How to EQUATE ROI on Social Media
Social Media advertising has great ROI, return for investment, and it is smart business practice to see specifically how and where it is working for you. To understand the equation, you must first perform the groundwork, so I will share with you from top-to-bottom this process. Once done, this will become an automated system for you.
To find your ROI, Return on Investment, you must first know where you are going. This forward thinking is a crucial step and cannot be missed. Building sales and equating ROI is like building a shed and deciding if the shed is producing value and can be used in other ways. To build the shed you must ask yourself why (the goal), and then you need your measurements and the tools and the data to equate the feasibility.
Strategy and forecast must be on your mind from the beginning steps.
I have also made it simple for you in an interactive sheet that you can download free from our website at www.bfpvideos.com.
RAW EQUATION EXPLAINED
Revenue from Social Media – Cost of Social Media Activity
Cost of Social Media Activity
ANALYTICS AND SALES DATA COLLECTED/MONTH
10 VIDEOS = 1000 CLICKS
1000 CLICKS = 500 LEADS
500 LEADS = 100 PURCHASES
TRAFFIC TO LEAD CONVERSION RATIO – Useful statistical information to have
500 = LEADS
1000 = 50% = CLICKS
LEAD TO SALES CONVERSION RATIO - Useful statistical information to have
100 = PURCHASES
500 = 20% = LEADS
ROI EQUATION IN PRACTICE
NUMBER OF PURCHASES = 100
REVENUE PER PURCHASE = $100 (each of your product is $100 in this instance)
COST OF SOCIAL MEDIA = $500 (is what you spent in this campaign, not including cost of video in this instance because video is a one-time cost)
# of Purchases x Cost of Purchase = Revenue from Social Media
100 X $100 = 10,000
Revenue from Social Media – Cost of Social Media
Cost of Social Media
$10,000 – $500
= 19% OR 19.1 = EVERY $1.00 SPENT HAS GENERATED $19.00 IN SALES
Your ROI equation
To get a free download of an interactive spreadsheet to plug in your own figures, visit our main page on the website.
Professional Video is the #1 communicator today because it delivers efficiently and on an emotional level, addressing the needs of your target audience so they will engage with you further.
Your message -> delivered how your target wants to receive it = conversion for your business.
BFPVideos are experts on Video Marketing and Video Production.
I hope this has helped.
If you have any questions or would like a free consult, I would be happy to assist.
All the best to you and your business