Surveys consistently show that measuring return on investment (ROI) is the top challenge facing social media marketers. But some experts say brands should reconsider if ROI is the best metric for social media. Marketers may need to redefine the meaning of return, according to Sprout Social. Social media marketers may be trying to measure the wrong types of returns. Most social media marketers don’t focus on increasing sales: 80% say increasing brand awareness is their primary goal on social. Another 80% cite increasing engagement, reveals the Sprout Social Index, based on a survey of 1,253 consumers and 2,060 social media marketers.
Social media’s main value is not boosting sales. It works in earlier stages of the sales funnel — the awareness stage when consumers realize they need a solution and the consideration stage when the mull different ways to solve the problem.
Instead of trying to measure ROI, social media marketers can track progress towards increased awareness with KPIs like impressions, reach, engagement, audience growth and video views. Tracking progress towards increased consideration can be done with metrics like engagement, link clicks and video views.
Is ROI Over-rated?
An earlier study from Alitmeter Group, Beyond ROI: Unlocking the Business Value of Social Media, also found that social media ROI is over-rated, at least in its traditional sense.
“A strict ROI approach, while highly credible, does not capture the value of interacting with customers over time and across multiple channels and timeframes,” writes Altimeter analyst Susan Etlinger.
Many measurement experts also argue that ROI is often not the best metric for public relations.
“ROI is a wonderful thing. But it’s not always possible to track every single effort down to a dollars-and-cents return,” states Altimeter Group analyst Rebecca Lieb in an iMediaConnection article. “Often, it’s not possible — or even the most desirable outcome.”
Other performance metrics may be more useful and easier to determine, Lieb says. There are dozens of possibilities. Whatever metric you select to measure results of a PR or marketing campaign, it’s essential to define it precisely and justify its value, Lieb urges.
The Right Content for Each Stage of the Buyer’s Journey
Delivering the right content at each stage of the sales funnel is essential to nudging prospects closer to purchases. When interacting with brands on social media, consumers want both brand awareness content and consideration stage content. But many marketers focus too much on awareness activities and leave out the consideration stage, according to Sprout Social.
Marketers often don’t deliver the type of social media content consumers want, the research reveals. Consumers say the types of social content they value most from brands are posts about discounts/sales (72%) and posts that showcase new products/services (60%). Marketers say the types of social content they share most are posts that teach something (61%) and posts that tell a story (58%).
The only substantial overlap was posts that teach something, desired by 59% of consumers. Educational content can teach customers how to use the brand’s products. It can also focus on the brand’s niche and expertise, even if it doesn’t mention its products or services.
Customers may love deals, but marketers can’t build strategies based only on deals and promotions, notes Sprout Social. While that type of content can prompt conversions, it doesn’t build long-term relationships with target audiences.
Social media listening enables marketers to learn what interests customers and how to create content that inspires and entertains them. Measuring the impact of that social media content requires more than calculating ROI.
Bottom Line: Determining the ROI of social media remains challenging – and may not be the best way to measure the awareness and consideration stages in the sales funnel. Marketers can demonstrate the value of social media by using alternative metrics, including reach and engagement, and employing social media monitoring and measurement tools.
William J. Comcowich founded and served as CEO of CyberAlert LLC, the predecessor of Glean.info. He is currently serving as Interim CEO and member of the Board of Directors. Glean.info provides customized media monitoring, measurement and analytics solutions across all types of traditional and social media.