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Measuring the ROI of Social Media Marketing


Is it working? That is the question every business owner should be asking after investing time, budget, and resources into their social media marketing efforts. Are you getting a return on your investment?

Fortunately, almost every major social network offers free analytics and reporting of key metrics such as reach, impressions, engagement rate, link clicks, and more.

One of the most important metrics for measuring ROI is website conversions. When used effectively, social media can drive traffic to your website and encourage users to take a desired action such as sign up for a newsletter, watch a video, or fill out a form. Conversion tracking varies slightly from one social network to the other so we’ve compiled the resources all in one place to help you set them up:


Facebook Insights will provide you with a host of useful data and general metrics. However, to measure website conversions you must create a Facebook Pixel. The Pixel allows you to track events such as page views, purchases, form submissions, subscriptions, and more.

Social Media Return on Investment See exactly how your ad’s are converting

Once you’ve set it up and tested that it’s working properly, you can choose from three different objectives:

  1. Boost your Posts
  2. Send People to your Website
  3. Increase Conversions on your Website

The Website Conversions metric will appear automatically whenever you run one of those three types of Ads. Keep a close eye on how well your Ads are converting to your website and continue to experiments and make adjustments. You can calculate your ROI by taking the dollar amount spent on your Ads and cost of your Social Media Manager’s time and dividing that by the dollar value you have placed on each desired action.

For example, if the average spend of a customer is $50 on an E-Commerce website. You create a Pixel that tracks how many users land on the “Thank You” page after making a purchase. In our example, let’s say we have 100 website conversions after spending $20 a day on advertising costs. Using the normal return on investment equation (ROI = (return – investment) / investment) let’s do the math.

Investment: 30 days of advertising at $20 = $600

Return: 100 conversions at $50 = $5000

ROI = ($5000 – $600) / $600

Monthly ROI= 733%


Twitter Analytics also offers basic reporting with key metrics such as impressions, engagement rate and link clicks. Similar to Facebook, they also have Website Conversion Tracking available to measure the ROI of your Twitter Ads and Promoted Tweets.

Twitter Conversions will appear within the Twitter Ads campaign dashboard.  You can track desired actions such as site visits, purchases, and downloads. The Twitter Business Guide provides step-by-step instructions to help you set up the Conversion Pixel and measure the ROI of your Twitter Ads.

Pinterest, LinkedIn, Google+, YouTube, & Instagram

We don’t need to spend too much time covering every social network as they all offer pretty similar reporting and key metrics. If you are using any of these other social platforms for your business then you will want to invest some time monitoring these as well:

Google Analytics

Another important place to gather social media ROI data is from your website using Google Analytics.

Set up Google Analytics Goals and assign a Dollar Value to specific website actions. Google will automatically calculate the Goal Value in a dollar amount, the Goal Conversion Rate, and the Total Abandonment Rate. You will be able to see exactly how much money each social network is contributing to your bottom line.

Analytics Goal Conversions Your website analytics are a key component of measuring your ROI

For a more in-depth look at using Google Analytics for Social Media Measurement read my blog post “Measuring Social Media Success with Google Analytics”.

So now you have all the tools you need to measure your social media marketing performance, it’s time to plan some campaigns and track some conversions. Don’t forget to learn from your performance and tweak your strategy to maximize results.

Does reading this post make you glaze over and think “I just don’t have time to set this up”? This is exactly the kind of headache we specialize in solving for small businesses. We build and execute high performing social media marketing campaigns for our customers every day, delivering ROI and business growth is something we get a kick out of. So if you don’t have the time or energy to track your digital strategy, give us a call today.

Social Media Management