How to Measure the True Value of Social Media Marketing for Your Business

social media

August 1, 2013 by

Measure Social MediaThe top 100 retailers on Facebook measured by the number of fans each have an average 1.2 million “likes,” according to ExactTarget findings. Clearly Facebook alone generates massive volumes of data.  Add to that billions more data points created as people tweet, “like,” chat and otherwise connect with brands and with each other on social platforms, and you find yourself drowning in the rapidly rising tide of social activity. So how does all that activity actually translate into business impact? Sure, you want your investments in social platforms and campaigns to convert likes into leads and conversations into customers. But the titanic volume of data generated in the social arena doesn’t give up insights that easily.

One thing is clear − more data is not the answer.

Top-line metrics like total number of Facebook “likes” in isolation give you a one-dimensional, current-state view of your social platforms. But that information provides no insight into what you can do as a marketing team to improve effectiveness. The top 100 retailers tracked in the ExactTarget study noted above had more than a million “likes” on average, but the engagement rate was only two percent. That suggests businesses don’t know how to interact and motivate fans on the social network.

What you need to do is make sense of all this data. You need to evaluate your marketing effectiveness holistically to assess social media impact on paid- and earned-media results. You need to determine if any of this social activity is actually translating into desired conversions on your website, or whether it is impacting paid-campaign performance.

“How do I do all that,” you say? By conducting some much-needed analytics across all the disparate channels of consumer engagement. By applying analytics, you can answer key questions such as:

  • What does it take to motivate someone who just “liked” your Facebook page to visit your website and make a purchase?
  • Do your Twitter campaigns generate any viral impact to change the cost per acquisition (CPA) of your SEM campaigns?
  • Do you observe different conversion patterns for consumers who initiate engagement with your brand due to social efforts versus paid campaigns or branded search?
  • And, perhaps most fundamentally, what’s the true return on investment (ROI) of your social marketing?

Three Steps To Moving “Likes” to Leads and Data to Dollars in Real Time

Let’s sum up the steps required to better understand the business impact of social media and how to improve its role in target audience reach, engagement and conversion – the metrics that make up our traditional marketing funnel. Think of this as a blueprint for transforming social-media investments into true business value:

1. Unify data for all social channels in one view.

You need to view performance of each social channel in a unified interface, a single go-to destination to assess impact of these investments in your marketing program. Start by collecting and bringing together the data generated by Facebook, Twitter, YouTube, LinkedIn, Pinterest and any other social-media channels. Your goal should be crystal-clear visibility in real time into what people are saying about your business, brand and the competition, and how they are responding to your marketing campaigns and promotions in these channels.

2. Compare performance of your social platforms in terms of reach and engagement.

Social analytics enables you to compare reach and engagement metrics across multiple social media changes. For example, compare the number of Twitter followers with Facebook fans in various geographic locations. Likewise, analytics will reveal engagement patterns such as volume and demographics by social channel, including Facebook “likes,” YouTube views and Twitter followers. You gain a window into what is trending on social reach and engagement by channel. Plus you can drill down into metrics by demographic or sociographic segments. Move beyond likes, retweets, shares, favorites and comments to analyze engagement patterns and who goes on to buy your products or services.

3. Analyze earned media's impact on owned media.

To assess true business value, however, you need to go the extra mile. It’s essential to identify what your social media efforts contribute to owned- and paid-marketing channels. Do you know, for example, the quality of traffic driven by social media to your website? How do visitors from different social media channels interact with your website in response to varied campaigns and promotions? How do their engagement patterns compare to those visitors who come from banner ads or organic search? Do specific social campaigns impact the CPA of specific paid campaigns? Are there any geographical differences in target audience behavior? How do changes in social sentiment about your brand affect reach and engagement on your website and who becomes a buyer? Likewise, how do changes in social sentiment for your competitors affect these same website metrics?

Social analytics gives you the ability to conduct drill-down assessments of social media impact on website performance and paid-media campaigns, as the four reports shown here reveal. For example, one compares social conversion rates – customers buying as a result of visits to social sites – with average conversions, while another shows website conversions as a result of visitors coming from social channels. This is highly relevant to the marketing team – and these metrics are actionable.

So back to the question we started with at the beginning. How can B2C companies find out whether social media investments are truly paying off? We all know that question has defied easy analysis. But now the data speaks.

Now the Data Speaks

Social analytics give marketers and social-media teams a way to finally identify the value of social media efforts in the broader marketing mix and what they contribute to the top and bottom line. You can even monitor what works and doesn’t by applying analytics to real time data, giving you the ability to optimize campaigns and promotions much earlier in marketing cycles to achieve even greater ROI benefits. Given such capabilities, how could we ever settle for less?

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