A report created by w3haus - creative digital agency (www.w3haus.com) on strategies on how to determine the Returns on Investment (ROI) you can achieve through social media marketing efforts.

1. Social media -
But does it
make money?
we can’t stop moving

2. 
Can social media provide roi?
Short answer:
If executed correctly, Social
Media can provide reliable
returns as well as be an
invaluable marketing tool.
For the longer answer, we must first go through some basic concepts...

3. 
ROI Return On Investment
Keeping it simple: you put money into marketing and expect
sales to increase as a result. If you make more profit on sales than
you spent on marketing, that is a (positive) return on investment.

4. 
Types of ROI for SM
Social Media, if done right, is most often used to provide the following types of ROI:
• increase in brand equity,
fidelity and loyalty
ROI
• improved brand perception
• efficiencies in customer
satisfaction / service
• increased sales
• cost-effective customer insights
Social Media and research
• efficiencies in PR
• efficiencies in advertising
product and service launches

5. 
B
Where am I?
To establish ROI, you need to know (and measure)
where you are and where you want to be constantly:
A
where you
want to be
know numerically what
your goals are
where you are
example: sales, footfall, clients database, site
traffic, customer sentiment, brand equity, etc.

6. 
Here is the big problem
Most companies don’t have the tools in place to measure where they are
in respect to their goals. This can be the single biggest hurdle to
measuring ROI in social media.
84% of companies
don’t measure ROI
in social media
source: Emarketer

7. 
Measure, measure, measure
To Know whether you have had any returns, you need first of all to set up ways of
detecting the real impact of social media on your returns. Each company will have
different ways of measuring this and different goals - perhaps you will need to start
from scratch, but these measurements are essential to analysing your returns.
time spent interacting Blog posts
Sales loyalty
digital leads
Site visits biggest spenders
Number of followers
referral links
returning visitors Fans
Positive mentions
Footfall
Negative mentions
Clickthroughs
customer feedback
efficiencies
*Each brand will have a different set of measurements relevant to them, the above are just a few examples.

8. 
you need something like this
In our quest to map out the effects of Social Media and ROI, we should have
something like this:
sales
social media activity
sales
normal sales for period
time

9. 
Correlations
Once you have you measurements in place, you need to look for correlations
between data. This is the secret to measuring ROI in social media.
sales
social media activity
sales
normal sales for period
time

10. 
Correlations
Once you have you measurements in place, you need to look for correlations
between data. This is the secret to measuring ROI in social media.
sales
social media activity
sales
normal sales for period
time
positive correlation no correlation
successful social media campaign unsuccessful social media campaign

11. 
disclaimer 1! disclaimer 2!
Correlations between measurements should not be Just as correlations don’t give you 100% certainty, we
mistaken for causes. Just because something should also make a note about ROI vs Marketing: ROI
happens when an event takes place, does not mean is a financial measurement and Social Media is (in this
it was directly caused by that event. Correlations are context) a marketing effort. Marketing does not sell
here to help identify ROI, they do not offer 100% directly anything, but rather increases the probability
certainty, but are our best tool for measuring ROI in of sales. So by trying to match ROI and Social Media
Social Media. we are measuring much more the probability of sales
than sales themselves. We are looking at influence.

12. 
Moving on - Define Success
Before going out and trying to find out ROI in Social Media, you need to define
what your goals are in a measurable way.
What does success for your brand look like?
Brand Awareness More site visits, more mentions in social
media, fan pages, high ranking SEO, etc
In store sales, online sales, user journey in
Sales online purchase process, higher conversions
Video demonstration views, time spent on website,
Brand Engagement number of shares of embedded content, etc.
Number of customer interactions, Visitors to
Customer Service
education resources, reduction of calls etc
*Each brand will have different measures of success relevant to them, the above are just a few examples to illustrate possible real world scenarios.

13. 
A sample social media campaign
campaign landing page sales roi
• Page views • Increased? • Extra Sales /
• Visitors • Correlation with Social Campaign cost $$
• Avg Time spent on page media data? • Potential customers
• Bounce Rate • Increase in purchase in database
• User Journey attempts? • Customer Insight
• Increase in landing • increased awareness
page visits?
• Increase 25% Sales through Social Media Channels
Example Goals • Increase positive mentions by 50% (reduce negative by 25%)
• Achieve average of X views of landing page per day

14. 
Measured! Now analyse your data
Do you see any trends? Is traffic up to your store
after posting on Facebook or Twitter?
Does store traffic correlate with more sales
when evaluating that same data? Does a
higher sentiment analysis on Twitter lead to
more sales or more visits?
Finding trends and tracking them back to their
point of origin is the key to measuring ROI.

15. 
Quantity vs Quality
Be careful when analysing data - sometimes numeric growth does not always
translate to results. It is very important to qualify your interactions and not just
be happy with increases. But be happy if you can answer yes to some or all of
the following questions:
Are your visitors
returning and is your
Did sales increase with bounce rate decreasing?
increase in hits and
followers/ fans?
Are visitors spending Is brand sentiment
more time interacting online improving as
and viewing more a consequence of your
content? social media presence?
Are visitors
Are fans of your brand spending more time
spreading your interacting and
message voluntarily? viewing more
content?
*Each brand will have different measures of success relevant to them, the above are just a few examples to illustrate possible real world scenarios.

16. 
It comes down to
justifying the spend
Word of mouth has always been effective in increasing
sales. Social Media is the digital equivalent, with massive
amplifying potential (global audience).
Everyone knows Social media can deliver value and ROI,
the difficulty is putting in place the measurements to
prove it.

17. 
But wait, ROI’s not all
You can expect other types of return from Social Media, for example,
increases in:
• Brand loyalty
• Positive association to brand name
• Increased public awareness and
brand recognition
• brand engagement
• improved customer service and
satisfaction
These returns will also translate to sales, only indirectly and will
have a different life-cycle, possibly taking longer to monetise, and
potentially having a much better cost-effect ratio than other types
of marketing campaigns in the long run.

18. 
Brand Equity
If online direct sales is your company’s goal, your sales results will
be your ultimate measure of success. But for most brands, the
biggest value Social Media will provide will be Brand Equity.
In the cluttered world of online communications, Brand Equity is
quite an achievement. Social Media can now make or break a
brand’s image online, with massive repercussions offline.
why should someone
buy your brand over
your competitor?

19. Conclusion

20. 
ROI yes, but not just that...
Once you’ve measured the impact of a successful
Social Media campaign, you know Social Media can
provide good ROI and you can then justify your
Social Media spend.
We have gone over a few different ways of
adapting the return to fit the needs of your
business (sales, footfall, fidelity, brand
identification, meaning, etc).
Don’t forget that ROI is not the main reason to get
into Social Media - you will achieve much better
results if you think longer term brand engagement,
consumer insight and brand equity rather than
short term ROI. ROI will come, but most likely
within months and years and not days and weeks.

21. next steps...

22. 
ok, what next?
Ultimately, we believe Social Media is an important part of any brands marketing
arsenal. Consumers will talk about your brand whether you wan’t them to or not
and there is great value in being part of the conversation.
Get in touch with us at W3Haus and we can answer some of your questions about
how to measure your brand’s ROI in social media campaigns and also other
questions like:
1) What does a social media campaign look like?
2) What should my brand be doing?
3) Which services (Facebook, Twitter, etc) are right for my brand?
4) How would i implement measurements for ROI for my company?
And any other questions we might be able to help you with.
You can reach us on:
rodrigo@w3haus.com
Twitter @w3hausuk

23. 
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london
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For further details, please contact:
rodrigo@w3haus.com
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