Conversations with customers of late have unearthed some interesting takes on measuring the value that social media and related marketing initiatives bring to a company, and how they’re changing the way in which marketers will be measuring their impact. There’s still something of a chasm between knowing that social media is important and actually justifying its use via qualitative results.
In order to understand the ROI, it’s important to understand how social media is driving a business. In a traditional sales funnel – such as selling something online – a marketing manager can simply measure how many sales are being driven via a particular social media application.
But what about a business where sales aren’t as clear cut, where sales aren’t being driven by specific channels or funnels? It’s impossible to measure the value that social media is driving via incremental sales. Instead it’s about measuring the value of different types of digital marketing.
In that context, a company is asking how is social media driving the brand, or perhaps purchase intent. In many cases, search and online advertising can be measured by tracking incremental volume, so metrics such as “social conversations” to leads or how many opportunities were originated via a social media source come into play. Finally, the percentage of times your brand pops up in keyword searches across particular social sites.
While the end goal is to make money, I think the key is not to expect sales conversion rates to improve necessarily. The key is to start thinking about the intangible benefits that social media is bringing to the table, and the metrics that can measure the indirect impact they’re having on your business.