Social is growing faster (34% CAGR) than any other form of online marketing. According to Forrester, social media marketing spend will hit $3.1 billion by 2014 …at that point it will have eclipsed email marketing. How are CMOs justifying this spending? There are three quantifiable social ROI metrics that they’re using the most, and you should be too. These are the metrics that help get budgets approved and/or increased.
The first things to measure are conversions – sales, donations, etc. “How am I suppose to do that?” you might ask. Glad you did. Here are a few examples of how: Create unique coupon codes for offers that you promote on your social channels. Use your analytics package to recognize website traffic from social and track that traffic through to your shopping cart. Bottom line numbers are always the most compelling, so start here and look for other ways to show the dollars flowing.
The next thing to consider is qualified-lead tracking. Depending on your organizations business model, leads from social could be coming in at various stages of the conversion funnel. However, regardless of where leads are entering you should be able to calculate ROI based on the value your company places on a lead.
The final metric to consider is cost-takeout. By leveraging your social networks to make support data – FAQ’s, live support, white papers, etc. – available and shareable in real time you can create considerable cost savings. There are also savings to be realized in advertising – e.g. by using blogs and social networks to gain relatively inexpensive impressions. Ford CMO Jim Farley states that social media has created “massive cost savings” versus traditional media (as much as 10 cents on the dollar!).
Of course, there are qualitative metrics – awareness, intent, reputation, etc. – that you can also monitor. These are important to monitor in order to understand the full impact of your social efforts and to uncover new opportunities. Just remember, work on tracking the quantifiable metrics we just outlined first so you can build the right case for budgeting requests.
Social is going to become more and more critical for marketers as time goes on. Whether your goal is super efficient buzz for a new product launch, connecting with prospects to convert them to leads, or like Ford to achieve big cost take outs, THINK would love to explore the opportunities with you!
Post by Jerry Renoe, Senior Account Director