What is Social Media ROI?
Social media return on investment (ROI) is the benefit that your organization receives from the time and resources that you put into social media. Put simply, it’s the answer to that all-too-common question: is social media really worth it?
Why does it matter?
Understanding your organization’s social media ROI is necessary to ensure that social media is worth the time and resources that you’re contributing to it. Knowing the return will also help you understand what is (and isn’t) working. You can understand what platforms are better options for you, what content works well, the value of getting social users onto your site, and where you can improve or expand. It’s also helpful when you’re trying to prove to supervisors or donors that all your tweeting is really worth it.
In order to get an accurate idea of your organization’s social media ROI, you’ll need to:
- Set goals
- Measure goals
- Compare to benchmarks
- Draw conclusions
1. Set Goals
It’s hard to understand the value that social media has without having measurable goals to prove some sort of reward from your efforts. Setting goals that indicate forward movement for your organization’s mission will help you measure how you’re doing. Here’s how to set your goals:
Create a Marketing Funnel
A marketing funnel gives context and relative value to metrics and builds the larger narrative that they all build on each other to achieve your desired outcome. This funnel will help your team realize the value of digital marketing, content, and communications because it puts them in context of the larger outcome.
Create a funnel of engagement for your nonprofit and focus on those digital goals and measurable metrics—these will guide you in setting goals and understanding your organization’s social media ROI.
Choose Social Media Goals
Do you care about users engaging with you on-platform (i.e. within Facebook’s walls)? Or off-platform (i.e. getting them from Facebook to your website)?
On-platform goals are set to be reached on the social media platform (whether that be Twitter, Facebook, etc). These are goals like number of impressions, engagement rate, and other vanity metrics like total number of followers. These goals are helpful for brand awareness, social proofing, and can help drive traffic to your site. You can dig into Facebook Insights, Twitter Analytics, YouTube Analytics, and soon Instagram Analytics to understand your past performance, set attainable goals, and then track progress.
Off-platform goals are set to be reached off of the social media platform. Email signups, donations, resource downloads, time spent on page, and volunteer signups are all off-platform goals. Often, they are also more closely tied to the true impact of your organization than on-platform goals. These goals are probably going to be more indicative of your true social media ROI.
Setting and Tracking Off-Platform Goals
If you don’t have Google Analytics set up already, do that now– you’re going to need it to track off-platform goals and understand the behavior of users that come to your site from social.
Refer to your funnel of engagement —what are your digital goals? Say you’re Power Poetry, the largest online poetry platform for teens. 3 of your off-platform social media goals are:
- Get teens to become members
- Produce engaging action guides
- Become the Wikipedia of literary terms
Cool, those are great goals that support their mission. But how do you measure those? This is the part where you turn your digital goals into ‘measurable metrics’, which can be tracked in Google Analytics. So for the 3 goals above, those metrics would probably be:
- Number of new members
- Time spent on action guides pages
- Time spent on glossary pages
Once you set those ‘measurable metric’ goals up in Google Analytics, you can start measuring.
2. Measure Goals
So you set your goals up in Google Analytics and you’re tracking how many users that come to your site from social are converting and completing goals. Great start, but we can’t just leave it at that, because that probably wouldn’t give your social media platforms enough credit and help you calculate your true social media ROI.
Consider this example. A teen sees a Power Poetry Tweet that includes a link to Power Poetry’s site, so they click through to see what it’s all about, and spend a couple minutes on the site. The next night they remember Power Poetry and decide they want to sign up. They search ‘Power Poetry’ in Google, get to the site, and become a member (convert). In Google Analytics, ‘Organic Search’ will get the credit for that goal completion, even though Twitter played a huge role in getting that user to convert. And if this happens hundreds of times, your Twitter account is going to be cheated out of a whole lot of credit.
That’s where assisted conversions come in. Google Analytics’ assisted conversions track user behavior over time so that you can understand all of a user’s interactions with your site leading up to their conversion. This helps distribute credit to platforms and channels so you can more accurately understand your social media ROI. We break down how to use assisted conversions for you here.
3. Determine Your Benchmarks
This is a question we get all the time: “What are industry standards and benchmarks for this metric?” We’ve researched and dug through industry reports and have come with some (varying) numbers, but the reality of it is that the best benchmarks to refer to are your own. Look at your data, compare performance to past performance, and use that as an indication of success.
For example, if your average CTR is 11% and your most recent ads have only 5%, you’d know that something is probably wrong and you can improve somewhere. But if you refer to industry standards that tell you the average CTR for a nonprofit of your size is 3%, then your ads will appear to be over-performing. If you’re just starting out, go ahead and reference those industry reports for perspective, but don’t let them be the marker of your success. Looking at your own data will always give you the best insights.
4. Draw Conclusions
Once you’re measuring your data and comparing it to benchmarks, it’s time to take action. You can bring this data to the table whenever someone at your company questions the amount of time and effort spent on social media. Or, what if you notice that a new social media platform isn’t actually helping you move toward your mission? If social media becomes a timesuck, the data can help you ditch it despite pressure to have a presence there.
Understanding how your efforts contribute to your organization’s social media ROI doesn’t happen overnight.. Once you identify the specific role you hope social media will play, you’ll be able to use the data to prove its value.