Tracking a company's return on investment from a social media campaign can be a difficult task.
The campaign manager must not only establish goals, but also discover the best way to track metrics that influence theses goals. However, according to Ifbyphone CEO and CTO Irv Shapiro, tracking the ROI from social media should not be treated any differently than tracking the ROI from any other marketing strategy.
Read the Website Magazine interview below:
WM: What are some of the problems businesses face when tracking social media returns on investment?
Irv Shapiro: Many businesses have jumped into social media largely because they felt the need to have a presence in order to compete. In many ways, they are correct; however, leaping without understanding the goals to be achieved by a social media channel is never a good idea. What is the strategy for lead generation? Engagement? Branding? Depending on the business, any of these three (and other reasons) could be a legitimate part of the marketing mix.
Once you decide on the strategy, how do you measure it to determine your success? Is it enough to have thousands of “likes” on Facebook or thousands of Twitter followers? Is it a race to gather connections on LinkedIn? Typically, companies can generate thousands of followers, yet have almost no engagement with their target audiences. As a result, they often question why they engaged with social media in the first place.
Social media measurement challenges are very similar to historical marketing measurement challenges – this is simply a new channel. If you are going to make an investment, you first need to understand why (the strategy) and then understand what (the metric). Just because social media is new doesn’t mean the fundamentals of measurement have changed.
WM: What helps constitute a favorable ROI through social media (conversions, engagement, etc.)?
IS: Just like any other marketing vehicle, ROI with social media depends entirely on your strategy. Many marketers choose to measure brand engagement through basic social media metrics, such as comments and the number of “follows” or “likes” – or the equivalent on your chosen network. However, this brand engagement quotient isn’t a perfect science and doesn’t necessarily determine your ROI. It can also be a significant time commitment, requiring constant monitoring.
Conversion rate is the other key metric used to determine social media ROI. However, conversion is open to interpretation as well. Most likely, social media conversion is less about revenue and more about lead generation – such as downloads and other inquiries. Oftentimes, measuring lead-gen activity is easier through URL tracking and marketing automation platforms, both of which are configured to measure lead velocity.
Some businesses also want to measure offline interaction from their social media advertising. For example, they want to know if their Facebook ads are driving to calls to their company. Most businesses mistakenly think this is difficult, if not impossible. However, it can be easy to measure inbound calls from advertising channels – whether it’s a TV spot, print, PPC or Facebook ad. Technologies like call tracking, which assigns unique local numbers to ads across various online channels, help drive traffic and measure both online and offline lead activity.
WM: How can businesses track the returns of their social media advertisements?
IS: There are many technologies that claim to track activity and ROI from social media. The truth is that no one technology can create your measurement strategy. Strategy needs to be defined before implementing measurement tools. The tactics around measuring social media ROI are similar to any other marketing vehicle: unique tracking URLs, download forms, trackable phone numbers and so forth.
WM: How do businesses know which social platforms are going to provide them with the best returns on their marketing dollars?
IS: A business can determine which site has the best ROI in exactly the same way a business decides on other marketing channels: strategy and audience definition, integrated campaigns, and rigorous measurement. Just like any other campaign, the highest ROI vehicle wins the race. If that is a social site or a print ad, it all boils down to metrics.
WM: What solutions does Ifbyphone provide to businesses for tracking social ad ROI?
IS: Ifbyphone provides a voice-based marketing automation solution that tracks all advertising ROI. Measuring social media ad ROI is no different than measuring traditional ads – whether it’s online or offline, print, billboard or television. Ifbyphone provides tracking from the very first search to the final sales conversation.
When a call is made based on an advertisement, Ifbyphone tracks all the information associated with the ad – whether the call resulted from a Web search on a specific keyword, a particular social media initiative, or a basic print ad. The lead is then pushed through the sales force based on qualifying questions and rules – then all the subsequent call data is tracked.