In 2011, 60% of consumers with purchasing intent were using various social media platforms for researching products, learning more about a specific retailer and reading product reviews. For marketers everywhere who were looking to connect directly with their target audience and create brand awareness, turning to Facebook or Instagram became an obvious choice. Despite promising results, a significant number of professionals in leadership positions were skeptical of social media’s impact on a company’s growth.

Why should you go beyond the conventional ROI metrics of success?

According to Sean Jackson, CFO of Copyblogger Media  – “Social media marketing is never going to produce an ROI. People who use the term ROI see marketing as something to buy, but smart companies see marketing as an integral part of doing business — a necessity no less important than the company email system, their computers, or their office lease.”

In layman terms, any form of marketing, social media or otherwise, is measured against the profit you generate and the overall cost of operating a business. Most of the brands that you love, for example, Apple, Southwest Airlines or Sephora, recognize social media marketing to be an integral part of how they spend their money, time and resources, which brings us to a simple, straightforward conclusion: Marketing is more about efficiency and less about ROI.

Most businesses approach social media like some kind of slot machine, where they put in a certain amount of money and expect more money to come out. By definition, marketing is supposed to be a function of profits, however, while it’s easy to put a price tag on higher conversion rates, what’s difficult to measure is the value of relationships you build with your customers.

As social media continues to unfold and evolve, it’s important to create a culture of marketing that’s not based on ROI alone.

How should you define measurements that matter?

Frequency, engagement and reach are usually regarded as the modern measurements of social media marketing, however, instead of comparing them against the revenue generated, try to focus on the ‘efficiency’ bit that we spoke about earlier.

  1. Exposure (determines how many existing and potential customers are able to see and interact with your content): Views, followers, brand mentions, subscribers, click-throughs.
  2. Influence (measures your ability to influence customers to exhibit purchasing intent): Industry influence, authority, brand mentions, networking, referral traffic.
  3. Engagement (keeps track of how your target audience responds to your content across multiple channels): Clicks, shares, replies, comments,  retweets, messages and community growth.
  4. Conversions (evaluates how effective your social media marketing strategy is): Opt-ins, email collection, proposals, pitches, lead generation and returning visitors.


Depending on your goals, the first three can be used to gauge brand awareness you created in the social sphere, whereas the last one is better suited for when you’re looking to generate leads.

For example, if your sales cycle is on the low, meaning, an average potential customer takes a longer time to go from stranger to buyer, then stay on top of these figures. Similarly, if you’re noticing a spike in referrals, document and highlight those numbers. Keeping a record of your savings, especially when you’re replacing the traditional form of marketing. Remember, getting an ROI from social media marketing goes beyond just math and numbers. A Social Media ROI Cookbook discovered that for bigger corporations, the biggest benefits of tracking social media ROI are community/customer insight (84%), decision making (51%), investment (35%), financial impact (34%) and organizational development (26%).

Don’t forget to create measurable structures: One of the most common mistakes that businesses make is that they try to complete an entire customer transaction on their respective social media platforms. Facebook, Twitter, Instagram or Google+ are not your virtual storefront, so you must refrain from treating them like trade show booths, where you generate a lot of ‘leads’ that are never followed up with.

Use these platforms to maximize your reach, make yourself look approachable, show people that you’re worth engaging with and interact with people who might eventually turn into customers.

That being said, effective marketing doesn’t require thousands of dollars in ad spend. In fact, small, subtle modifications based on customer feedback can give you more room for improvement against the status quo. Since marketing goals differ from business to business, everyone in the team will have different opinions on what an ideal ROI is. Make way for processes that filter out all this information, so that you’re spending more time on profitable efforts, instead of getting distracted by unsolicited ideas.

In conclusion, it’s important to see social media as a medium to get attention and create a ‘buzz’, however, once you have a potential customer who’s ready to know more about your product or services, you need to direct them to a controlled asset – like, your website homepage or a specific landing page.