Social media marketing can be a very lucrative way to ensure that your audience hears about your programs, products and offerings. But, if you begin without a plan at all, it will be hard to know whether what you’re doing works or not. Each time you decide to do anything on social media, you need to set a monetary or numerical goal for the action so that you can measure the results.
1. Set Your Conversion Goals
There is no way to track your progress if you don’t know what your conversion goals are. Making a goal before you do any action is imperative for your success. Whether the goal is to make a purchase, fill out a form, click to the website or sales page, download a report, engage with a post, buy something or something else entirely, ensure that you know what the goal is and that it’s something which is measureable that you can track.
2. Track Conversions
Once you have goals for your conversions you can track the results. They’ll be noted in terms of reach, traffic, leads, customers, and ultimately conversion rate. “Conversion” in this case only means that they did what you wanted them to do. It doesn’t necessarily mean that they made a purchase; maybe they downloaded a form and sent it back, or they did some other action that you wanted them to do.
3. Determine the Value of Each Conversion
There are some theories that you can use to attach a value to each conversion even if that conversion wasn’t a “buy”. If you have historical data to look at, each of the people you get into your list and each of your actual customers have a lifetime value.
If you do not have historical data you’ll have to try to guess at what their potential lifetime value is, based on the products and services you have in your product funnel and the industry average in terms of sales. Once you know the value of each conversion – even if it’s an average or a potential value – it will help you to know whether or not the spend is worth it as you move forward.
4. Define Value by Channel
You don’t just want to figure out the value for your social media overall; you definitely want to narrow it down and figure out how much you’re accomplishing with each channel. If you’re doing great on Facebook, but lousy and even losing money on Instagram, you have a choice to make. You can keep throwing good money after bad, or you can put your investment into Facebook. Just slip the numbers into a little spreadsheet to keep track and it won’t be very difficult to compare.
Note: “value” doesn’t have to mean that you made money directly; figure instead the value of having that new person on your list.
5. Calculate Total Cost
As you’re figuring out your costs, don’t forget to charge yourself for your own labor. Fees, labor, graphics, copywriting, etc. all are costs associated with marketing via social media. Most people realize that they should consider outside labor, but they often forget to attach an amount to their own labor as they work with social media. If you don’t do that, you’re going to get numbers that don’t take into consideration the real costs involved in the things that you do.
6. Finalize Results Calculations
Make a little chart that helps you determine the percentage return on investment for every channel and overall for your social media marketing efforts. It’s rather a simple formula that you can plug into your spreadsheet. The percentage return on investment is easy to figure out. To get the ROI, just subtract all your expenses from your value. Divide by 100 to get the percentage return on investment.
With this information you can compute the value, costs and return on investment in total and per channel. If one channel is not getting good results, you can change things up on that channel completely or you can just put your resources into what’s working.