Return on investment (or ROI) isn't a concept with which the business world is unfamiliar. People are always searching for smarter ways to invest (which explains the popularity of investment services like Betterment). But according to Fast Company, a surprising 88% of a sizable sample of marketing professionals feel they couldn't accurately measure their social media campaigns' effectiveness. Of the individuals surveyed Fifty-two percent said that dealing with social media ROI was their biggest frustration.
However, learning how to drive ROI with social media is almost immeasurably important for companies today. It all begins with learning to measure it properly, so it's astounding that marketers aren't doing everything in their power to make this happen. Here are a few reasons why many companies aren't making an effort to measure their efforts.
This would be the ostrich-inspired, head-in-the-sand phenomenon where a company fails to question its social media efforts simply because it doesn't want to hear the answers. This sort of social media denial seems to be particularly common in larger, more entrenched firms that don't really understand social media's potential in the first place. Of all the roadblocks preventing companies from measuring their social media ROI, this is the first (and possibly most difficult) one to get past.
Many marketers seem to be surprisingly unaware of the correct tools required to measure the effectiveness of their efforts. Fortunately, however, there are innumerable tools out there for collecting data regarding your social media ROI. Some of them need to be used in conjunction with others for maximum effectiveness — using Conversion Measurement and OptimizedCPM together, for example.
Other well-regarded and effective tools include Viralheat, Spredfast, Sysomos, Sprout Social, and UberVu. And from a content creation perspective, a tool like Curation Reports is an excellent option for tracking the entire life-cycle of a link as it's shared across multiple social media platforms.
In this instance, the company either doesn't feel it's important to collect and analyze the data, or it simply doesn't think it has the resources to do so. Under most circumstances, the former case is much more likely than the latter. With a little planning and the proper insight, all you really need is an Internet connection and the proper tools to collect the necessary data.
It can be hard to know exactly what data is relevant in terms of maximizing your social media return. After all, it's often difficult to determine the difference between causation and correlation in social media. For example, if you're looking at search rankings, you'll probably see that content with the most social signals also tends to rank highly in search.
But as Matt Cutts and Google have said time and time again, social signals are not a part of the ranking algorithm. So what does this mean? It only tends to indicate that content that ranks highly on social platforms tends to have the same characteristics that cause it to rank well in search. Thus we have a correlation between these two things, but not a causation.
This is really an instance of data overload, where inaction is being caused by the sheer volume of data that's available. By learning what data is important, though, you'll be able to narrow down your focus. With Facebook for instance, the number of fans you have is really irrelevant versus the amount of engagement you're getting. Overcoming this particular obstacle is really very simple: Don't get sidetracked by the white noise and, instead, train yourself to look only at what matters.
There are some good formulas for measuring your social media benefits, but it all begins by recognizing that taking a "Field Of Dreams" attitude toward your social media efforts is a self-defeating mentality. It's a losing game to simply trust that if you build it, they will come. Instead, it's in your company's best interest to take a concerted and meticulous approach to how you measure your social media strategies.
Is your company currently under-performing in how it measures social media ROI? If so, then why do you think this is happening?