Maximizing Social Media ROI: Aligning Business Goals with Effective Metrics (Full Transcript)

Speaker 1: Hi, I'm Daria, the product manager for HubSpot's social media tools. We talk a lot about how your business goals need to align with your social media goals. There are a number of metrics you can measure to determine your return on investment, but having a system in place for how you're mapping social actions to those business goals will make it much easier. Most marketers are measured by how their programs and campaigns perform in generating leads and revenue. While positive brand sentiment and a high level of customer service are important, your boss wants to know that the time you're spending on social media is actually translating into leads and customers. Essentially, revenue is the ultimate indicator of social media marketing success, but depending on your sales cycle, it can be months before you've closed new customers from a social media campaign. Because of this delay, it's important to use leading indicators of revenue success, such as the following. Signups for email, webinars, and events. At HubSpot, we even have people sign up for reminders about our live events. Product downloads and trials, purchases, how many people buy your product or service as a result of an action in social media, downloads of marketing materials, your visit to lead conversion rate, we love this one, of the social media traffic that you're generating, what percentage of those visitors become leads, sentiment analysis, how the internet feels about your brand can be an indicator of satisfaction, passion, and loyalty, competitor benchmarking, understanding how you stack up against your competition can help you pivot and make better business decisions, website traffic, reach and engagement. This includes likes, shares, and comments, audience size, and finally, campaign results. Dennis Yu, the Chief Technology Officer of Blitzmetrics, tells us.

Speaker 2: The most important thing to keep in mind when measuring social ROI is using the same metric that you use for all the other channels. So you've got goals, content, and targeting for your business. Maybe the goal is ROAS with a revenue counterbalance. Maybe it's number of leads versus a cost per lead. Maybe it's a particular product launch that you're trying to get in front of a certain audience at a certain recall rate. The same metrics that you use for any other channel should be the same metrics, shouldn't they be, for social. It's a question of how do you measure that.

Speaker 1: To take a deeper look at how social media could affect your business's key performance indicators, or KPIs for short, here are some examples. Lifetime value. How much revenue do you earn, on average, from a customer? Lifetime value multiplied by conversion rate. How much is each potential visit worth to you based on the percentage of visitors who convert? Average sale. How much is the average purchase from social media into your website? Pay-per-click ad valuation. How much would you end up paying if you were to use ads to achieve the same social media results? Resource savings. Were you able to have a customer take an action in social that will save the company money elsewhere? For example, watching a video or receiving a social media response rather than a lengthy call into customer support? You'll also want to be tracking your social media expenses so you can calculate ROI against your marketing campaigns. Here are some things to track. Work hours. Agency or freelance costs. Social media software and services. Content development expenses. Advertising costs. Once you understand what your social media efforts cost, map those expenses to your social media campaigns to determine your ROI, return on investment. The ROI of a social media action is calculated by dividing the net income by the cost of this action and multiplying it by 100. For example, let's say a business invested $2,200 on a social media campaign to promote a new product on Facebook and Twitter. Once they completed the campaign, they found they made $9,500 in profit. The calculation for ROI would look like this. $9,500 divided by $2,200 multiplied by 100. That's 432% ROI. How awesome is a number like that? While we might not be able to achieve this sort of success, you'll never know unless you're tracking your efforts. It's also possible you'll find that your ROI is negative. If so, you'll want to adjust your campaigns or make changes to future campaigns based on your learnings. And finally, make sure that you report your findings back to your team and to your executives. When it comes to measuring ROI, the benefits are endless. Brands can find new fans, customers, and leads, adjust campaigns to be more effective, and shift spend towards programs that will be more beneficial to the business.