3 Questions CMOs Should Ask About Social Media ROI

Dan Stasiewski
Dan Stasiewski Enterprise Data Analyst, Kuno Creative

Posted on January 9th 2013

3 Questions CMOs Should Ask About Social Media ROI

Social Media ROIThe days of saying brand awareness and loyalty are the only results of social media activity are over. Like any other part of your marketing, there needs to be quantifiable success to determine the value of social media.

This isn’t to say you should abandon social media. Far from it. Instead, your company’s social media team should be asked to demonstrate ROI—just like any other part of marketing.

The difference between five years ago and today is that counting clicks, shares and followers aren’t the only ways to show results. Instead, you have to know how social media is generating leads and if those leads are turning into customers.

So what should you ask to ensure you are generating revenue through these channels? Here are three important questions: 

How Are We Currently Demonstrating ROI? 

In the early days of social media, I was delivering details on retweets, comments and follower counts. Often times, mining and reporting customer activity and sentiment was also part of determining success of all marketing and PR efforts. These elements are still important, but most B2B companies don’t need this reported on a regular basis. 

Social media ROI can instead be determined by demonstrating social media visit-to-lead and lead-to-customer rates. This generally requires two things: 

  • CRM software (like Salesforce)
  • Marketing software with social integration that communicates with your CRM software (like HubSpot) 

When you have these two pieces in place, you can close the loop on social media activity.

Why is this important? Social media leads tend to have a higher visit-to-lead rate than other web leads. (The difference between social media and other channels is indeed the brand awareness and loyalty, so engagement is generally higher.) In researching our social media success across industries, I’ve seen social media visit-to-lead rates up to 300 percent higher than the average visit-to-lead rates of one to two percent.

Take a look:

Social Media Visit to Lead Rates

Because social media leads retain a 100 percent higher lead-to-customer rate than outbound marketing activities, social networks can be lucrative channels. Unfortunately, the value of your company’s activity remains unquantified until you can see those numbers in front of you.

How Can We Make Social Media More Efficient?

There’s a myth that social media can take up a lot of time. Unless you’re a big B2C brand or you have a customer support Twitter account, there’s no reason to monitor social media every minute of every day. That would be like paying an employee to stare at the telephone and wait for it to ring.

Social media is primarily a broadcast tool. For B2B marketers, and depending on the scope of your social media accounts, your team can schedule updates to go out throughout the day using a tool like BufferApp, Hootsuite or HubSpot’s Social Media App. Even Facebook has built-in scheduling features on Business Pages. With scheduling, it’s easy to maintain social media accounts on the major social networks (Facebook, Twitter, LinkedIn and Google+) in an hour a day.

The less time a person spends on managing the social media accounts, the more time they have to create blog posts, whitepapers and eBooks. This content is the fuel behind all social media lead generation activity. Which brings us to the final question:

How is Social Media Integrated with Other Digital Marketing Efforts?

Ultimately social media is used to deliver information, ideas and messages to customers and potential customers. But that isn't limited to a single tweet or status update. Your marketing team should concentrate on developing content that can be shared on social media. This includes: 

  • Blog Posts
  • Whitepapers
  • eBooks
  • Videos
  • Infographics

When a visitor fills out a form on your website to access your content, the data you capture can be used to build stronger profiles for prospects and customers alike. This is so important that CMO.com named this form of social media maturity as the third biggest marketing trend in 2013. Plus, the rise of social advertising as a necessity for brands of all sizes means you need content to fuel those activities, as well. 

In the end, the way you answer the above questions today will determine how you and your team plan and implement a social media strategy tomorrow. But chances are the ever increasing pressure to prove ROI for all of your marketing efforts will be applied to social media sooner rather than later.

photo credit: JefferyTurner

Dan Stasiewski

Dan Stasiewski

Enterprise Data Analyst, Kuno Creative

Dan has developed online communities and building buzz for companies, products and brands professionally since 2003. Today, he helps Enterprise-Level clients map content to different buyer personas and develop behavior-triggered lead nurturing communications at Kuno Creative, an inbound marketing agency. Find him on Google+.

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Comments

I've only seen ROI produced from one vendor, and that was Kairos Zero. They discussed more than just social media with me and my team - they covered everything. They uncovered problems in our marketing that we didn't even realize existed. 

Couldn't agree more Dan!

This is important. I tell clients all the time it's about relating your social media effort to website visits to the leads created from this. With analytics these days there's little excuse (apart from finding the time to do so) to not be measuring this.

Great post Dan!

All excellent points made. Something I think that you're missing (and I only notice this because I do it everyday) is the value of having your social media people bring in leads directly. As a community manager I'm constantly floating around the social space monitoring for industry content and having conversations with people about all kinds of things related to our industry. Through all of these activities I'm also constantly bringing people in directly who have been intrigued by our software. This is the most direct way to track the ROI of my efforts. However, by also doing a little bit of extra work we can see when a new lead has wandered over to our site from a comment I've left on a blog (such as this one) and can directly track it.

ROI in social media is not impossible to find, but we do have to do our work to look beyond those vanity numbers and do some real work to see what's actually going on.

Cheers,

Sheldon, community manager for Sysomos and Marketwire