One of the most pressing questions that marketers ask about social media is whether they can calculate the social media ROI or which is the average ROI for social media these days? In other words, what’s the value that you get in return for your marketing efforts?
The social media ROI can be analyzed from many perspectives such as customer lifetime value, customer referrals value, or even customer influence value. However, there’s a lot more value that’s gained by social media than just some number such as revenue minus expenses. Another question would be why do you need to measure your social media ROI? There are a number of reasons why measuring social media ROI should be a priority in your business. Keeping an eye on social media revenue can help you to demonstrate the value of social media marketing to your company, prove that your social media marketing strategies are effective while identifying areas of your strategy that are particularly successful to shift more budget towards them.
Determining the difference between a good social media ROI and a bad one can be challenging. After all, there’s no universal number that would stand for a desirable social media ROI that’s sufficient to sustain your business. To understand how good your social media ROI really is, you need to benchmark it against the market. This way, you’ll know how much your competitors are investing in their social media marketing efforts, what they’re getting in return, and how your own revenue stacks up.
It’s not easy to track your social media ROI. It’s a very complex operation that involves a lot of consistency across metrics and social media platforms. As per the 2019 Statista findings, 56% of marketers think they’re unable to track their social media revenue which means almost 1 in 2 marketers don’t have any clue if their social media efforts are paying off. If you want to learn more about social media metrics, check my latest blog post.