Social Media ROI: Social Shares Are Worth Real Dollars!
Ever thought about exactly how much one of your Facebook fans or Twitter followers might be worth? In terms of real dollars? Well, Chompon set out to figure just that out and came back with some interesting results:
Unfortunately, these numbers don’t necessarily mean that every time someone tweets about you, it’s going to translate directly into $5 or every ‘Like’ is going to net you eight big ones. Chompon had to work with the following assumptions:
- “For shares and tweets, we were able to directly attribute sales to the original action, so we simply took the total revenue attributed to each action and divided it by the total number of shares/tweets.”
- “For likes and follows, we had to estimate attribution by looking at our traffic references and subtracting out purchases made through shares/tweets as well as purchases made through direct traffic.”
- “None of our analysis captures long-term value of customers acquired through these social channels – which means the true value per action should be even greater.”
- “Gross revenue depends on the products/services being sold, but due to the diverse set of ChompOn publishers, we still feel the comparison between actions is reasonable.”
It’s hard to make any concrete conclusions about social media ROI, but this type of research is a great start. Clearly there is real value in social media and some kind of real return on investment. How much and how quickly goals are reached are harder to estimate and would presumably vary greatly across industries.
What we do know is that a solid presence in social media is an invaluable tool for creating, keeping, and deepening brand loyalty. We also know that those people that are connected with us online are more likely to make purchases and spend more than those who aren’t.
An investment in social media is a must and it doesn’t have to break the bank. Some of the most well done social media efforts came out of just jumping in and experimenting. (See Blendtec and Comcast) All you need is some serious planning, the basic know-how, a dedication to being genuine and caring, and a willingness to keep listening and adjusting to your online community. We know you are genuine and caring, let us help with the rest.
Let us know what you think about Chompon’s results. Do you think these numbers are too high? Too low? Were their assumptions fair and realistic? What kind of results have you seen with your own efforts?