Measuring the ROI of social media

I wanted to share this simple but excellent presentation from Egg Co on measuring return on investment from social media.

Here’s a quick summary:

1. The qualitative benefits of social media are obvious (eg. building trust, loyalty, brand awareness), but these are also seen as hard to measure.
2. To measure the ROI of social media activities, we need to move past conventional metrics for success.
3. Marketers should figure out simple, commercial success metrics, for example: “reduction in support costs”, “number of new things we discovered about customers that we never knew before” (my favourite is “number of minutes a day we spent being nice to customers”).
4. Set campaign goals based on these, “your return is successfully meeting or exceeding these goals”.
5. Implement campaign, drop the stuff does doesn’t achieve the goals. Repeat.

This is a simple but very important framework when considering investment in social media. Without a true focus on creating measurable business value, there is a real risk that organisations will end up just creating more noise and wasting their investment.

Alex Campbell is a strategy and planning consultant at digital agency, DTDigital.