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How to Improve Social Media ROI

Michael Meyer by Michael Meyer
February 29, 2024
in Blog, Get Inspired, How To, Social Media
How-to-Improve-Social-Media-ROI
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The average return on investment (ROI) for social media marketing is $2.80 for every $1 spent. Despite this proven potential, many companies struggle to make their social efforts pay off.

In this post, we’ll break down ways to calculate if your social efforts are worth it and provide tips to improve social media return on investment (ROI). Spoiler: It’s not just about vanity metrics like followers and likes!

What is Social Media ROI

Simply put, social media ROI measures the business results you gain compared to the costs of your social media activities. It could show how a social media post generates leads, website traffic, or brand awareness.

A simple formula exists to plug variables in and see your ROI percentage. The formula is:

(Value from social efforts – Social media costs) / Social media costs x 100 = Social Media ROI

The “value” might be revenue, leads generated, or other business objectives reached. Costs are what you spend on social media management tools, advertising, staff time, etc.

How to Improve the ROI of Social Media

It is time to uncover steps to increase your social media ROI: 

Know Your Audience

You have to know who you’re creating content for. Detailed audience research guides your content marketing efforts, making posts more tailored and relevant.

Use social media analytics and poll your followers to uncover what interests them. Find out preferred content formats, posting frequency, and conversation topics. Know what makes them tick before you try to attract their attention.

The best thing to do is to build buyer personas. For example, a SaaS company might create personas for a small business owner, C-suite executive, and marketing manager. 

Set the Right Goals

Set SMART goals to focus your efforts and objectively measure success. SMART stands for:

  • Specific
  • Measurable
  • Achievable
  • Relevant
  • Time-bound

Rather than vague goals like “generate engagement,” define clear objectives like “Increase website traffic from social media referrals by 20% within three months.”

Having specific, measurable goals helps you understand what works and where to improve. It also guides your content strategy. If one of your goals is to drive website traffic, you’ll focus on creating content that leads people to your site.

Have a Clear Understanding of Each Social Network Algorithm

Every social media platform uses algorithms to filter content users see. You need to understand how each platform’s algorithm works to create content that ranks highly and reaches more people.

Some common social media algorithm ranking factors include:

  • User Engagement
  • Relevance
  • Recency
  • Content type

For example, Twitter’s algorithm favors recent, location-based content since it’s designed for real-time updates. YouTube recommends high-quality videos likely to keep viewers watching.

Create Content Your Audience Loves

Quality content tailored to your audience is another key to social media success. Low-effort posts made purely for volume are painfully obvious. They tell your audience you don’t care about them and only want their attention. 

Instead, tell compelling stories and convey your brand’s authentic personality. Use interesting media like photos, videos, and graphics. Video content has the edge here, as it generates 1,200% more shares than text and images combined, according to HubSpot. 

Improve Engagement

Engagement shows platforms your content resonates, improving its reach. Ways to engage followers include asking questions and running polls or contests. It’s also a best practice to respond to messages and comments. 

Post consistently, too. Businesses posting weekly on LinkedIn see 2X more engagement than sporadic posters.

Leverage Influencer Marketing

Influencer marketing is highly effective—an estimated $6.50 is gained from influencer posts for every $1 spent.

Work with influencers who genuinely like your brand and actively engage their established audience. Speaking of their audience, they should be aligned with yours. For instance, a CRM product sponsor chooses content creators in the B2B space, not fashion influencers.

Make sure to track engagement on sponsored posts using unique links or trackable hashtags.

Track Your Competitors’ Performance

See what kind of content your competitors publish and how followers react. This intel informs your social strategy with audience-vetted ideas tailored to your niche.

Monitoring competitors also highlights potential gaps you can fill in the market. For instance, maybe all your competitors are publishing detailed guides on the same topic. You could switch gears and create a visually appealing infographic or educational short-form videos instead. 

Capitalize on Lead Generation

Once your new social media strategy increases traffic and engagement, it’s time to put that audience to work.  

Entice visitors to exchange their contact info for lead magnets like exclusive content, special offers, free trials, and downloadable tools. 

These will generate qualified leads to nurture toward conversion. The goal is to move them through the funnel by building trust and authority. 

Integrate Behavioral Insights into Your Strategy

Don’t just guess what your audience wants—look at the data. Analytics provide behavioral insights to improve your social content and strategy. Most platforms have an integrated analytics tool, such as Facebook Audience Insights or Twitter Analytics. 

Use these to identify trends in audience behavior over time. Track metrics like click-through rates and conversion rates. Then, use this data to tailor content that performs better.

Final Thoughts

While social platforms make it easy to publish content, simply posting doesn’t guarantee you’ll see business results. Take the time to understand your audience, fine-tune your strategy, create high-quality content, and analyze performance data, This will you set yourself up for social media success that pays off.

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A fall-themed influencer post showing a cozy indoor setup with warm lighting, books, and a hot drink.

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