There are a lot of companies out there now using social media. But there are also a lot of companies who are still resisting it.
The main reason is it’s perceived lack of Return on Investment (ROI), with the boss forcefully announcing that if you can prove its ROI he’ll think about it.
But there lies the problem – how do you discover its ROI? Does it even have one?
The ROI of social media
Earlier this year, Thomson Reuters hosted one of Finextra’s international series of social media events.
Numerous delegates from the Financial Services sector gathered to mull over the enigma of social media, especially Twitter, Facebook and LinkedIn.
During the day a number of tweets were flying around, including one that caught my eye: “There is ROI in social media, finding it is the Holy Grail.”
For me, social media is more about the relationships is creates (or its Return on Relationships – ROR). This then prompted a new flurry of tweets between myself and some colleagues, including Sean Clark spurring him on to write his blog post: What’s the ROI on Conversations?
Twitter is a powerful tool for communication. You can listen to what people want and instantly provide it for them. You can offer advice, recommend something and improve your customer service by solving problems instantly.
Bascially,the ROI (or ROR) you get from social media will depend on what you’re trying to get out of it.
But what about the numbers?
OK, I will admit that, for a lot of CEOs, that’s going to be a bit too woolly. They are still going to want hard cold facts and figures.
So, first off, define your social media strategy – why are you using it?
- To drive sales?
- To boost enquiries?
- To elevate your brand awareness in the market?
Only then can you start to quantify the effectiveness of your strategy.
If your CEO is number crazy, take a look at this useful post from SocialMediaExaminer that addresses this issue – A Simple Way to Calculate Social Media Return on Investment.
Over to you
Do you have any other ways of measuring your social media effectiveness?
If so, leave a comment below. Let’s see how many we can come up with.