What’s the ROI of social media? Dunno, what do you want it to be?


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I was catching up with a friend of mine the other day who works for an agency specialising in the B2B sector. He mentioned that he was potentially doing some work for an FMCG company who were interested in the social media space. The company wanted case studies and ROI. My friend asked if I could point him in the right direction.

My response was simply: Good luck!

However, I don’t think this is an atypical request and illustrates at the outset the distance that exists with regards to people’s understanding of the social media space and the reasons for using it.

Case studies are great and do give useful insights, but every company uses social media differently. Take just one platform for instance – Twitter. The way Dell uses it is different to the way Vodafone uses it, is different to the way TalkTalk, Virgin Trains or BT uses it. BestBuy’s Twelpforce is different again.

Likewise, what will asking for the ROI of Twitter show? Not very much actually. If truth be told, if you spoke to people who use Twitter to provide customer service, they would probably all agree that, whilst there is a cost savings element, the numbers simply don’t stack up. And therein lies the rub: how do you convince someone to give social media a go, if all they ask is – ‘show me the ROI?’

My thoughts on the matter are this. ROI is important, but you’ve got to know where to apply it. Just because you use Twitter in customer service, doesn’t actually mean ROI should be applied there. I know instances where marketing holds the social media budget, but it is actioned in customer services. Recognition that customer service has an important part to play in terms of brand reputation.

Deeper than this, however, is that looking for the ROI first, totally ignores the customer. Understand the customer and their motivations, see where they are and what they’re using, and you start to understand whether social media, whether that’s Twitter, Facebook, YouTube amongst others, has any relevance to them and in turn, you. And then start experimenting with these different platforms and see what, if any, relevance they have to you. But how do you account for social media experimentation in your P&L? BestBuy’s Twelpforce was an experiment.

I was talking with someone today who works in the social media customer service space over coffee about ROI and whether it was possible to come up with a social media ROI model. We decided between us that it should be £1.42.

By the way, what’s the ROI of not being there?

£1.42 perhaps… so there we have it. Sorted.

Republished with author's permission from original post.

Guy Stephens
Guy is a social customer care trainer/consultant who has been in the social customer care space since 2008. He is also the Co-founder of Snak Academy, which provides online social customer care microlearning for individuals and SMEs.


  1. Guy: great post. As an accounting professor recently shared with me, businesses favor transactions in which Value Received is greater than Value Given Up. That calculus invariably involves monetary amounts. The problem is that ROI is used–abused is a better word–because people throw out the term in a generic way, when it has a specific financial meaning. Wouldn’t we find it frustrating to talk with a CFO who continually asks how many leads our company has when he really means how many customers we have. We corrupt the meaning of ROI in the same way.

    A blog I recently wrote, ROI Hype: Finance for Fools? explains the conundrum. In an nutshell, ROI ignores time and risk, and too many social media proponents are too uncomfortable–or too unaware– to discuss those issues. Friction occurs because corporations vet projects using time and risk in the financial calculus. By definition, that’s not ROI. So they wind up making their own SWAG’s and assumptions. Often, those discussions don’t favor the adoption of many projects that embed social media.


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