Social Media ROI: Get the Most Bang for Your Buck.

As organic reach becomes increasingly difficult to obtain on social, more brands are turning to paid ads to connect with their audience. Here's how to spend wisely.
Helle Tyllesen
May 6, 2020 - 4 min. read

In a world driven by metrics, every marketer is expected to be able to show how their budget is being spent. And as businesses pivot to meet shifting market expectations and opportunities, everyone is expected to be able to demonstrate the return on their investments.

In the past, social media managers were able to produce a number of statistics intended to justify their efforts. Follower count, likes, and retweets were all seen as proof of brand awareness, believed by some to be an acceptable return on marketing investment. After all, the only outlay was on salary for a social media manager.

But the commercialization of social media has forced companies to re-evaluate their approach and expectations.

The social landscape has changed

Floating on the stock market forces businesses to change the way they do things. In the case of Facebook and Twitter, this meant finding ways to generate a profit to appease their shareholders.

And armed with valuable data about their users’ preferences and interests, this quickly led to the development of paid advertising platforms. Suddenly, social media managers in charge of running campaigns for brands faced a problem.

Most noticeable was the drop in organic visibility. The use of new algorithms on Facebook meant that even a brand’s fans would not see every post from that business in the future.

social media ROI


According to Bonsey Jaden’s case study on organic Facebook reach in APAC, there has been a steady decline on Facebook over the years – dropping from an average of 5.4% per post down to 1.2% in 2018. 

In 2017, there was a 20% drop in organic reach and engagements observed by brands and publishers on Facebook. The following year, CEO Mark Zuckerberg announced that Facebook would further reduce the reach of branded content published on Facebook pages. 

This means to enjoy the same results as they once did, brands will have to spend more on their paid advertising. The senior management of any organization would want to know how that money is spent and what (if any) social media ROI is being realized. 

So how do you prove social media ROI when running an ad campaign?

1. Set your metrics in advance

First, forego the vanity metrics. Follower count and page likes can give you signals about the health of your online community and are great for measuring the top of the funnel success but have a negligible effect on proving ROI.

Instead, base your metrics on actual user interaction with your ads – number of app downloads, number of completed sign-up forms, and number of products purchased. These are the figures that actually mean something in terms of revenue for your business.

2. Be more selective:

Marketers shouldn’t eenymeenyminymoe the content they choose to promote on social. You should be more selective and invest in posts that have high potential to drive as many interactions as possible.  

This is where you need to rely on smart social media platforms, like Falcon, to help keep track of your performance and make informed decisions about what to post and where to put some money behind your efforts to drive results. 

3. Ask for input

The insights gained from social media extend far beyond the marketing department. Information on customer experience, support provisions, and product quality can all be gleaned from social media if you set out to look for it.

Social media does not exist in a bubble, so you should always ask for input from other departments about the metrics they would like to see collected and reported on. The results of such analysis can be hard to quantify, but if the insights help boost efficiency or cut costs, your social media ROI naturally increases.

4. Prioritize flexibility

If your business hopes to use social media insights to become more flexible and responsive, your collection and analysis routines will have to be similarly elastic. A flexible approach to social media ad buying will also allow you to refine campaigns as they are being executed to avoid wasted spend.

To achieve the biggest bang for your buck, you need to be flexible and learn to adjust how and where ad budget is allocated effectively. 


5. Use technology effectively

Each of the major social platforms has a selection of tools to help marketers maximize the value of their ad spend. But when executing a comprehensive, multi-platform campaign, your business needs a platform capable of centralizing operations to help simplify management and provide a complete overview of performance.

Without this high-level view, you will be unable to assess social media ROI until the campaign has been completed, the PPC budget is spent, and all statistics are collected and collated from each separate ad tool. A platform like ours here at Falcon gives you the big-picture data you need to prove social media ROI for your entire program, not just a facet of it. And using that information allows you to make informed decisions for a maximum return on ad spend.

Calculating social media ROI is not a dark art

Effective ad spend is notoriously difficult to master, particularly without real-time analytics to assess performance. Few businesses will waste $600,000 on ineffective social media marketing, like how this one small business had a budget of more than $600,000 for Facebook ad campaigns back in 2014, but many will be unable to demonstrate any kind of ROI for their efforts.

However, social media ROI is more than simply keeping the bosses happy about budget spend. Measuring and acting upon social media ROI information can be applied immediately in a way that less organized and less statistical competitors cannot.

Managed properly, social media ROI can be your business’ secret competitive advantage in the online marketplace.

Want to learn more? Check out our free Social Media ROI handbook available for download below: