The Real Social Media ROI Formula

In order to increase the share of Social Media advertising in the total traffic to our website, we need to emphasize more on the Social networks. Where people spend significant time in the changing trends .Social media SEO can be used to achieve our target to be among TOP results in Web searches and in social networks as well. In order to beat our competitors, we need to be updated with the latest advancements in the field of Social media SEO.

Social Media ROI

                                                                                   Credits: www.branddrivendigital.com

To track the real value of ROI from social media, first we need to monitor the amount of traffic really coming in, which intern can be compared to traditional traffic from our implemented SEO, and we can judge the ROI in percentage. Having more followers (In terms of Likes, Followers, Views, Comments and Shares) increases our total visibility which can be linearly or exponentially linked with the promotion we’re doing depending on the virility of the content we are promoting.

General ROI formula

ROI = (Gain from investment-Cost of investment) / Cost of investment

Got the below formula from face book –

We then can depart from ROI = Fans/Reach/Engaged Users – Money/Time Spent

So, to explain above ROI can be maximized having more engaged users in our new/innovative content.

If any business strategy includes following business fundamentals then social media gives grate ROI

·         Cost reduction (Reducing customer service cost)

·         More revenue

·         New customers

·         Engage Existing customer

·         Brand awareness

Social media offers collaborative platforms that allow consumers to share opinions and experiences with friends, family, and followers. Such open environments, however, also present companies across industries with countless opportunities to gather valuable insights and interact with current and potential customers. Through social media, brands can directly impact the consumer’s perceptions and purchase habits.

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Comments

  1. says

    Hi Jitendra,

    Oh wow. Nice ROI formula you got there. I didn’t know that it has to be divided with Cost of Investment.

    Interesting and shared on Triberr!

    • says

      yes I do consider the time factor Lisa. If you want to calculate ROI you’ll need to understand both the value of what you’ve invested (in money) and also the the value of what you’ve got back (in money). ROI as a metric is only useful (and indeed should only be used) when looking to understand how cost-effectively various tactics have performed historically.

      Here’s how you calculate ROI: gained from investment – cost of investment / cost of investment

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