The Not-So Impossible Task of Measuring Social Media

by Katie Essner on April 6, 2011

A Facebook Causes page pulls in $283,546 in donations for Japanese earthquake and tsunami victims.

A successful YouTube series called “Will it Blend?” that blends everything from iPads to vuvuzelas gives Blendtec blenders a 700 percent sales increase.

So, you ask, can social media be measured? The answer: absolutely.

Your business spends time and money on social media, so why shouldn’t you be able to measure the outcome? We’ve broken the process down into a few easy steps so you can determine your social media return on investment.

As with any other campaign, the first step to measuring social media is to define your goals and objectives. Decide if your social media efforts are going to help your business with customer loyalty, sales or internal communication. Know what you want to measure before you measure.

Next, determine which audiences will best help meet your goals and objectives. Define who the key audiences are and the social media sites to reach them. When Sodexo began their social media campaign, they chose to focus on creating a strong base of job applicants. They used Twitter to seek out people who were tweeting about job searching, cooking and food, and then referred these people to the Sodexo recruitment page. Because of their social media efforts, enough jobs were filled after six months that the company decided to cancel their $350,000 account. This boiled down to a net return of $300,000, or a net ROI of 6,000 percent.

To help measure your ROI, you’ll next need to create a budget. How much, if anything, are you willing to invest in social media? Will you hire an employee specifically for these efforts or will you pay for a monitoring service?

Then, identify the baseline metrics. Do you know what sales were before social media efforts? How many returning customers did you see prior to social media? Afterwards?

Your final step is to compare your results with the baseline. A month after the social media campaign has begun, compare all your numbers. Is there a direct relation to your social media efforts and your goals? How does the money invested stack up against incoming revenue? Readjust your strategy if your goals are not being met.

It’s important to measure social media efforts to see how they are benefitting your bottom line. Social media may seem like a lot of shouting into the endless web, but its results and benefits aren’t all that hard to calculate. Breaking the measurement down into a few easy steps will guide you through the process and confirm bottom line results.