ROI Spreadsheet Example
Key Takeaways
- Understanding ROI in Context: Return on Investment (ROI) for social media should not only focus on conversions leading to sales but also compare the costs of acquiring similar traffic through other advertising methods, like Google AdWords or traditional media (print, radio, TV).
- Comprehensive Cost Evaluation: When calculating ROI, it’s crucial to include all associated costs, such as manpower, blog hosting, and other operational expenses, to get an accurate picture of the total investment in social media.
- Long-Term Measurement Strategies: While social media measurement is inherently imperfect, using established methodologies allows for consistent tracking and comparison over time, enabling better strategic decision-making regarding media investments.
Now what about magical ROI? Well, ROI is Return on Investment. When your tracking conversions that lead to sales, tracking ROI is much easier. And Google Analytics is a fantastic tool for this. But when I review ROI for my clients, I add in a couple of other evaluation points such as “How much money would the same traffic cost me in a Google AdWords buy?” or “What would the equivalent reach have cost me in a print, radio or TV ad?” Since most businesses are trying to determine how social media stacks up against other forms of media, I think this is a relevant element to equate. And of course, when you’re considering your expenses, don’t forget to add in things like manpower, blog hosting and other expenses that are contributors to the cost of social media. After all, your Twitter account may be free, but the person you hired to manage it sure isn’t.
Join us for a discussion on social media ROI later this week! You’ll get resources for ROI you can’t get anywhere else!
At its core, social media measurement isn’t perfect, but when we rely on tried and  true methodologies, our advantage is that we can compare apples to apples over the long-term.
