{"id":3456,"date":"2016-06-21T23:19:54","date_gmt":"2016-06-21T23:19:54","guid":{"rendered":"http:\/\/postcron.com\/en\/blog\/?p=3456"},"modified":"2018-02-07T20:43:16","modified_gmt":"2018-02-07T20:43:16","slug":"calculate-social-media-roi","status":"publish","type":"post","link":"https:\/\/postcron.com\/en\/blog\/calculate-social-media-roi\/","title":{"rendered":"How to calculate Social Media ROI in 5 simple steps: know if your actions on social networks are generating returns (formula included!)"},"content":{"rendered":"

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Social Media ROI<\/strong> is like beer: many years can pass by without knowing about its existence, but once you fall into its trap there’s no one to stop you.\u00a0<\/strong><\/p>\n

Ignored by many, discussed by others and loved by the fortunate few who know how to measure it, learning to calculate the ROI of your actions on social media can open the doors <\/strong>to paradise where you\u2019ll live happily with a successful business.<\/p>\n

And although social networks have this amazing power to make your business grow with the creation of a Facebook or Twitter profile it\u2019s not sufficient enough to track actions, costs and results. <\/strong>\u00a0And this is where Social Media ROI, or Return on Investment,<\/strong> comes into play.<\/p>\n

So, you\u2019ll want to know what Social Media ROI exactly is because you have to measure it <\/strong>and know how to calculate it, <\/strong>and to ensure that your actions on social networks are working up to their potential you only have to do one thing: keep reading. <\/strong><\/p>\n

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What is Social Media ROI and why should you measure it? <\/strong><\/h2>\n

There\u2019s an unflinching rule in the digital marketing world:<\/p>\n

If you don\u2019t measure the results of your actions, you\u2019ll never know if they\u2019re working.<\/em><\/strong><\/p><\/blockquote>\n

This is precisely what Social Media ROI or Return On Investment <\/em>deals with:\u00a0knowing how effective your campaign is on social networks. <\/strong><\/p>\n

To explain it in layman\u2019s terms,<\/p>\n

ROI on social networks is a percentage that we calculate based on the returns and profits obtained through our actions on certain social platforms <\/strong>in order to know what our return rate is.<\/p><\/blockquote>\n

In other words, Social Media ROI has the important job of helping you find the economical performance of an investment <\/strong>in order to evaluate how much money each dollar invested has generated during a determined campaign. <\/strong><\/p>\n

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Thus far it may all seem quite logical, but the reality nowadays is that 40% of companies don\u2019t know whether their efforts on social networks are successful or not, <\/strong>according to a study done by Convince & Convert.<\/a><\/p>\n

Not only this, but pointed out by another study done by \u00a0Domo<\/a>:<\/p>\n

3 out of 4 digital marketing experts don\u2019t know how to measure Social Media ROI<\/em><\/strong>.<\/p><\/blockquote>\n

The main problem causing great difficulty for the majority of companies is that they are encountering metrics such as the \u00a0number of Twitter followers\u00a0<\/a> or the quantity of \u201clikes<\/em>\u201d that a\u00a0 publication on Facebook<\/a> has without knowing what these figures are important and all this is insufficient when measuring your company’s profit based on your actions on networks.<\/p>\n

Because, honestly, what does it really means when your<\/strong> publications on Facebook<\/strong><\/a> are shared more than 300 times if this isn\u2019t helping you reach your goals? <\/strong><\/p>\n

Now, you\u2019re probably asking yourself: is it difficult to measure Social Media ROI?<\/em> <\/strong>A little. Is it necessary? <\/em><\/strong>Without a doubt.<\/p>\n

For this reason, we\u2019re going to try and make it as easy as possible for you so that when you\u2019re done Reading this you\u2019ll know how to measure the Return on Investment of your efforts on social networks <\/strong>without feeling like your heads going to explode.<\/p>\n

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How to calculate Social Media ROI in just 5 steps without dying during the attempt (includes formula)<\/strong><\/h2>\n
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  1. \n

    Define your objectives<\/strong><\/h3>\n<\/li>\n<\/ol>\n

    Before you start to measure ROI on social media, there\u2019s something very important you have to do: identify your objectives. <\/strong>And being realistic:<\/p>\n

    If you don\u2019t know where you\u2019re going, then how are you going to get there?<\/em><\/strong><\/p><\/blockquote>\n

    Take the necessary time to define your brand\u2019s objectives <\/strong>to ensure that you are measuring ROI based on them, because, for example, wanting to generate sales that increase traffic to your website<\/a> and generating brand image is not the same thing.<\/p>\n

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    When you define your objectives, always remember that, ideally, they should fulfill 5 requirements: they have to be specific<\/strong>, measurable<\/strong>, accomplish-able<\/strong>, realistic<\/strong> and time sensitive<\/strong>; or what is also known as S.M.A.R.T. objectives.<\/strong><\/p>\n

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      Track your KPIs<\/strong><\/h3>\n<\/li>\n<\/ol>\n

      KPIs<\/strong> or Key Performance Indicators <\/strong>are the metrics which measure if you are completing your objectives or not<\/strong>, in regards to the ones you\u2019ve previously defined.<\/p>\n

      For example, if your objective is to increase the number of Instagram<\/a> followers then a good KPI to measure would be reach. <\/strong><\/p>\n

      There are many KPIs that you can have as an objective for your business and they normally vary from one Company to another (for example, you shouldn\u2019t be measuring the same KPIs if your objective is to increase sales on Facebook<\/a> \u00a0as if your objective is to direct traffic to your blog<\/a>).<\/em><\/p>\n

      The truth is that KPIs are vital in knowing if you are on the right path and if you are fulfilling your objectives, like ROI\u00a0\u2014 in fact, ROI itself is a key indicator being as it helps us know what the performance of an action is\u2014<\/em>. We like to say that\u00a0 ROI and the other KPIs go together<\/strong>.<\/p>\n

      But going beyond all of this: what is the relation between KPIs and ROI? Why do you need to keep KPIs in mind in order to figure out the performance of your social network actions? <\/strong><\/p>\n

      First off, you should identify your KPIs so you know what you want to focus on and thus it will be easier to measure ROI \u2014and the return on investment\u2014. KPIs help narrow this down.<\/p>\n

      For example, if you want to know if your social media content is working, how would you do it?<\/strong><\/p>\n

      And this is where KPIs come into play. In this case, for example, in order to know if the content you\u2019re publishing on social media are being read, a good KPI to keep in mind would be traffic; <\/strong>since by measuring traffic you\u2019ll be able to have an idea of how well your actions focused on increasing views functioned and then you can calculate ROI.<\/p>\n

      Now, which KPIs can help you to find out the return on investment of your actions on social media? <\/strong>You should measure certain KPIs based on what your objectives are. Here are some of the most important:<\/p>\n