How Social Media Impacts (or Doesn’t Impact) ROI
The more social media followers, the better — right? As is often the case, it’s not quite that simple.
A big boost in your Twitter followers might give you a warm glow inside, but it’s not going to pay the bills. Likewise, a popular post on Facebook might collect hundreds or thousands of “likes,” but it doesn’t always follow that your bottom line will receive a boost.
To ensure that your social media presence is effectively advancing your company and brand, you’ll have to hit the right notes with your customer base and navigate a minefield of dodgy shortcuts. And it’s important to understand exactly what you’re getting (and what you’re not getting) from your company’s investment in social media.
What Are Those ‘Likes’ Worth?
Think of a “like” as a high-five from your customers. You’re not going to be able to expand your business or drive revenue on the strength of a high-five, no matter how vigorous it is or how many you receive. Every social network has its own metric for measuring success — “likes,” retweets, and favorites — but it’s not easy to convert these symbols of support into cold, hard cash.
There’s no shortage of people looking to put a value on your “likes” for you, though: EContent Magazine estimates that each “like” is worth $3.60 annually, while the HBR Blog Network came up with a detailed formula to help you work it out yourself. You’ll find just as many commentators suggesting the figure is actually zero.
I’ve worked with big Fortune 500 companies and very small businesses, and within that range of experiences, I’ve found that it doesn’t much matter how many fans and followers you have. It comes down to what you do with them.
How to Make Those High-Fives Count — Literally
So, what’s the process for unlocking the tangible value of your social media presence? You should begin by thinking of your network as a complete ecosystem. You need to build engagement, and then you need to monetize it. You wouldn’t try to sell to an empty room, nor would you fill the room and promptly leave your audience in the lurch.
- Listen. Listen to the consumer buying signals on social media, and familiarize yourself with what your customers are saying. Pay attention to what they say about their needs. Respond with unique coupons or offers for your followers.
- Incentivize. If customers take advantage of one of your offers, give them the opportunity to share it with their friends. This philosophy of customer-organized sharing is at the heart of most successful social media marketing.
- Scale. These one-to-one conversations and unique offers will give you a better idea of both how to reach your customers and what they want. Build on these successes with targeted advertising (on Facebook or Twitter), which will amplify your reach.
- Supplement. Use your social media accounts as a bridge to more in-depth content for your followers. You could link to a blog post on your company website or to a free e-book available only to users who provide an email address.
Each of these ideas leads to new customers or at least new prospects who might later become customers. The end goal is to make a sale, but growing a community through interesting posts and conversations is still an important part of getting people into the room.
Avoid the Fakes
You can buy social media followers cheaply and easily, but as with most business shortcuts, you’re not really getting value for your money. You might not be quite as high-profile as Mitt Romney, but you will attract negative attention all the same if it looks like you’re paying for your popularity (or, even worse, if you actually are paying for your popularity). What kind of message does that send to potential customers and clients?
These fake followers boost your numbers but hardly offer any kind of engagement, which can leave your social media pages deserted — online ghost towns. Again, this isn’t the impression you want to make. Organic and honest community-building is the best way forward. It takes longer to achieve, but it provides more rewarding and long-lasting results.
Additionally, it’s easier to spot a fake than you might think. Spammy Twitter accounts don’t hide very well: They have around zero followers, rarely tweet, and often keep the default egg icon as their avatar. A lack of community engagement on Facebook is another giveaway, as are sudden, sharp rises in follower numbers. The money you spend will make you look more popular, but only at first glance.
Like any tool, social media is most powerful when you know how to best use it. You must be serious about turning your fans and followers into paying customers, as well as attracting them to your social networks in the first place. Only when you’re engaging genuinely and providing real value to your following will you see a real return on the time and effort spent on your social media strategy.