How To Measure Social Media ROI For Small-Business Marketing

Pinterest, the booming image-based social media platform that recently garnered a 1,407 percent year-over-year rise in usership during 2012, recently unveiled a new analytics platform that helps businesses measure Pinterest-driven traffic.

In order to make use of the tools, businesses must first have a verified website. Upon registering a site, you’ll be able to access data on how many people pinned items from your site, how many saw those pins and how many visited your site from Pinterest. You’ll also be allowed to see your most popular, most clicked and most recent pins.

The recent Pinterest offering further demonstrates the highly technological evolution of social media, but also exposes a point lost on many entrepreneurs: measuring social media through analytics is supremely beneficial to your small-business marketing strategies.

Income.com knows entrepreneurs are knee-deep in social media as it is, but throwing time and resources at it without any idea of what you receive in return is holding many back from fully realizing their potential.

Measuring social media return on investment (ROI) is increasingly important for brands committed to their social media efforts, and there are a number of ways to do it that entrepreneurs need to be aware of.

Analytical Tools

Pinterest is more of a latecomer to the social media analytics party than anything – Facebook had previously launched its Insights offering, which similarly helps you measure your site activity and performance. Such tools enable you to view referral traffic and user demographics.

You can also measure Twitter performance through software like Twitalyzer, which measures your influence and reach by weighing unique mentions, frequency of retweets and number of followers, among other factors. TweetReach is a similar offering that calculates your Twitter exposure, though both come at a price.

Klout, while not tied to any specific platform, is another tool growing rapidly in popularity. By compiling and analyzing numerous social media indicators, Klout assigns a score on a 1-100 scale, which businesses can then use to fully understand their influence and direct their small-business marketing strategies toward capitalizing on what they do best in order to get results.

DIY ROI With KPIs

If entrepreneurs want to take matters into their own hands and measure their social media ROI through their own analytics, there’s a way to do that.

Finding the true value of your social media ROI lies in which key performance indicators (KPIs) you want to track and give the most weight to. For instance, marketers have developed an equation to calculate the value created by a Facebook like, also known as value of a like(VOAL). While determining the value of a specific like through VOAL may require some advanced number crunching and some first-grade recall to the order of operations rule PEMDAS, there are easier ways to calculate your influence and added value derived from social media activity.

Some of those strategies include calculating conversions, engagement rates, organic clicks, sponsored ad performance and small-business website traffic generated by your social account.

Income.com wants entrepreneurs to know that even though social media is an environment for casual and personable communication, there’s still some hard data below it all, waiting like a diamond in the rough. Using platform-specific analytics can help, and so can social media equations you calculate on your own. Either way, determining the value you derive from social media marketing is the most pressing action small businesses can take to ensure their future success.