how to measure social media roi

How To Measure Social Media ROI for Your Business

Business owners seeking help with their social media marketing may desire to learn how to measure social media ROI. However, this process can take a lot of time, stealing hours or even days from a business owner’s other responsibilities. Instead of doing the work themselves, some business owners hire social media management and marketing experts in Abilene, TX.

If you want to work alone on your social media ROI, this short guide will teach you how to measure it to get the most out of the insights it can provide into your marketing efforts.

Defining Social Media ROI

Social media ROI, or return on investment, consists of the value derived from an investment made into social media. A useful formula for calculating social media ROI is as follows:

(return – investment made) / investment made x 100 = social media ROI

For example, you invest $100 in an ad you made $150 off of. Using the formula above, you discover you made a 50 percent ROI. So long as your ROI lands above zero percent, you’ll have a positive return on your investment.

What Metrics Measure Social Media Content Performance?

Business owners can use many metrics to determine their social media content performance. But how do you quantify those metrics with monetary values?

Start by determining the lifetime value, or LV, of a customer, a number that casts an approximate blanket over the customer of how much they’ll spend with a business throughout their life.

If you own a coffee shop, you may expect each customer to have a lifetime value of $5,000. Let’s say you spend $2,000 on a social media ad viewed by 24,000 people. Take that $5,000—the lifetime value of a customer—and divide it by the 24,000 views (or another metric measurement).

In this case, the value of one of those metrics would equal .21.

Now that you have this formula in mind, the main social media metrics a business owner can use are as follows:


Link your social media posts or social ads to certain user actions, such as entering their email to download an item, accessing certain information, or requesting more information. These leads can tell you how well your posts or ads perform, providing you with an important social metric. 


While reach informs you of the metrics of your social media activity, it only shows you how many eyes landed on your post, not the number of people interacting with your brand.


Every marketing strategy should have a goal post you want your customer to reach. Whether you want them to buy something or fill out a quote for a free consultation, conversions reign over other forms of social media metrics. Conversions remain one of the top answers to the question of how to measure social media ROI.


Engagement with social media ads shows how many people enjoyed the ad or post enough to interact with it. Facebook ads, in particular, show the engagement rates of your audience, including likes, comments, and shares. 

Measuring Social Media ROI

Now that you know the basics of calculating ROI and the different types of social media metrics, here’s how you can go about figuring out the ROI for each post or ad:

1. Calculate Your Spend

Most business owners consider the amount of an ad’s budget as the only way to value their spend. However, you must include many other aspects of your social media ads, including:

  • Social media tools and platform subscriptions
  • Content creation software purchases or subscriptions
  • Payment for the use of social media consultants or advertising agencies
  • Salaries, training, insurance costs, etc., for a social media manager or team

2. Connect Social Objectives to Business Goals

Posting a social media ad or post without a goal in mind makes it difficult to quantify how well it performs. You don’t necessarily have to set a financial goal to create a useful social objective. Some examples of ROI signalers include:

  • Lead generations
  • Brand awareness
  • Customer loyalty
  • Employee satisfaction

3. Track the Right Metrics for Your Objectives

Depending on the objective you chose, you can track different social strategy metrics to support the success or failure of a particular post or ad, including the following:

  • Reach
  • Site traffic
  • Conversions
  • Generated leads
  • Generated revenue

4. Build a Report

After tracking all of these different aspects and compiling the information, use it to write a report on your findings. You may want to wait until you can compare other ads or posts to one another to understand the information more thoroughly. This report can show you what types of posts work best and how well your current methods and strategies work.

Ideas for Improving ROI on Social Media Content

When you look at your report and discover you need to tweak your work, you can improve your ROI with these tips:

Know Your Audience

As you build up knowledge of your ROI, dig into the demographics of the profiles that engage with you the most. You can use their information to help you understand what audience prefers to engage with you most.

Create Engaging Content

Do videos, photos, or links work better in your social media posts? Your reports will reveal what type of content best resonates with your audience, allowing you to better tailor your social media presence.

Run A/B Tests and Tweak as Necessary

Try different versions of your posts and see which garners the most attention. As you learn more about what your audience likes, build on that and tweak your posts as necessary.

Work With Abilene, TX’s Top Social Media Consultant

As a business owner, you probably feel like you’re too busy to invest your valuable time in learning how to measure social media ROI. If you need a social media professional to help you stand out from the competition, call Christina Davis Consulting in Abilene, TX, at (325) 977-0958.

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