The 3 Rs That Measure Your Social Media ROI
Do you know what kind of return on investment, or ROI, you’re getting from your social media strategy? Measuring your social ROI is essential because it tells you whether your social marketing strategy is working — or not. (Let’s face it: You can always tell your clients all about the importance of investing in social. But, are you actually going to convince anyone of anything without some real proof.)
This is where the three big “Rs” of social media come into play: research, retention, and referrals. These are the main analytics that you can use to prove the value of your social media efforts.
So, let’s look at them in detail, shall we?
The Research You Need To Guide Brand Development
It’s simple. Social is a tremendously effective method of collecting demographic data on your customers. Demographic data is the key to inform any smart business strategy.
Unfortunately, most companies aren’t making use of the goldmine they’ve got in social media. A Kalypso study found that fully 70 percent of brands start out with the intention of using social as part of their research and development process. In the end (which is where it counts), only 33 percent of those companies actually have any kind of plan that will let them follow through on those intentions.
That’s a big waste. There are tools that can help you analyze the info you’re gaining on social. Google Analytics is a great (and free) starter point that can help you sort through that pile of social media demographic data. Ultimately, that data is the key to understanding the specific characteristics of your audience — and learning more about what they want and need.
Your brand is going to thrive best when you learn to be responsive to your customer’s desires — and social can help you make it happen.
Customer Retention Through Direct Engagement
Social is how you give an otherwise faceless brand a personality. Your brand’s expression on social will actively shape the way that people feel about what you make or do — and that may be the ultimate key to retaining customers. (If you don’t already realize how important that is, consider this: It costs anywhere between 5 and 25 times more to get a new customer than it does to keep one you already have.
Developing a solid brand personality is important for several key reasons:
- A brand identity can effectively guide all your company’s output — no matter what team produces it or through what medium. Effectively, your brand’s personality provides a consistency that your customers can come to rely on.
- Your brand’s personality is how you can effortlessly set your brand apart from every other company selling something similar. Customers frequently seek out brands that they strongly identify as being like themselves. The “face” your brand presents to the world plays a pivotal role in the customer base you attract.
- Properly-Crafted brand identity will help you reach your target market. Consumers do seek out brands that they identify with already. Yet, consumers will also seek out brands that reflect who they aspire to be — whether that’s urban, edgy, sophisticated, or sleek.
- Social also gives your customers the ability to feel like they can directly connect with you and your business. Whether they have a compliment or a complaint — they can reach you on Facebook, Twitter, or Instagram — or any other social channel. Consumers want to be heard. Social gives you the opportunity to reassure them that they’re listening.
How important is that two-way connection on social to customer retention? When customers actively engage with a brand on social, their spending increases by 20 to 40 percent!
Referrals That Will Grow Your Business
Word-of-mouth referrals have been the lifeblood of the business world since the dawn of commerce. Today, instead of getting a recommendation from a neighbor over the backyard fence, consumers are far more apt to hop online and look for a referral. Word-of-mouth is what ultimately influences as many as 50 percent of all purchases.
Maybe even more importantly, happy customers tend to share their thoughts with others. When a customer is happy about your brand, your product, or your service, they’re more inclined to get back online on Twitter, Facebook, or Instagram and tell others! One positive tweet from the right customer could go viral. That alone could gain you more new customers than all the advertising dollars in your entire budget!
Social doesn’t just take customers on a journey with your brand. Social interaction also builds a relationship that can last for that customer’s lifetime. While each social campaign naturally has its own value and own metrics, research, retention, and referrals are the ultimate analytics you need to master to get the most out of your social media efforts.