There’s often debate between marketing people and financial people at any company. The financial people want hard numbers. They want to be able to measure specific ROI, or return on investment, for any marketing plan that’s implemented. What they don’t understand is that many marketing strategies, besides promotional deals that have expiration dates, often work in the long term. Many marketing campaigns work to build a brand so that the company stays top of mind in the consumer. Many times, this is hard to measure, or can’t be measured at all. This is certainly the case with social media. It’s still a relatively new marketing medium and the right tools to measure its ROI simply don’t exist yet.
The fact that social media marketing ROI is hard to measure is part of what has prevented many businesses to jump on board. Even though it’s a great way to communicate with a target audience, some CEO’s, Presidents, and Vice Presidents are still hesitant to get involved. It takes time and effort to do social media well. In order to implement a social media marketing strategy correctly, it takes hours of the day. While some companies even choose to hire someone to fill a social media specific role, other companies can’t possibly understand the point of spending salary money on something that can’t even be measured.
There are some people out there that argue that it is possible to measure social media marketing ROI, but what they are measuring isn’t really ROI, per se. ROI is a monetary measurement. If I spend “x” dollars, I should receive “x” dollars back in return. Sure it’s possible to measure how many new fans, followers, connections, replies, views, and retweets that a company gets on social media a month, but that’s not really measuring ROI since none of those things specifically correlate with the amount of business or dollars that a company gets.
However, just because it’s difficult to measure ROI, that doesn’t mean that social media doesn’t contribute to the bottom line. It certainly does if it’s used correctly because it’s a great way to build relationships with potential customers, clients, prospects, and other stakeholders. The only problem is that it’s hard to attribute the credit to any one medium. While some believe that the last point of entry should be credited with the conversion, that might not have been where the actual decision was made. Success is usually found through using a combination of efforts. A new client may have read your newsletter, connected with you on LinkedIn, and followed your blog before signing up for services. Which was it that landed the sale? It’s hard, if not impossible, to measure if anything is more important than the other when it comes to social media. Likely, it’s the fact that the company had a presence across all of these platforms that got the attention of the client. Therefore, it’s important to utilize as many social tools that are available to you because you never know what will prompt that final decision to buy your product or use your services.