Social media ROI

Social media ROI is the return generated by social activity divided by what that activity cost, including the hours. It is the metric everyone asks for and almost nobody can compute cleanly, because social's effects are spread across channels and time.

The honest difficulty is attribution: someone sees your posts for a year, then Googles you and buys, and analytics credit the search engine. Post-purchase surveys ("how did you hear about us") regularly attribute several times more to social than click-tracking does, and neither number is the whole truth.

Practical approaches, in increasing rigor: track what is trackable (tagged links, promo codes, DMs that become sales), survey at signup or purchase, and for the brave, run holdout experiments by region or period. The Duolingo case on our site is a rare natural experiment: they toned their social down and told shareholders growth had slowed.

The cost side is easier and often skipped: tools plus ad spend plus loaded hours. A channel that "costs nothing" but eats twenty hours a week has a very real denominator.

Related terms: Dark social · CPM (cost per mille) · Engagement rate