The 3 key challenges of social media ROI

Social media measurement continues to be a puzzle for many marketers, but understanding the major challenges behind it is half the battle.

Social Media ROI

I often say social media measurement is easy. What’s difficult is evaluating the data and attributing business value to it. There are three major challenges here.

The first is, on the face of it, easily solvable: to know what you are trying to achieve and then select the metrics that will give you the answer.

For example, if you are interested in ‘raising brand awareness’, you’ll be looking at the reach of your content across social media, as well as the engagement it receives (which is really ‘qualified reach’).

The biggest difficulty here is that not all of the social networks provide the data you need. LinkedIn and Instagram, for example, are notoriously tight about sharing their data, which genuinely limits the value of these platforms for marketers.

If your objective is to make sales, you will want to measure clicks to your landing pages, cost per click (if ads are involved) and cost per conversion/sale. Of course, the big caveat here is that the majority of social media users aren’t online to make purchases. See Google’s Zero Moment of Truth for a lesson in the challenges of Last Click Attribution.

Social media ROI challenges - Zero Moment of Truth
Google has labelled the online decision-making moment the Zero Moment of Truth — or ZMOT.

The second major challenge is significantly easier: to give yourself a frame of reference, so that you know if outcomes are good or bad.

Benchmarking over time (month-on-month), against competitors or even other forms of marketing will help frame your performance. This is really about having the discipline to track your data and maybe investing in an analytics platform that will help you to do this quickly and easily.

The third challenge is fiendishly difficult: to connect your outcomes to business goals.

Even assuming you’ve set out with a clear objective and then found and benchmarked your data, connecting this up with the hard metrics of the boardroom requires two essential things to have happened in advance.

READ MORE: Can we really measure social media ROI?

Firstly, you need to have educated your senior managers/directors about how social media works and what it’s for (and isn’t for) and that, fundamentally, they understand there is a value to be delivered. If they haven’t bought into social, they will forever pick holes in your data regardless of how good the results are.

Secondly, you need to have agreed a measurement framework in advance, which clearly attributes the results you are generating to existing business goals.

The word ‘attribute’ is key here, because you won’t be providing data that simply adds up to ROI. Reach/awareness will never provide a $value unless you can map the paper-trail and in most instances on social media, that’s simply not possible yet.

Assuming you can rise to these three challenges, you should have no problem measuring your social media marketing activities. Let me know how you get on.

Luke will be one of three expert speakers on our free Calculating Social Media ROI webinar on July 12. Sign up now to reserve your spot.

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