After a little bit of a delay, it’s finally time to jump into the final segment of this three part series (Part 1, Part 2) on determining the ROI of your social media campaign. We’re actually going to use some dollar signs today! So buckle up and put your analytical caps on cause things are about to get serious.
Before we go any further, some of the things I’m going to discuss in this article will require advanced knowledge of Google Analytics (GA) - specifically, you’ll need to know how to build and use Advanced Segments and Custom Reports.
In order to stay on topic and to avoid turning this article into a dissertation, I won’t go into exact details on how to collect every single data point, but I will link to helpful resources along the way. The first helpful resource is Google’s Conversion University. Their lessons cover everything from the very basics to some fairly advanced topics.
Macro goals and micro goals
Every website on the Internet has a purpose. Well, maybe not every website, but in most cases, there is an action that the site owner hopes visitors will complete. On an ecommerce, site this would be purchasing an item. On a blog, it might be getting visitors to click ads or affiliate links, and on a B2B site, it would likely be generating new leads through contact forms or phone calls.
These are what Avinash Kaushik would call macro goals. They’re the reason the site exists - usually to make money. But they’re not the only way to determine your website’s performance. There are smaller steps along the way to that macro goal. This is especially true of B2B websites where the sales cycle is longer and generating interest in a big purchase or contract can take some time.
Micro goals on your site might include watching a video, signing up for your newsletter or downloading a white paper.
It’s very important that you take some time to think about why your site exists. What do you ultimately hope to get out of your site? And once you’ve answered that, what are the smaller steps that would expect visitors to take leading up to that ultimate goal?
Got it? Good, set up the appropriate goals in Google Analytics and let’s move on.
What’s the value of a goal?
Answering this is going to take a little bit of business research. You may have already done some of this research as a part of other marketing campaigns and those same numbers can apply here.
You need to answer these three questions:
- What’s the average lifetime value of a client?
- What percentage of leads (your macro goal) convert to clients?
- What percentage of your micro goals convert to leads?
Armed with this information, you can calculate the value of your macro and micro goals. To keep things simple, let’s say your client lifetime value is $1000, 10% of your leads convert to clients and 5% of your micro goal competitions turn into leads. This means that each macro goal completion is worth $100 and each micro goal completion is worth $5.
These values aren’t perfect. Your conversion rates will fluctuate over time and the completion of a macro or micro goal doesn’t necessarily earn revenue for you business. But there’s a definitely value for your business in gaining new leads and likewise, there’s a smaller value in someone showing interest in your business through a micro conversion. By putting exact numbers to these values we can start to zero in on the ROI of your social media campaigns along with all your other marketing campaigns.
Google Analytics allows you to assign numeric values to your goals, so once you’ve completed your research, plug these numbers in and we’ll move on to reporting.
The flaws of goal reporting
There are few different standard goal reporting options available in Google Analytics, but to be honest, I’m not a huge fan of them. The basic reports are too limited and don’t give you the bigger picture.
The chart above tells me where goal completions are coming from, but doesn’t tell me anything else about those traffic sources. I can’t really make any well-informed decisions with this limited data. Custom Reports to the rescue!
Ahh, much better. Now I can see both my macro and my micro goal completions in one location along with some data on visit quality and visitor behavior, but it’s still not perfect.
Sidebar: You can find more information about building Custom Reports here. And if you’re interested in seeing exactly what metrics we use for Pronto’s end-to-end Custom Report, you can see the details here.
There’s an inherent flaw in all analytics tools (not just Google Analytics). Goal completions will often take place after several visits from several different sources. So which source gets attributed with the completion?
In Google Analytics, the answer is the last non-direct visit. For example, let’s say a visitor finds your site through Facebook. They’re interested but don’t have time to investigate deeply right now, so they leave. A few days later, they search for your company name in Google and come back to your site, but they’re still not quite ready to contact you. On their third visit, they type your URL directly into their browser, then submit a contact form. In this case, Google would get the goal completion and Facebook gets the short end of the stick.
It’s an imperfect system. What we really want to look at is how visitors arrive at your site at key moments during the conversion funnel.
Build your conversion roadmap
To do this, we’ll need to really dig into some data that isn’t available in the standard Google Analytics reports. This is where some experience with Advanced Segments and Custom Reports will come in handy. If you’re not very confident in your GA skills, I’d suggest you check out the lessons on these topics over at Conversion University. Then, browse through my article on the Search Engine People blog about some useful Advanced Segments.
Our goal here is to build a couple of charts like these with our old friend, Excel:
These charts show our basic traffic sources (Direct, Non-branded Search, Branded Search, Referral, Email Campaigns, and Social Media) across a few important steps in our site-wide conversion funnel (first visit, second visit, three or more visits, watching our video and completing a contact form).
Each of these steps shows a higher level of interest in our services. Depending on your business, your website and your marketing tactics, many of the sources and steps could be different for you company - spend some time thinking about what you’re looking for before you dig into your data.
The top chart shows exact numbers from within the reporting period while the bottom chart shows those numbers normalized on a scale to 100. Now we can really see what’s going on!
All of the data used here can be gathered through using Advanced Segments or Custom Reports or sometimes both of them together. I think the most difficult part of this is finding 3 or more visits. This can be done with the following Advanced Segment.
That Regular Expression matches all numbers from 3 to 99. You’ll need to determine how many visits indicates a high level of interest in your company. Three to four is likely a good number unless your website is a blog or ecommerce site that depends highly on loyal visitors.
With these charts in hand, we can see that social media plays a decent role in drawing new visits to our site and an even stronger role with visitors that watch our video. Ahh, the big picture is coming into focus!
This isn’t just a good social media marketing exercise, it’s great for your entire Internet marketing strategy. Word of mouth and brand strength play a major role in our marketing success and that’s evident through the direct and branded organic visits that dominate the chart. But we can also see that non-branded organic and social media play an important role in spreading brand awareness and our email campaigns are huge in bringing visitors back to our site after that initial touch.
We’ve only recently started to ramp up our marketing efforts so it will be interesting to see how these change over the next several months.
An assist from Google Analytics
With the update to Google Analytics Version 5, Google started to provide some data that can give you an idea of the path your visitors take on their way to converting. The Multi-Channel Funnels section will tell you how long it takes visitors to convert, which paths they use the most often and which sources have the most assists.
I particularly enjoy the Assisted Conversion and Top Conversion Paths reports which can give you some great insight on how your top-funnel traffic sources (like social media) lead to conversions later down the road.
Putting it all together
We still haven’t defined the perfect report for determining the ROI of your social media campaigns. That’s because there isn’t one. Google Analytics is only giving you half the story. It doesn’t measure the influence of engagement on the social network themselves. But using everything discussed here and in Parts 1 and 2 of this series, we can gather all our knowledge and research and make a compelling argument for the effectiveness of social media.
Let’s say your team is planning the marketing budget going forward. The online advertising guy always has these great stats prepared and always gets a larger chunk of the budget than the social media team. With goal values and some GA research, you can bring some awesome metrics to the fight and put together something like this:
Last quarter, social media was responsible for drawing in X direct leads and assisted with an additional Y leads bringing $Z to the company. On top this, visitors from social media completed A [micro goals] on our site worth an estimated $B to the company. Social media plays an essential role in spreading brand awareness as indicated by our increased amplification rate (see Part 1) and a large percentage of new visitors to the site.
If that doesn’t convince your boss that your social media efforts have an impact on the success of your company, I don’t know what will.
Unclear how to collect some of this data? Leave a comment and I’ll be happy to provide more detail.
SEO & Social Media Manager