The Next 3 Things to do Immediately about SOCIAL MEDIA ROIJuly 12, 2019 | No Comments | Written by Gemma C.
Social media marketing is a form of internet marketing and uses a medium such as images, text, videos, product promotion content and user experiences to drive businesses and make profits.
Social Media ROI is a measurement of return on time, money, and other resources an organization has spent on social media platforms.
Calculating Social media ROI
Social media ROI = (Revenue/Investment (time, advertising)) x 100
For example, if you had invested $10,000 on promoting your brand of clothes on social media, and if the returns are $20,000, your revenue (profit) would be $10,000 (returns minus investment). Social media ROI for this investment would be (10,000/10,000) x 100 = 100%.
Scope of Social media marketing – Statistics
Social media marketing is turning out to be a vital part of any organization’s marketing strategy. Though initially, promotion via social media was relevant for a few businesses, now almost any product can be publicized and sold via social media platforms. Here are a few interesting statistics that will help us get an idea of penetration and scope of social media marketing in current business models.
1. As per the latest 2019 statistics, around 3.48 billion people are active on social media platforms of 3.3 billion are social media users on mobile phones as well.
2. The global penetration rate of social media is around 45%.
3. The consumer level grows by 9-10% every year.
4. Facebook tops the list with 2.32 billion monthly active users followed by YouTube and Instagram.
5. Instagram is more popular with teenagers (32%) and with women (38%) as compared to men (26%).
6. The most common patrons of social media commerce online are adults belonging to the age group 18-34 (95%).
7. Around 90% of users claim that they have utilized social media to communicate with brands.
8. Nearly 50 million small businesses globally use Facebook pages to connect with their customers, of which only 4 million pay for social media advertising.
9. According to a CMO survey, businesses are currently spending nearly 12% of their marketing budgets on social media marketing.
3 Things that need to be done Immediately about SOCIAL MEDIA ROI
Firstly, measure the impact social media has on your brand/business in terms of time spent, allocated resources, the proportion of investment on brand promotion and the returns it is yielding. This would be easily the most difficult thing to do because you cannot pinpoint if the revenue is generated due to social media or related resources or other sources. According to a report by MDG advertising,
a. 44% of businesses are unable to measure the impact of social media on their businesses.
b. 28% of marketing agencies express their inability to measure social ROI.
c. Only 17% of businesses claim that they could quantify the revenue impact of social media marketing accurately.
According to the survey, the top social media challenges faced by marketers are- Measuring ROI, publishing content, developing a strategy and trying social to business goals, in that order. So, what is the unit of measurement for social media ROI? Time spent by the users on your page? Counting the likes and dislikes posted by the users? The extent of sharing? How many times and to how many users is your brand shared? The number of clicks on the page and to the website? The survey revealed that the metrics most likely to have an impact on revenues are – Audience reach and rate of growth, clicks to the site/page, engagement, and conversion rate, in that order.
Once you have accumulated the data, the next step is to analyze the data. Make a detailed analysis of issues such as Who is engaging with your content? Are they regular visitors or passers-by? The time they are spending on your page. Are they showing interest in new updates posted by you? Keep track of feedback/ comments
Apply or improve upon feedback/suggestions. Improve continually. Doing these things will let you develop an insight into customers’ outlook and requirement, understand about your competitors and any other factors that may influence your business.
The 3rd and the last step to do about social media ROI is to communicate with your patrons. Ask them questions about what they want and any suggestions they might have
Reply to their comments, even if they are positive or negative. Engage in a conversation/discussion or dialogue with your customers. Keep their contact information and try to communicate regularly, thus developing and nourishing your customer database. This will help to reach out to the untapped customers on the vast internet as there are no physical or financial barriers. You can connect with any person however remote he may be located with no additional cost. A proper measure-analyze-communicate strategy will effectively help you to grow and expand business by means of a social media platform and enhance social ROI.