Cute video on the delu­sional expec­ta­tions some CEOs have about social media ROI.

In my 6 years of cor­po­rate and small busi­ness social media con­sult­ing, I’ve come to believe that the biggest prob­lem around social media ROI is fig­ur­ing out which dig­i­tal mar­ket­ing efforts should get credit for a con­ver­sion. It’s easy to say that social media needs to prove that it deliv­ers ROI, but com­pa­nies make that very hard to do with the ana­lyt­ics pro­grams they have in place to track conversions.

Most web­site ana­lyt­ics pro­grams attribute con­ver­sions to the most recent refer­rer source for a par­tic­u­lar vis­i­tor. If they came from a Google AdWords ad, it will get the credit for the con­ver­sion. But it’s much more likely that a cus­tomer actu­ally decided to buy your prod­uct because of expo­sure to your brand in var­i­ous chan­nels (i.e. A search bring­ing up your organic list­ing, your email list, your twit­ter and Face­book links, then finally your PPC ad). Which of these chan­nels should take credit for the con­ver­sion? They were all responsible.

Multi-​​touch attri­bu­tion, unlike the “last-​​touch” model most com­pa­nies employ, allo­cates the con­ver­sion value across all of your mar­ket­ing pro­grams — all touch points receive an equal share of the credit for the con­ver­sion. Since social media is rarely a last touch refer­rer, and tra­di­tional web refer­rer meth­ods break down in social chan­nels, a multi-​​touch mode of ROI track­ing works much bet­ter to give mar­keters the ROI jus­ti­fi­ca­tion their CEOs are demanding.

Addi­tion­ally, build­ing bet­ter links with cam­paign, con­tent, medium, source, and term para­me­ters built in, is an inte­gral part of the multi-​​touch mode of mea­sur­ing social media ROI. Obvi­ously, adding all of these addi­tional para­me­ters will result very quickly in an unweildy URL, so bak­ing all of this inside a short URL is the way to go. The only prob­lem with many short URLs is the one I men­tioned above — the ana­lyt­ics pro­grams gen­er­ally only actu­ally attribute a con­ver­sion to the most recent referrer.

Like any new mar­ket­ing chan­nel, we’re see­ing social media con­tinue to make its way through grow­ing pains as it reaches scale and matu­rity. The exper­i­men­tal and promis­ing sets of tools and method­olo­gies in the works can pro­vide real answers for marketers.

Send me a line if you’d like to chat about some of the inno­vate social media ROI tools I’m using with my own clients. I’d love to chat with you about how they can also help you mea­sure and boost your social media conversions.

Share/​Save