Social Media Metrics Made Simple: Focus on Sales and Customers


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I am amazed that so many people spend so much time defining and discussing social media metrics. Why? Because the answers marketers (and shareholders) want are very, very simple. Marketers want only one thing from marketing budget investment. Marketers want sales – sales are key; almost everything else is a proxy for some point on the journey to the sale. Make no mistake, companies and marketers are working to deliver sales. Sales are the elixir of life for commerce. Sales drive economies of scale and increase profitability. Sales are the business. In fact, sales are business. Period. And despite this, the ever expanding list of social media metrics contain virtually no hard commercial measures. Here is a list of 30 popular social media metrics I am aware of as of today:

  1. Active network size
  2. Amplification rate
  3. Applause rate
  5. Channel views
  7. Downloads / Installs
  8. Email subscribes
  9. Engagement
  10. Fans
  11. Favourites
  12. Feed subscribes (RSS)
  14. Following
  15. Forwards
  16. “Influence”
  17. Klout score
  19. Lists
  20. Mentions
  21. Reactions
  22. Re-Tweets
  23. Sentiment
  25. Subscribes
  26. Tags
  27. Tweets
  28. Tweet Reach
  29. Tweet Velocity ( I like this one!)
  30. Wall posts

There is a big problem here. Most of these metrics have little or no commercial meaning. What for example is the value of a “Like”? A like is no more than a mouse click on a web page. It requires no effort and takes a fraction of a second to perform. A like requires no trade in information between the user and the item being liked. Anyone can do it and it signifies virtually nothing. Even the popular ’email address for download’ exchange has limited value; I have downloaded a number of papers from companies it’s unlikely I’ll ever do business with – even though I am sufficiently interested in the content being provided to exchange my email address for it.

It’s ironic that whilst social media commentators and practitioners are busy churning out metrics with no real commercial meaning, traditional media is moving away from proxy data like coverage and frequency and into measuring and proving commercial behavioural change (fancy talk for sales) resulting from media activity. It seems to me that social media evaluation has slipped into reverse gear and no none has noticed. If social media is to advance its cause it needs to show either a direct or indirect link to more commercial measures like sales and customers. Is that possible? Well yes it is and it’s relatively straightforward.

All communication and media channels including digital media feed into sales funnels. Digital media traffic is the most measurable of these and can be tracked and measured in great detail from clicks to basket values. This means it is possible to measure the commercial value of traffic generated by social media. If your Facebook page is generating traffic you can identify it in your inbound traffic logs. And if you can track the traffic through to sales baskets you can measure the sales generated by Facebook. And then you can start looking at your social media ROI numbers. If your Facebook page is referring 1,000 sales a month with a profit of £10 per sale, and costing only £1000 per month to manage and maintain, it’s making a valuable contribution to your business. If other hand it is producing 100 sales per month with £10 profit per sale and costs £10,000 per month to manage and maintain, then you are throwing money away.

The truth is that many social media variables only exist because of a strong supply side data push. Social media metrics are easy to produce; be they likes, friends, tweets, connections or channel subscribers they’re just descriptive data. At worst these metrics are a distraction for marketers. At best they are a rough proxy that needs to be calibrated with more meaningful commercial data. What marketers and business leaders want is sales, share, customers, customer value and profit. If social media sticks with likes, friends and subscribers sooner or later it will have to show what they mean.

Republished with author's permission from original post.

Simon Foster
I am currently Head of Analytics for EMEA at m/SIX, an agency co-owned by The&Partnership and WPP. I work with advertisers to help them increase their marketing effectiveness across digital and traditional media channels using advanced evidence-based techniques.


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