What's the ROI on Social Media

The one most Frequently Asked Question in social media circles is...

Q: What's the ROI on Social Media?
Here's an article I posted to my LinkedIN which fetched a few comments.


3 steps to measuring social media ROI

ROI = (gain – cost) / cost People who work in social media often face this problem: Budget. ROI is a business measurement. It doesn’t care whether you’re investing in SM or pumpkin farms. ROI has non-variable values and a concrete formula.

Luigi Cappel Metrics are really important to help justify the investment. Time is just as important as marketing spend. What is your worth to the company over a year? Not what you are paid, but what revenue comes from your efforts. Divide that by 2,000 hours for a year to get an hourly rate. Of course who of us only works 2,000 hours, but effectlvely, thats the official measure. 

Of course we need to start with a marketing plan and KPI's and a way of isolating what came from the social media and what didn't. How many of us ask how a new client found out about us?

Is social media just online, or is what we did last night also social media. Glad I finally got there Amar:)
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Amar Trivedi - Keeping Madness Alive Nice one Luigi. I heard this at a seminar recently... Q - How does one measure ROI of Social Media A - The same way you measure the ROI on your phone. I think it made sense. After all, it enables you to make connections faster & further than ever before. Keyphrase: Take it offline... - that's where SMCakl plays a part. Putting a face to the Twitter handle. Exchange cards or QR codes. Have a chat. From there... take it from conversation to conversion, coffee to champagne :)
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Michael Q Todd Followed the event last night on Twitter. Great stuff guys! 
The ROI on Social Media for a business is that they will still be in business in 2 years ____________________________________________________
Amar Trivedi - Keeping Madness Alive Thanks Michael. Glad you enjoyed the event out there in Japan. And that's a seriously cool comment on the ROI of social media. Hope to meet you at SMCakl. Let us know when you're in Akl next. Cheers!
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And here's another good article via emarketer.com...

As Social Spending rises, which metrics are CMOs focusing on?

And... here's the answer to that most FAQ...

Infographic by MDG Advertising Click on image for enlarged view

Many thanks to Camellia Yang for finding this lovely infographic.
Q: What is an Infographic? A: A flowchart on steroids.