Aligning Social Media ROI Metrics to Business Objectives

Aligning Social Media ROI Metrics to Business Objectives

According to the latest survey from TrustRadius and numerous other recent surveys*, measuring return on investment from social media is the number one challenge for social media teams:

“In our survey, “Measuring ROI” was the most commonly cited challenge; 60% of respondents included it as one of the top three most challenging aspects of their social media program. It’s followed by “Tying social activities to business outcomes” (a similar challenge) and “Developing our social media strategy.”

In addition, the latest Australian Sensis Social Media survey reported that the number of medium and large businesses tracking social media ROI has dropped in the twelve months leading up to May 2015.

Social Media ROI Metrics

This means that less than one third of Australian businesses measure ROI and this figure is decreasing.

 

There have been numerous reports highlighting that social media ROI and alignment to business objectives is a major challenge for social media and content marketers. Refer to the end of this blog for more sources of information*

 

In this blog we attempt to provide ROI metrics that can be used to report to business executives and marketing. In addition, Results 2Day has created some examples metrics to assist with the business goal alignment.  You, can access the sample social media ROI metrics here​

 

Typically social media objectives align to business objectives in three main areas:

  1. Brand awareness
  2. Customer acquisition
  3. Customer satisfaction/retention

 

Unfortunately there is often some confusion measuring customer acquisition. Acquisition typically refers to new customers to the business. However social media marketers often see acquisition as new social media subscribers. Measuring an increase in sales can often seem daunting, as TrustRadius indicates:

“Social media goals are not wholly aligned with overall business goals…
Overall business goals are more likely to also include goals tied directly to revenue, such as increase conversions, tap into a new market, reduce churn, etc. In terms of both strategy and measurement, most companies have not been able to align social media efforts with the broader business objectives”

In this blog we have differentiated between business social media metrics and marketing social media metrics for the sake of clarity.

 

Business Objectives

Typical social media metrics that may align to business objectives are:

 

Brand awareness – is the brand being noticed in the market? What share of voice does the brand have? Metrics, to be considered include:

  • Share of voice
  • Reach – across the whole of social and broken down into platforms
  • Engagement and advocacy rates over time
  • Online reputation scores
  • Brand sentiment (note: refer to sentiment analysis blog for types of sentiment analysis tools to utilise)

These metrics are more useful when compared over time or compared to competitive brands to achieve a frame of reference

 

Customer Acquisition. Social media can be utilised throughout the sales cycle to

  • Gain insight into your buyer persona or target prospect group and discover influencers
  • Identify brand advocates, engage, leverage for references or convert to customers
  • Use Enterprise Listening to as a lead generation tool, to track intent to purchase, reach out to prospects and convert them to customers
  • Track click-through-rate from social media platform to website to sale using Google Analytics
  • Listen at the point of need, follow and intercept competitor conversations, and discover opportunities to directly engage.
  • Create a social media ROI based on conversions to sales

However, the only metric that will interest the business is number of incremental sales achieved. The bonus here is that this number on its own can justify the social media investment.

 

According to Hubspot, social media leads have gained more popularity than any other lead source:

social media sales leads
Customer Satisfaction:

Accurate sentiment analysis is crucial when measuring customer satisfaction. (Refer to this blog: sentiment analysis blog, which describes the sentiment analysis methods to look for in social media tools. Metrics to consider for customer satisfaction include:

  • Brand sentiment compared to competition
  • Advocacy rate

 

According to TrustRadius the goals for the social media team vary by company size:

Marketing Objectives

In addition to business metrics, marketing metrics still need to be tracked to ensure that marketing activities are successful and information is obtained to ensure that campaigns are continually improving. Some useful metrics include:

 

Awareness – measure which social channel reaches the largest potential audience

Acquisition – measure changes in brand social channel followers/subscriptions

Activation – measure changes in engagement and advocacy rates

Campaign success – measure sentiment, verbatim and keywords before and after the campaign to determine campaign success (please ensure you utilise a natural language processing tool or human measurement for sentiment analysis)

 

The latest survey, released last month entitled, Social Media in Australia indicated that Australian business use the following metrics to track their social media investment:

Measuring social media ROI

The most popular metrics are brand awareness metrics, followed by sales. Sentiment is the least utilised metric (which is probably because most social media tools utilise keyword methodology, which is inherently inaccurate).

“When you see the metric, do you know what you need to do? If you don’t, you’re probably looking at a vanity metric.”

If you are interested to learn more and would like to see some examples, you can download the Results 2Day sample social media ROI metrics here​


 

Sources indicating ROI challenges*

 

Most social media marketers are struggling to track return on investment from social media. In the latest TrustRadius survey, measuring social media ROI was cited as the number one concern for social media marketers:

“In our survey, “Measuring ROI” was the most commonly cited challenge; 60% of respondents included it as one of the top three most challenging aspects of their social media program. It’s followed by “Tying social activities to business outcomes” (a similar challenge) and “Developing our social media strategy.”

TrustRadius goes on to explain that..

“Companies of all sizes and maturity levels are struggling to prove the value of their social programs. Social media activities can be difficult to quantify, and marketers are trapped between readily available “vanity metrics” such as likes and followers and difficult-to-measure objectives such as brand awareness.”

Altimeter’s March 2015 report findings state:

“Marketers find measurement to be the single most formidable content marketing challenge. Measurement is irrelevant unless the organization establishes appropriate KPIs at the outset.”

Last year, Altimeter found that the majority of marketers identified as measurement as the number one area for investment in the year

“67% of marketers named measurement as the top area in which they needed to invest this year”

The latest survey released this month from B2C: Benchmarks, Budgets,
and Trends— North America states:

“Based on the responses to one of this year’s new survey questions, we found that only 23% of B2C marketers are successful at tracking the return on investment (ROI) of their content marketing program. Additionally, 51% say measuring content effectiveness is a challenge, compared with 36% last year”

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