What Is Your ‘R’ for ROI in Social Media?

A few weeks ago I wrote “Can Social Media be Measured?” There was a bit of debate among readers in the comments, so I’d like to circle back around and address a burning topic for companies that are looking to venture into social media marketing.

You should definitely measure some things — check out the “Measuring Social Media” white paper from Serengeti for some examples. However, each company needs to define its own “return” in their ROI when they implement social media strategies. Everyone is different.

Most for-profit companies and organizations have a bottom line that’s based on how much money they make from sales of their product or services. Companies that don’t make a consistent profit won’t last long. Many activities go into how a company makes its profit, and how those activities fit into the scheme of things is via ROI.

Non-profit organizations might have a bottom line that’s based on donations, funds, or even acquisition of volunteers to keep them afloat, so their ROI can be defined in another way compared to a for-profit business.

Most companies making money have a bottom line, no matter if it’s direct or indirect.

However, defining the “return” on a social media activity doesn’t always have to be a direct sale. It’s actually very rare to see a “click to purchase” from a mention in social media. This is why it’s a difficult to sell senior leadership on the idea that attempting to tie your direct return to a sale will prove that social media works.

Companies trying to implement social media strategies solely for the purpose of directly selling products or services will find they will be horribly disappointed and have senior leadership screaming at them that “this social media stuff doesn’t work!” This has happened too many times to count.

It isn’t that social media doesn’t work. It’s that both their reason for implementing it (their return) and their measurement of success for that return wouldn’t work for marketing in social media community.

There are many examples of social media success where companies didn’t tie sales to being the success measurement for the strategy the implemented in social media. When Dell first ventured into social media by way of the Direct2Dell blog, they were out to bring down the number of negative comments that were being made about the company by directly addressing customers in social media communities.

At the time Dell ventured into social media, they were being pummeled by Jeff Jarvis, who coined the term “Dell Hell” and, shortly after they started the blog, by the exploding battery situation in which a Dell laptop caught on fire in Osaka, Japan. They had really started listening to the social media world in April 2006, and knew they had big issues when it came to how people viewed the company’s products and services.

Dell considered its return, in the case of starting Direct2Dell, as the decrease of negative comments and sentiment in the social media communities. According to Lionel Menchaca when he addressed the Blog Potomac crowd in 2008, they saw incredible success and considered the blog a very successful return on their investment. So much so it encouraged them to invest fully into other social media projects, such as IdeaStorm and very active Twitter accounts.

You can have several reasons you want to implement a social media strategy, those can all be measured as a “return.” Maybe it’s to increase the number of subscribers to your blog, or get people to your Web site to take a quiz of some sort. Perhaps it’s to get people to participate in a contest that raises brand awareness. All of these can be measured and, if the proper research around what successful goals should be in place, can be measured for success or failure.

So what are some “returns” you can measure? Here’s a high level view of “returns” you can measure and assign goals to.

Facebook/MySpace (social networking sites in general):

  • Number of fans/friends
  • Number of comments per day/week/month
  • Number of discussions started by fans


  • Number of qualified followers (qualified meaning actually people, not bots)
  • Number of retweets


  • Number of comments
  • Number of subscribers
  • Number of links posts get
  • Number of retweets

Forums/Message Boards:

  • Number of new members
  • Number of posts per day
  • Number of topics started per week
  • Number of active members per month


  • Number of views
  • Number of comments
  • Ratings
  • Number of subscribers/friends

Brand Lift/Sentiment:

  • More mentions of brands/products/services
  • Increase positive sentiment
  • Decrease negative sentiment

There are many more ways you can measure, and many more social media sites offer different types of measurements to its members. Tools can also measure certain things, but most of what you’ll want to measure will take a lot of manual work.

The last, but certainly not least, piece of this puzzle is how much of an investment you’re putting in. That investment isn’t just how much certain software costs, or an employee’s time to plan, implement, and measure. It’s also the equipment that you might have to invest in, whether it’s servers or T3 lines you need to bring in to handle traffic to your servers that support the new community you’ve launched.

All of this must be figured into your strategy and accounted for when figuring out whether the “return” you’re getting is worth the investment you’ve placed into your social media strategy.

Related reading

Top 19 Instagram marketing tools to use for success
Eight tips to get the most from your Facebook page in 2019
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