Your Social Media Investment – Defining The ROI For Your Business

By on May 18, 2011
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Success in marketing is always measurable, and with social media it’s the same. Before you embark on your social media marketing campaign, you need to know if your investment is going to be worth the returns.

But how? How do you measure things like community, interaction and likeability? The truth is you can’t, not until you’ve actually tried, failed and tried again until you get it right.

But you can measure the costs involved, and the time it will take you to make these elusive concepts a reality. Once your sales start to increase, you know you’re doing something right. No one wants to mess around with social media, spend thousands of dollars on it, and then get almost no returns. It happens, if you don’t figure out how to properly assess the social media ROI you want for your business.


Be Realistic and Define Success

Success happens when you achieve your marketing goals. The key to social media success, is to start small – and be realistic about these predefined goals. Examine your market, and study similar businesses that have used various social marketing tactics to earn money, exposure, or to grow a larger community.

Take into account that your business is small, and has a limited budget. If all you can afford is a time investment, that’s good enough for now. We can’t overemphasize the importance of trial and error when using social media. Remember that just because a specific campaign or method worked for one company, doesn’t mean it will work for you. It’s a guessing game. Begin by employing small social marketing tests.

Set an easy-to-achieve success level. Then use this data to plan larger, more successful campaigns based on this model. If it all becomes a little too murky, and you begin to lose sight of the ROI for all of your hard work – set financial goals. These are difficult to achieve in the beginning, but they are easier to measure.


The Measurable Goals Defined

There are a few other features of social media marketing that you can measure. Traffic for example, the growth in your communities on a specific platform, and an improvement in brand recognition. You’ll have to use various analytics programs to help you measure these, but any upsurge or clime is a positive one.

If these features improve, then you’re doing something right. If your brand exposure and community grows along with your traffic and sales – you’ve been successful. Now it’s just a matter of figuring out the different levels of success. As a small business, it’s easy to get discouraged by a Youtube video promotion that only gets 2000 views, and not 2 million. Keep your business in context.

You aren’t a Fortune 500 company that can throw millions into a Youtube ad – so your 2000 views is a good thing. In fact, it’s 2000 more people that have seen your brand. That’s success! Stay open-minded and learn from your mistakes. Social media marketing is not an exact art – and frustrating as that may be, it can also be exhilarating when you strike gold with something that works.

Just be sure when that happens – that you can retrace your steps. Continue raising the bar, and progress at a speed that suits your individual business needs.

How do you determine how much money you spend on your social media campaigns? We’d like to know!

About John Souza

John Souza is founder and chief strategist of SMMU and Social Media Impact, and is a bestselling business author. He won the 2011 Tech Marketing Awards ‘Social Media Marketer of the Year’ and most recently the About.com Reader’s Choice Award for Best Online Education Site. John has appeared on The Michael Gerber Show, and his business has been honored at the Mashable Awards, Forbes Business Awards and The Stevie Awards.
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