“How do you measure the Return on Investment of social media?”
Sound like a familiar question? Yep, us too. In fact, I’ve often thought it would be easier to measure the ROI of answering that one question than to measure the ROI of social media itself.
Because it’s so difficult? Nope. ROI is one of the easiest calculations in the world. Just divide the financial return you’ve received from social media by the amount you’ve invested in it. And there’s the rub. I’d wager that half of those investing in social media right now can’t quantity the financial return, and the half that can probably don’t know how much they’re investing (hard and soft costs). That’s before you even consider those who can’t do either. And that’s why every conversation I’ve ever been party to about the ROI of social media ends up talking about measuring fans and followers, web traffic and conversions, or influence and reach.
That’s not to say these are bad things to be measuring – right now they may well be the best metrics to track progress against objectives. But let’s not get these confused with ROI.
To help, here are five reasons to stop asking what the ROI of social media is.