My Virtual Blog

In Laymen’s terms when we talk ROI (Return on Investment), we ask “will this expenditure actually provide the benefit that justifies the expense?” if so, “how long will it take?” and “how much will it improve ongoing business?”

With social media, ROI also stands for “Return on Influence”.  The influence you gain by being an expert in your field and gaining the reputation as a quality resource for answers and solutions.

In most investment situations, you use metrics to measure the impact of change.  The metrics in a traditional investment are calculated in terms of cost savings, workforce reductions, increased profits… etc.  These are easily quantified with dollars and cents.  With social media, the metrics are still there, they are just viewed a bit differently. 

Let’s take the example of “Jack’s Book Store”.  Jack sells all types of books but he specializes in antique books.  He established a “shopping cart” website last year to sell his books online and help his customers find him. 

Jack wants to get more traffic to his website and his store, as well as more sales from both.

There are two main points that Jack must understand:

1. Social Media is not a silver bullet; it takes time to realize the benefits
2. Participation on a regular basis is a REQUIREMENT or the campaign will not succeed

We develop a “Metrics Report” showing a starting snapshot of the current state of Jack’s business. 

We then design a campaign strategy tailored to the specific business, which for Jack, would include updating the website for SEO (Search Engine Optimization); developing a blog; establishing profiles on Twitter, LinkedIn and Facebook, and teaching Jack the “link strategy” of making all his social media components work together.

Once the strategy is complete, we add metrics to the “Metrics Report” for all the social media channels.

Three months after the campaign is implemented we would take a snapshot of these same metrics, compare them to the starting metrics and analyze the progress of the campaign. 

When all is said and done, there should logically be an increase in website visits, an increase of sales from the website and an increase of sales from the store.  The amount of that increase is usually proportionate to the amount of effort invested in the social media campaign.

There are obviously mitigating factors in any advertising campaign, such as; you aren’t selling a product that is widely sought after; your prices are higher than your competitor; your customer service is lacking; your website or your store are not an appealing places to visit… and so on.

The bottom line is that social media is not the answer to everything, but it is a cost-effective way to strengthen your brand, promote your products and services, and drive more traffic to your door.  Once they get to your door, your products & services as well as your customer service have to take over.

Oh yes, and about “Return on Investment?”  When your social media marketing campaign is well designed and implemented, positive ROI is attainable and measurable but it takes diligence and effort to make it happen.

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