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How tangible is social media ROI?

A new study published by Pure360 found that three quarters of people say they don’t notice marketing messages on social media. 

This runs contrary to the mainstream consensus of social media which is that it forms an essential part of a companys marketing strategy. Today, we have social media consultants and experts – who attest to the perceived importance of the right tweet, at the right time.

However the return of investment (ROI) of social media has always been contested. It seems too vague, arbitrary and flooded a medium to make a company shine in the eye of a consumer. 

If the airline Emirates tweets about its new inflight services, it isnt the same as appearing in an advertisement in which a consumers attention is more secure. 

Most users follow hundreds – and some several thousands – of accounts. Even though Emirates has 88,600 followers, it’s likely a scant number of followers are seeing them; 29 per cent would be a high estimate.

This isnt to say companies shouldnt have a social media presence. We know consumers like to express their taste for brands and companies by liking and following them. The ability to express affinity with a company and reach out to them also creates a relationship between company and consumer. 

Finally, social media provides a great way for companies to tailor their image day-by-day week-by-week. Some prefer to post news thats important to their industry, others to be light, engaging or funny.

The trouble comes when social media is asked to provide a statistical ROI: how many click-throughs are there or how many sales per tweet (or, perhaps more relevant, how many tweets per sale), for example. 

There are options, such as ‘closed-loop reporting,’ a technique of watching a visitor become a customer, through from Twitter to purchase. From there you can even see how individual tweets did. 

This, however, still provides only a birds-eye view of consumer behaviours which don’t reveal the whole story. Hence the rise of careers dedicated to this space.

The difficulty isnt linking social media activity with revenue, which at a very fundamental level can be done quite easily, it’s also in establishing the influences social media presence is having on a consumer’s perception of the brand.  

These soft values, creating a less tangible impact on the consumer, are still very important and can in fact be integral to creating loyalty and improving public perception. 

While companies should be encouraged in taking their social media seriously for the soft advantages of building a personality and offering consumers a way to connect, it shouldnt hold out for fiscal returns.

Related: What you can learn from Zoopla about how to succeed on social media

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