This week, I read an interesting article about a topic that can be considered the elephant in the room when it comes to social media: return on investment. The article points out that we have been in the social media game too long to answer questions about ROI by redirecting attention to engagement and earned media. Instead, engagement should be a means to the end of generating revenue by converting fans into buyers.
Managing social media for a neighborhood, my ROI isn’t measured in revenue since I am not selling a product, but I do feel the need to prove to the neighborhood association that I’m meeting their goals. Since the neighborhood is new to social media, the initial goals revolve around growing an engaged community. So when I noticed that the reach and engagement for posts about Stockbox, a new business in the neighborhood, were much higher than for the average post, I decided to contact the owner to discuss a partnering for a promotion. Through this promotion, the neighborhood stands to gain some of the store’s 1500+ Facebook fans, and also show that we are attuned to the topics the residents care about.
In what the article calls “social marketing’s heritage,” growing an engage community was the only purpose of social media. The article urges businesses to more past this stage into an era when the engaged community translates into real revenue impact. As I said, my goals managing social media for the neighborhood are not increasing revenue, but once I have grown the community I will set new goals that have to do with real world behaviors the neighborhood would like to see from their social media fans. For example, we use the page to announce events, so in the future one of goals might revolve around increasing the amount of social media fans who actually attend the events. I want to see some sort of return on the time the neighborhood invests on social media.
How important is it for social media to show a real impact on revenue (or other metrics of success)?