Advertising on social media takes time and money, and one would think this investment is important enough to measure the return on investment (ROI) for these activities. However, when the Internet Advertising Bureau (IAB) recently conducted a survey of over 100 agencies, they discovered that 50% of them “make no attempt to measure the financial return from their posts”.
So what are they focusing on if not the financial return? The companies surveyed stated that other social measurements were more important in demonstrating the value of their advertising, such as engagement, (55%) and traffic gained (52%). Although 33% said they did not believe it was important to measure ROI at all, a whole half of the respondents admit to making no effort whatsoever to measure this important metric.
According to Alex Kozloff, the IAB’s director of marketing & communications, this trend will only last a few years, as tracking ROI is still in its “teenage years”. He predicts that as companies began to invest more in social advertising (an expected 33% growth), marketers will start to pay more attention to this area and find ways to effectively measure ROI.
While the results are surprising, it’s understandable that the average marketer isn’t keen on measuring ROI from social. It can take a considerable amount of time, and there is a learning curve that comes into play. The target is not the same for each platform, and quite frankly, what works today may be totally ineffective tomorrow in terms of analyzing metrics. Simply put, there are too many variables to check, and many marketers would rather spend that time elsewhere.
Who is Doing Social Well?
Survey respondents were also asked what companies they believed were “doing social particularly well”. Coca Cola topped the list, with Nike, Virgin, and Adidas close runner ups. These companies were selected by respondents because of their large following and user engagement.
Other notable companies respondents believed were at the top of their social media game included Starbucks, British Airways, Amazon, and BBC.
Commenting on the results of the IAB survey, MoreNiche Social Media Manager James Plumb said; “To learn that almost half of companies aren’t tracking social media ROI is quite a shocking statistic. It means that they aren’t sure if their social strategy is having the desired effect, as well as wondering whether they could be spending their money in a smarter and more effective fashion.”
“Although tracking ROI is notoriously difficult to do in regards to social media (especially with multiple platforms involved) it can be done, even on a small scale by using a simple tracking code with ads coupled with a simple Google Analytics account.”