Platforms such as Facebook, Twitter and the recently launched Google+ for business have become a powerful tool for marketing professionals interested in creating conversations around brands, products or companies. However, many business owners who try to use any of these platforms find it difficult to ascertain what is the value of Social Media on marketing and promotion when compared with other more traditional forms of advertising such as paid advertising or SEO.

Social Media ROI AND Influence on Sales

Social Media marketing ROI is a difficult thing to calculate. Unless you are willing to pay for very expensive traffic monitoring tools and customer surveys is considerably difficult to figure out if a Social Media campaign directly resulted on a sale. However, there’s little doubt that if people sees a company actively interacting on Twitter and has good feelings about that particular product, they are more likely to choose it over an equivalent competitor. However, calculating ROI is still a big part of choosing whether particular ideas to make money have a chance to succeed, which means Social Media marketing is, understandably, often overlooked by small businesses and entrepreneurs.

To calculate Social Media ROI, and its value on marketing and promotion, you’ll need to establish clear Social Media specific goals, and be able to track your campaign performance against them.


Some of the most common goals of Social Media are increasing positive feelings about a brand, and reaching new audiences through your follower’s networks. For example, you could estimate how many new people will know about your business when somebody Likes you on Facebook, or how many Twitter users read your post after somebody retweets your link. Compare that with the amount of money you’d need to spend on PPC advertising to reach the same amount of people and you’ll have your Social Media estimated ROI.

Examining changes on the sentiment around your brand caused by Social Media can also be a helpful measure of the value of social media. Consider looking at the number of positive and negative mentions, and see how much time you spend answering angry or unhappy customers. Often when the sentiment around a brand is positive your own fans will come to the rescue and create knowledge basis, answer questions on forums and social media venues and even be your best defenders when somebody else is complaining.

Social Media Costs

It is important to also consider social media costs when calculating its value as a marketing tool. Social Media is often suggested as a great strategy to market easy home based business ideas, as it doesn’t require the purchase of expensive tools or any upfront investment to buy advertisement space. It’s also, unlike SEO, quite immediate and can give quick results at times such as launch time, when your goal is to get new customers as soon as possible.

However, Social Media for small businesses is not free. To start with, it’s highly likely that at some point you’ll need to use some social media marketing tools to optimize your social media strategy. If you opt to do it all manually you’ll still be spending an entirely different currency: Your time. And time is something entrepreneurs often find in small supply, so if your Social Media strategy is too demanding you may find you spend too much time managing it and too little actually producing money.