Measuring ROI of Your Social Media Marketing Campaign

Google Analytics to measure your social media campaign

Google Analytics to measure your social media campaign

Stop. Before you go any further in this blog about social media marketing, stop and ask yourself, “am I ready to do what’s required for my campaigns?”

Doing the right thing isn’t always easy, particularly in Marketing. That’s because modern Marketing isn’t easy anymore.

It’s hard and it requires math. (I know I just lost about half of you when I said the other M word…math.)

Today’s marketer must be part mathematician, part magician, and seemingly omniscient. Fortunately, there’s an app for that.

I’m not kidding. The app is “analytics.” (Okay, analytics is more than just an app, but I’m working on my segues.) But if you don’t use analytics and other appropriate measurements, you can’t measure your social media campaign.


Getting Started by Creating a Baseline
Before you start your campaign, decide what exactly return on investment (ROI) is to you. Is it getting your target audience to register for messaging? Download or view a multimedia asset? Visit a particular page on your site?

These activities or page views are usually called key performance indicators (KPIs). That’s just a neat way to mark the kinds of activity that measure intent. Not all KPIs are worth the same amount to you, so let’s not pretend “registration” offers the same marketing value as “watched a video.”

Now, if you’ve been running an analytics software package like Omniture or Google Analytics, you probably have a baseline of information. So, for example, if you want “more” people to download your PDF or watch your video, go check your analytics and determine how many are watching already. If 100 people are day are watching and downloading, you will call that your baseline.

Now that you have your baseline, you will use this to measure the impact of your social media activity. This can be online or offline activity, as you will quickly see.

Best of all, you haven’t had to look at any math yet.


Changes in KPIs Help Measure ROI
With your baseline data, you were able to measure that you were receiving, say, 100 registration per month to your Super Awesome Newsletter.

And since you know that people registered to your newsletter are more likely to buy Your Stuff, you definitely want more people to register. Maybe, just maybe, you also know that people who subscribe to the Super Awesome Newsletter have a yearly value of $200.

In order to give this next example, let’s just say you did Activity #1. This can be a big social media push, a search engine marketing (SEM) campaign, or even a television appearance on Dateline (hey, someone has to be on Dateline!).

Immediately following your campaign, you watch your KPIs to see if Activity #1 has moved the needle. And since you are a fantabulous marketer, you can see that Activity #1 has increased your monthly registrations from 100 per month to 150 per month.

Now, take a deep breath. Math isn’t hard. You can see that 100 to 150 is a 50% increase. Easy.

You can also measure that your KPI (valued at $200) increased by 50. So 50 times $200 equals $10,000.


The Parabolic Arc and Sustained Lift
If you’ve made it this far, it’s because you realize that this is all very doable. Most campaigns aren’t this basic, but sometimes…sometimes they are. And if they are not, then apply the same principals and scale them to fit your needs.

Usually your campaign is going to have a lifecycle. That is, even an appearance on Dateline is only going to drive traffic for a certain amount of time. It could be a few hours or a few days, but unless you keep pushing Activity #1, traffic will inevitably start to fall.

You might see a nice arc that begins to rise with Activity #1, peaks, and then slopes back down. Sometimes this is a sharp spike, but in most cases, it’s the kind of curve you used to draw in geometry. (Geometry. Shudder.)

But then there’s this funny thing called sustained lift that sometimes happens at the end of your campaign. You see your campaign rise, peak, and fall, as expected. If you’re lucky (and you’ve built your site in the right way), you may see a sustained lift.

Sustained lift? Sure. You started at 100, increased to 150, and returned to 110. That 100 to 110 difference is your sustained lift. The 110 becomes your new baseline.

Your extra 10 registrations to the Super Awesome Newsletter is $2,000 multiplied by the number of months it sustains at this level.

Again, campaigns aren’t usually this simple, but for illustration purposes, you can see that 110 is better than 100. That needs to be part of your math because now you’re going to tie it all back to ROI.


Final ROI Calculations
This is the last math, I promise.  Let’s say that Activity #1 cost you $2,000. It could be dollars spent, your valuable time on social, or that coveted appearance on Dateline (travel expenses).

Was Activity #1 worth your effort? Well, if you spent $2,000 to get $10,000, the math suggests it was.

If you do no other activities for 6 months — and you see that your sustained lift stays at 110 per month — you can add another 60 to your measurable KPIs. That’s 60 x $200 = $12,000.

As it turns out, the sustained lift was more valuable in ROI than the actual campaign. If you weren’t prepared to measure this, you could easily miss this little fact.


It’s Not Magic, It’s Math
So, if you’re a Marketer and not a Mathematician, you may be wondering what just happened. Is Marketing really this easy?

No, not really, but it’s also not that hard either. I mean, if you isolate your complete campaign to one activity, it’s possible to measure your social media campaign. Most campaigns are not a super-simplified example, like the one I illustrated here.

But Social Media Marketing and other types of Marketing are measurable. Sometimes it’s easy and other times it is maddeningly difficult, but generally the principals are the same.

The basics:

  • Set up your analytics
  • Identify your KPIs
  • Measure your baseline
  • Run your campaign
  • Measure the change

Marketing is far more complicated than this, but even you can do this. Larger campaigns for bigger brands are definitely more complicated, so you may need to work with specialists to get more accurate reporting.

The best part is that you will soon be able to measure the impact of your individual and combined traffic drivers. It can be a social media campaign on Pinterest or paid search engine advertising on Google. Measuring your ROI will tell you where to invest your time, energy, and out of pocket expenditures.

It will not be easy, but it is essential to modern digital marketing. And if you are really successful, the next math you need may be to calculate your bonus.

3 thoughts on “Measuring ROI of Your Social Media Marketing Campaign

  1. This it’s a great post Buddy. I always tell clients they need to schedule in time to measure their progress, so they know they are getting something from their online (and offline) marketing efforts. Very few get the chance to do it. I’ll be pointing them to this post for an easy way to see how.

  2. Wow, thank you, Ann. If we help our clients to achieve, measure, and report success, they will continue to see social media as viable channels for sharing their brand messages. If we fail to measure the effort, next year their dollars will go elsewhere. 

    Thanks for the comments. I hope to see you more often!


  3. I am a Digital Marketing Post Graduate student and your post made things much easier to follow and grasp the linkages between maths and my marketing objectives. Thanks a lot

Leave a Reply