Measure the Numbers that Matter
Social media is one of the most powerful tools in a marketer’s tool belt. You can reach more people, engage them, and drive them towards your content than you can with any other advertising method. However, the effects of social media can be a bit more difficult to judge. You need to browse through data analytics and find a way to visualize the heaps of data at your disposal. To get a complete view of how social media is affecting your customers, you should measure these numbers:
The bottom line in any business will always be how much money you’re making. How many sales are you making? Now track those sales in comparison to different social media campaigns you’ve run. You may notice a trend – certain campaigns bring your total number of sales up, while others may have no visible impact. This helps you figure out which type of campaigns to invest your time in, and which to ignore.
Orders and Transactions
It’s not enough to track your sales dollars – you need to track the total number of orders that come in through social media. While sales will tell you the overall worth of your campaign, the number of orders helps you quantify it. This is particularly important if you’re using social media to announce discounts. For example, by tracking orders and sales, you’ll be able to find out if a discount is really worth it from a business perspective. If it doesn’t lead to a substantial increase in the number of orders, it probably wasn’t that effective.
Average Order and Transaction
A handful of big spending customers can throw all of your predictions out of whack. You need to look at what the average order is – how much is the average customer spending? This is one number you should be trying to improve. Social media may draw them to your website, but you want to find a way to increase the average order – that way you won’t be relying on those big spenders.
There are three different numbers you have to measure when you think about customer quantity: customer acquisition, retention, and attrition. Acquisition shows how many customers or followers you’ve gained on various social media platforms. Retention shows how many customers or followers are willingly staying with you – if you run a discount to your Twitter followers, how many of them continue to follow even after the discount has ended? Lastly, attrition shows how many customers you’re losing each month. Obviously, you want to keep your customer acquisition ahead of your customer attrition.
How much money are you spending in order to keep your social media campaigns running? You want to find the balancing point – the point where social media is cheap enough to make it worthwhile, but still brings in customers. When calculating costs, remember to include the amount of time it takes to run social media campaigns, even if the website itself is free, such as Twitter.
When all is said and done, profitability is what really matters. Are you making more money than you’re losing? When you run a promotion on social media, in the short-term are you making money or earning more customers? What about in the long-term?
Use the above metrics as a guideline, and you can insure that your bottom line stays in the black.