Drumroll, please. We’ve made it through the countless ways we can measure a soft Return on Investment (ROI) for social media and we’re finally going to spill the beans on direct benefits.
Conversions. Hard sales numbers. The stuff that makes the majority of marketers quake in their boots!
Conversions and sales mean ACTION.
That can mean clicking a link, filling out a form, or (what we’re going to focus on today) adding to the bottom line through the purchasing of goods or services.
Ready to get started and rock your ROI?!
SMM ROI: Measuring Conversions & Sales
Let’s start with the 100-level stuff.
Social media only offers (or direct-response sales):
- Secret or Whisper Words: When placed on your social platform of choice, Fans and Followers know they can come into your brick and mortar business and say “SUPERSQUARED!” (example) to receive some sort of discount or promotion.
The drawback: Many facilities say they have problems with their front line staff keeping track of people who use the secret or whisper word.
The cool part: It’s FREE to do.
- QR Codes & Snap Tags: When placed on your social platform of choice, Fans and Followers who have a smart phone can snap the code/tag given to be taken to a custom URL where they’ll receive a discount, coupon or promotion. Depending on your company, the users can then make a discounted purchase online or can come to your actual location to redeem their “prize.”
The drawback: Again, many facilities say they have a hard time collecting or measuring exactly how many codes/tags are snapped and/or redeemed. Additionally, some marketers believe consumers don’t understand or aren’t aware enough to use QR & Snap Codes.
The cool part: You can measure both your click rate and your ROI with certain applications. It can also be a much quicker way to capture a potential customers’ attention.
- Coupons/Facebook-only Offers: While you can “pay to play” with Facebook Offers, you can always create and upload your own coupon as well. Fans and Followers can snag these and bring them to your online or brick and mortar business for redemption.
The drawback: With the clients I’ve personally worked with, both offers and coupons did not have a high redemption rate — even if they had a high claim rate. And, as mentioned above, many facilities had trouble with their staff collecting or noting all of the Offers or coupons that were used.
The cool part: One of the top reasons people “Like” a brand Page on Facebook is for special offers, so essentially you’re meeting the expectations of your audience by deploying this tactic.
Moving on past the easy and “common sense” marketing tactics, let’s dive into some other harder, more advanced, ways to measure direct sales on social media platforms.
- By using a next-step Call to Action (CTA) once a user is on your site (FB, Twitter, Website, etc.), you can measure how many users are entering information on a downloadable form, or squeeze box, to gain some sort of product (whitepaper, free gift, paid product at a discount, etc.)
- If you’re diligent about adding these new customers or potential customers to your social CRM tagged as a “social lead”, you can follow their buying patterns to prove a direct sales ROI
- *Note: Anything you can qualify as a successful conversion (as outlined in your goals or Key Performance Indicators [KPIs]) — newsletter sign up, blog subscription contact form submission, downloading of a product, contest entry, or sale — can be tracked by shrewd marketers
- Bonus: Try to assess whether leads coming from social media move through the sales funnel more quickly or more slowly than traditional leads. If you can show they purchase more quickly, you’ll be a social media HERO!
Adding to the bottom line is an obvious way to say you’ve procured a direct benefit by using social media.
But what if you’re able to SAVE your company money by utilizing social platforms?
Customer service is most notably where brands can save on costs (and add to the bottom line!).
Cost Savings Is ROI, Too!
- Most large brands understand there are costs associated with resolving complaints — and many do this through a call center.
To figure out your own costs, use this equation: Daily Support Costs / Average # of Issues Handled (daily) = Cost Per Resolving Issues
- Keep track of issues coming from social channels (like complaints or questions)
- Label issues coming from social media, as well as how long it takes to resolve the problem (when it was posted vs. when the resolution was posted/the person was contacted by phone or email)
- Compare traditional customer service issue timing (phone & email) with timing on social media platforms
- Use this formula for tracking time spent on fixing issues: Total Work Hours Fixing Issues (monthly) / Numer of Issues Fixed (monthly) = Average Resolution Time
- Once you’ve figured out your percentages for phone, email and social, see if social media is the fastest/easiest way to fix problems. If it is, you may be able to create cost savings for your company!
Lastly, and I won’t go into specifics here, there are contests and promotions you can run through third-party applications.
And. I’m. Spent. I realize not everyone measures ROI in the ways we’ve listed in this four-part series.
I also understand that not every social media professional feels the need to report ROI to their clients.
I simply wanted to address the multitude of reports out there saying it’s impossible to measure ROI. It’s not.
And the faster social media “experts” pick up on that, the better off they’ll be with success and winning new accounts.
ROI Equation (From Dude)
Latest posts by Brooke B. Sellas (see all)
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Brooke, what a great resource you have provided. I have bookmarked and will reread all parts again and again. I do employ some of these metrics and I do measure traffic, sharing and ROI, but you’ve opened my eyes to another dimension…! 🙂 This is super cool for me to have for those bigger companies, especially, I am wooing. This IS what will get me the accounts, I am sure. Thanks for the great run down in your four part series.
Dorien, your comments have me SUPER excited. Thank you for the compliments. AND, I’m anxious to see how things go for you when calculating ROI in some of the new ways I’ve outline. Pretty please keep me posted!
As you know, we’ve been without power due to Sandy – so I’m very sorry for the late response!!
Love how you can explain the number crunches in a way that’s both entertaining and educational. Great post!
Thank you , Mallie. I’m only too happy to help dispel some of the myths shrouding ROI for social professionals.
As you know, Sandy kept me from responding right away. My apologies!
Brooke, I’m a numbers girl. I love your cost savings formulas and data, particularly costs associated with revolving complaints and length of time to resolve issues. Really great information on direct benefits!
Awesome, Nancy! I’m so glad everything made sense. I know it sounds like a lot, but I really think at least some of the things should be very easy for ANYONE to track.
Again, sorry for the late response. Blame Sandy!! 😛
Great post Brooke! I have learned something from each part of this series. Thanks for providing a wonderful resource!
Thanks, Jen, for your kind words! So sorry for the late response – Sandy has us without power but luckily I’ve managed to make my way to midtown today for a makeshift office. 🙂
[…] B Squared Media // B² Blog | Numbers, Metrics & ROI – OH MY! [Part Four] From bsquared.media – Today, 5:57 AM […]
Great article, Brooke! I am going to go back and re-read the entire series. This is just what I have needed! P.S. So glad that you are safe!
Robin Strohmaier recently posted…And The Pig Fell In the Mud
Thank you, Robin! I’m so glad you liked everything. I know it’s a bit boring, but it’s also what we need to prove ourselves as “real” social media professionals!
On another note, thanks for thinking of us! We are so happy to be safe and have power again. We have an amazing support group, so it wasn’t nearly as bad as it could have been. 🙂
Thanks for the awesome info. Even though I’m not a “numbers” lover, Brooke, your series Rocks! I’m certain I’ll be referring back to it … more than once. 🙂
Thank you Melanie!! I’m seriously not a “numbers” person either – as crazy as that sounds. I had to read, and practice and read, and practice some more … and guess what?! I’m still reading and practicing. I don’t think it’s a cycle that ends.
Anyhow, I appreciate you! 😀
I liked your series, Brooke – this is the first time I’ve had a chance to comment on any of the blogs yet though. Unlike some of the others above, I am so *not* a numbers person! But I do know that not only is social media ROI important to my company’s CEO, it is also important to our clients. Thanks for portraying the formulas in a way that even someone like me can follow along – and start using!
Thank you, Jennifer! I promise you, I’m not a numbers person. I’ll even admit that I had to take Algebra in summer school … TWICE! I’ve had to work very hard at understanding numbers and ROI (and luckily have a data scientist on the B2 Crew to go to for advice). I knew it was important to the success of B Squared – and learned from previous jobs that clients REALLY wanted to have more than just friend and follower counts to show their superiors or partners. It’s critical to learn how to show ROI to continue to gain social business (in my opinion). And those that continue to ignore it might find themselves missing out on some serious opportunities!
If you’re in business, you’re measuring numbers. That is, if you are running a SUCCESSFUL business. I think many don’t WANT to measure the numbers because they have no social media marketing plan, are just shooting in the wind, and know they won’t like what they see! I can tell you, as an online marketer, I track where my leads come from, how much they cost, and how many convert. Math is the name of the game and if you’re in biz, you gotta use math! LOL
It seems to me the bigger problem is with all the people calling themselves social media managers and all they actually are is adequate hootsuite users. You know what I’m talking about 🙂
Amen, Martha! It amazes me how many business owners are suddenly “social experts” who think they know the first thing about curating, creating and posting content (much less measuring ROI). Most of them use lazy marketing tactics (I’ll post about that soon) and have no way of showing clients that they’re successful beyond likes and comments. It’s shameful. If you can’t be organized in your day-today life, with your business ventures and partnerships, your events and webinars, then you certainly CANNOT be a social media professional.
And, OH YEAH, do I EVER know who you are talking about! 😉 So glad to be associating with people who know their stuff – thanks for the comment and wonderful insight!
[…] ONE Numbers, Metrics, and ROI, OH MY! Part TWO Numbers, Metrics, and ROI, OH MY! Part THREE Numbers, Metrics, and ROI, OH MY! Part FOUR *left what I think will be a particularly helpful tip for Brooke’s readers on this […]
Nice wrap-up Brooke!
I appreciate the finishing touch here with direct-response sales. As a martial arts school owner (starting in the 80’s!) I have wasted SOOOooooo much money on campaigns because their impact could not be measured.
Now with social media it’s possible to elicit a direct response and know EXACTLY where your leads are coming from, what motivates them and (this is super-important) who else THEY are talking to.
Didn’t know about Wildfire. Gonna look into that. Thanks for droppin’ all this knowledge in FOUR parts! Time for me to give back…
I’ll give my one and only social media tip here for you and anyone that’s into it: learn to use Facebook Events for sales, seminars, and basically any thing you want to make shareable for a limited time or at a specific time.
Once I offered a one day ladies’ self-defense course at our studio for $45 per participant, with a $20 credit for referrals. Combined with a shareable image and copy-and-share invitations, we slamdunked a standing room only event.
There were follow-up sales and conversions to our regular program. Not only for the ladies themselves, but for a lot of their children as well. Countless thousands of dollars that I am STILL collecting came from making a free Facebook event page into a shareable asset.
In another venue I offered a free webinar as an event page. Worked great.
Thanks again Brooke for the bleeding-edge information about using social media. Hope this tip helps you and your readers!
Kurt Frankenberg recently posted…Reaching Out: Blog Commenting, ON PURPOSE
Kurt, you are most excellent! Both in your commitment to read (and learn) and in your commenting, and MOSTLY in your willingness to share! Your tip about events is GREAT and I can’t agree more.
We have had much success sending FB ads to Events or to a custom tab (and saved a ton of time and money). I’d love to have you do a guest post about your experience – I think SO many people can learn from it!
I’ll reach out now … and hey, THANKS AGAIN FOR BEING SO AWESOMELY YOU!