Key Performance Indicators for Social Media Marketing

Key Performance Indicators for Social Media Marketing

Key Performance Indicators (KPIs) are a measure of performance management used by different organizations to evaluate the success or failure of a particular product, marketing campaign or activity in which the company is involved. The list of KPIs differ from industry to industry and also from one company to another within the same industry. The choice of KPIs depends to a large extent on the goals that you as a company are aiming to achieve through a particular activity or marketing campaign.

Social media has revolutionized the way we communicate as a society at a personal level and also for interactions between companies or between the company and customers. Most companies today use social media to market their products and services and to communicate with customers to learn more about their preferences about the company’s products. This ability to reach out to customers at a personal level has made social media campaigns an integral part of every company’s operations, which means most companies are formulating different KPIs to evaluate the success of their social media marketing campaigns.

So in order to get the best evaluation of your social media marketing campaigns, it’s important for you to make a list of KPIs that meet your idea of success. The most common KPIs for social media are brand awareness, engagement with customers at a personal level, increasing the traffic to the website, tracking competition, refining products and services to match the customers’ needs, reaching out to more and more customers and improving the profitability of the company.

Brand Awareness

Social media is the best avenue to work on your brand awareness. If this is one of your goals, then you should strive to create and maintain a positive image of your company among your followers on social media. To achieve this positive image, you have to ensure that every statement that is written and every attitude that is exhibited shows your company in a good light. To measure brand awareness, you should use the following KPIs:

Duration of activity by customers
A measure of brand awareness is the duration of time spent by a customer on your social media page. It is the time between the first reaction of a customer and the last reaction of the customer within the same year. This will give you a fair idea of the interest shown by the customer towards your company and its products and services. With this, you can differentiate between a loyal, potential customer and someone who leaves your page after 15 seconds.

Degree of Involvement
Another KPI is the degree of involvement with the customer, whether he or she is actively communicating with you or not. One mistake that most people make is to count the number of fans or likes on the page. This is not an effective measure of involvement because this number can rise or fall depending on your promotional abilities. For example, if you advertise a promotion to give away a free laptop, then the number of likes will most likely increase. However, it doesn’t really tell you that these people actually “know your brand”, but they merely liked your page just to win something.

Hence, it’s probably better to count the number of comments or shares as these show a higher degree of involvement and a more sincere interest in the brand/company.

Interaction with Customers

It is important to interact with your fans and followers to understand their demographics better. When you understand what your customers think about your product, and the improvements or changes they would like to see in your product, it will help you to better design and customize your products to meet their expectations. To measure the level of interaction, the following KPIs are used:

Time spent 
It is a good idea to hire a community manager who will spend the entire day responding to fans and followers. This is important to ensure that the communication flows between your company and customers and also, through this conversation, you can find more about the customers’ preferences and needs. The amount of time that a community manager spends on your page will determine the ability of your company to understand the preferences of your customers.

Amount of information
Interactions with your fans will improve when you offer more information about your product or when you talk about related tips or suggestions. The amount of information you provide will also determine the level of interaction, and this makes it another KPI for identifying your level of interaction with customers.

Improving Profitability

Many businesses are for-profit organizations, so the ultimate aim of the business operations is to increase revenue and the profitability of the company. You can use different metrics to measure your company’s success in terms of its profitability. Some of the indices you can use to measure the profitability are discussed below.

ROI
The return on investment (ROI) is a key measure to identify the success of your social media campaign. ROI is computed as the amount of money gained from the campaign minus the cost of the campaign, divided by the cost of the campaign. The value is usually expressed in percentages and  if it’s positive, then it means the company has increased its profitability while a negative value signifies loss – and it also means the campaign was unsuccessful.

Gross profit
Another key measure of profitability is to calculate the gross profit of the company from the beginning of the social media campaign to its end as this will help you to determine the success of your strategies. If you can identify the revenue per lead or per campaign, then it will give you a better performance measure of your social media marketing efforts.

Web traffic analytics
Web traffic analytics give you a better idea of how many visitors have come to your site and the actions they perform while they are there. My personal favourite is Google Analytics but there’s a large number of them out there for you to explore and find one that suits you best. Using these web analytics and reporting tools help you to measure the success of social media campaign almost in real-time, so you’ll be able to make changes very quickly to further facilitate its success or prevent its demise.

Conversion rate
The conversion rate is the ratio of visitors who get converted from casual visitors to those who perform the actions you desire, such as buying a product.  There are a few ways that you can improve your conversion rate namely, through search engine optimization, making more attractive landing pages and simplifying your website’s user interface. With this, you’ll easily be able to determine roughly how well your campaign performed using these conversion rates, and improve on them with a better social marketing strategy.

In short, social media marketing has become a vital arm of every company’s marketing activities. The success of a social media campaign is determined by the goals of the user and these goals can be measured using different KPIs. The exact list of KPIs depend on your company’s goals and the industry in which you operate.