How to calculate ROI on social media
Step 1: Define clear social & business objectives
The first step to calculating ROI is understanding your business as a whole. What are the main objectives, and how can social contribute to those goals?
Step 2: Track metrics that align with your objectives
Now that you’ve determined your social media objectives, the next step is to track their performance.
Many social media metrics can give you insights into how your strategy is performing. But, choosing the right metrics is essential to fully understanding your social ROI.
Step 3: Calculate your social media costs
Once you’ve measured the value created based on your chosen metrics, you can move on to calculating the cost side of the equation.
Social media costs should include all expenses required to create and publish content.
Step 4: Calculate your ROI
You should be ready to input your total value and costs into the formula above to calculate your ROI.
If you’re not a fan of spreadsheets or manual calculations, we’ve built this free social media ROI calculator.
Remember, a positive ROI means you profited from your investment, while a negative ROI percentage means you spent more than you made.
Step 5: Create an ROI report that shows the impact of social
Now that you know your ROI, it’s time to share those results. Your report should show stakeholders how your social media efforts impact the bottom line.