shop competition, it gets pretty fierce over the Christmas period, so you might want to boost your marketing efforts during this time.

When it comes to increasing your social media activity, how do you identify the traffic that comes to your product page as a direct result of your Christmas campaigns over your general social visitors?

To do this you should be using utm codes in every link you share, these allow you to tag campaigns right down to individual posts using values such as source, medium, keyword and campaign name.

This then accurately tracks and attributes everyone who visits your website and becomes a lead via each link – whether it’s right away or later on.

microscope

By taking a forensic approach you can find out which maketing materials work best

You can generate links with utm coding using tools such as Google’s URL builder if you’re new to the concept and you can tidy the links up for your social campaigns by using URL shortening services like bit.ly.

By doing this you can track the origins of online purchases so be sure to have Ecommerce tracking set up in your Analytics software.

All is not lost when a lead moves offline

For businesses offering services where website visitors may wish to speak to a sales representative over the phone, it’s possible to further attribute your social media leads by making use of call tracking software.

Providers such as Mediahawk are able to generate unique telephone numbers for your website visitors to call, which allows you to trace leads all the way back to the links through which they entered your website.

Call tracking comes in even more useful when you use social media features such as direct social purchasing.

By assigning a different phone number to each social network or even each individual social promotion, visitors will see the same phone number on your website that appeared in the campaign that referred them.

Not only does this give marketers the ability to report the ROI of their campaigns, but provides real-time insight meaning they can identify their highest-performing campaigns which allows them to fine-tune messages that in turn drives revenue.

If you’re new to social media lead attribution it may be difficult to come up with a measurable goal for each metric.

However, tracking your metrics over time, and continually reviewing your KPIs, will allow you to make your goals more realistic as well as see how well your strategy is or isn’t working.

A huge number of businesses fail to utilise Analytics in social lead attribution, but data doesn’t lie and it can help you identify where your strategy needs improvement while proving the true value of social media to your bottom line.

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The Way You Calculate Social Media ROI Is All Wrong

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