Jun 19, 2020
If you are sharing content across social media on behalf of a business and pinning your success on whether you go viral and not on social media ROI, chances are you will be deeply disappointed.
Asking clients to invest in time-consuming creative and expensive videos is not a responsible request unless you have a clear plan for how to connect that creative with the right audience and convert their interest into results.
You can balance campaigns that are focused on new customer acquisition by infusing creative into the mix that invites prospects further down the funnel and elevates conversion rates.
By expanding your scope beyond brand awareness campaigns, you can also increase your agency billings with creative that is more directly attached to results.
What Is the ROI of Social Media?
ROI stands for “return on investment” and is key to securing buy-in and budget for your social media strategy.
Using this will allow you to know whats working and whats not, in order to shift your focus and better allocate resources to what is.
In general, social media ROI refers to the sum of all of social media actions that generate value.
Its important to know the ROI of your social campaign because if you don’t measure the success of your actions, you wont know whats working.
How is Social Media ROI Calculated?
Learning how to calculate ROI can open many doors for you and your agency.
Social networks like Facebook, Twitter and LinkedIn are great for building your business’s online presence but lack the capabilities for measuring actions, costs and results.
Before you calculate ROI, you need to know your campaign goals and KPI’s. Knowing what your goals are will help you focus on what you want to measure.
Once we know what the client’s goals are, how do you measure ROI?
If you were measuring ROI by revenue, for example, you could use this simple formula:
Revenue/Investment(work hours, ad budget, etc) X 100= social media ROI (represented as a percentage).
So, if you made $1,000 in revenue from social media on a $500 investment, your profit is $500 (remember: profit = revenue – investment). And then your calculation would be: $500 profit / $500 investment X 100 = 100% return on your investment.
There isn’t one set formula when calculating return on investment, so you can use these other common social ROI formulas for your agency.
So now that you know how to calculate ROI for your social media campaigns, how to you make sure to deliver on those campaigns?
Although there is no cookie-cutter template for social success, below are tactics our social media team executes when creating a complete social strategy.
These tips will help you create a campaign that is measurable and delivers a return on investment for your clients.
Personalized Retargeting
The easiest people to convert into a sale are those that have already expressed an interest.
With retargeting ads, you can reach people that visited specific pages on a website and invite them back to learn more or to complete a purchase.
If you are investing in expensive paid search ads or utilizing programmatic to generate traffic, you can elevate conversions for those campaigns by directing personalized retargeting ads to consumers across Facebook, Instagram, Twitter, LinkedIn, and more.
These relevant social ads can invite consumers back to your website to generate a lead or complete a sale.
For those that are running TV buys, which will either spike your Google searches or drive more direct traffic to your website, you can create content that invites people back to buy after they do their initial research.
With the ability to segment retargeting ads and create social experiences that are tailored to specific age groups, genders, interests or other attributes, you can deliver personalized remarketing ads that are unique to every service or product that a consumer looked at on a website.
Since these retargeting creatives can pay off dividends every day throughout the year, you can justify the increased creative costs by delivering results whenever a new customer is ready to buy.
Custom Audiences Are King
Facebook advertising is unbelievably powerful. One of the best tactics to consider building creative campaigns around is Custom Audiences.
If you have a database of leads that have been generated, warranty registrations, email lists, or a CRM full of people that have already made a purchase, you can deliver tailored ads to those audiences.
Since most social media services require an email and phone number to sign up, the lists you have can be matched with an account so that you can deliver a custom ad.
By running social media targeting ads to people that have already expressed an interest by filling out a lead form or have already bought before, you can drive more sales for your clients.
With micro creative campaigns that are personalized to specific lists and segments within, you can drive more repeat business and convert leads into transactions.
You can also utilize Custom Audiences with Facebook to retarget people that watched your video or engaged with your content, which opens up endless opportunities to build upon your brand awareness campaigns.
If you start off your social campaign with a shiny new commercial, you can follow-up with a sequence of ads that further educate consumers on your offering and guide them toward taking action.
You can also narrow the focus to target people that watched all of the video, as well as apply layers of demographic and psychographic data to narrow your focus to those most likely to buy.
If you find that women, age 18-24, have a higher rate of conversion, you can narrow your focus to people that watched your video and fall into that demographic bracket.
Social advertising is profoundly powerful by itself, and when combined with first-party data you can unlock unparalleled opportunities to deliver personalized advertising experiences.
Lookalike Audiences
Existing customers have unique attributes that extend far beyond age groups, genders, and generic interests.
By tapping into Lookalike Audiences, which is one of the best advertising tactics to deploy across Facebook and Instagram, you can reach people that are similar to your followers.
With algorithms and machine learning mechanisms that are able to dive deep into the unique interests and behaviors of an existing clientele, these platforms can gain a deep understanding of what makes this audience unique and find people that act in a similar fashion.
Which audience you decide to replicate is also important.
You might not want to simply reach people that are similar to your followers, you might want to reach people that are similar to people that have actually bought from you before.
By combining Lookalike Audiences with Custom Audiences, you can reach those that are just like your customers.
Focusing on the people that are most likely to buy will help expand the scope of success with your social campaign.
Always Be Iterating With Split Testing
Many creative shops bill by the deliverable or by the hour, whether that be banners created or videos produced, and split testing is the greatest thing that happened for many creatives.
With social advertising campaigns, the most important thing you can do is create multiple versions of the same ad in order to enhance performance.
Unlike TV where you just have one spot and hope it works out, with social advertising you can test different images, various videos, and sets of conversion-oriented copy to see which ones inspire the highest conversion rates.
Although your instincts will likely be correct as to which one will drive the best results, you can add scientific methods of testing to confirm those suspicions with real audiences.
By testing your campaigns to see which creatives yield the best results, you can see what works and optimize your efforts to deliver the best results possible for your clients.
Maximize Your Social Return
With the unlimited possibilities available today within the social media ecosystem, the need for a large quantity of high-quality creative is only increasing.
When you no longer have to worry about producing creative that speaks to everyone, you can focus on designing personalized brand experiences that speak to the individual.
By implementing advanced targeting, retargeting, Custom Audiences, and constantly refining your approach, you can prove that your creative delivers measurable social media ROI.
