In my previous post about social media ROI, I argued that we should not, in fact be reporting ROI to the business big-wigs. Hey, if you post a social media link and you track that to show that you’ve made $2 million for the company (Dell) then all power to you! Woot! to you.

For many businesses, however, it’s not that cut and dry.

Measure Key Performance Indicators

Previously, on The Social Media Butterfly, I presented the idea that perhaps social media is a part of a larger marketing initiative that doesn’t necessarily have a dollar sign appointed to it. Sometimes, eyeballs on a brand – or brand awareness – is the larger goal. I’m sure you’ve all heard of a sales funnel – and social media is one step down that funnel. So at the end, there are sales, but they may or may not be directly traceable to a Twitter post, or a YouTube video, for example.

So, I think we should be reporting on KPI – key performance indicators. Sure, we all want to show the execs that the projects we’re working on are valuable – otherwise, our jobs won’t be so secure. However, I think determining an ROI on every social media campaign – heck, every MARKETING campaign, isn’t a fair assessment.

If we look at KPIs, we can better measure the performance of a social media endeavor. How many ReTweets did you get on Twitter? How many Facebook “likes”? How many times did someone comment on a post, or in a forum? How many times was a person with a problem helped in a responsive and timely way? Did that person walk away feeling like they’d just built a relationship? Or will that person now go and bad-mouth your crappy customer service to their friends? (Sentiment.)

KPIs aren’t so cut and dry either. I’ve mentioned this before (What’s the value of a fan?) but if you measure yourself against how many Facebook “likes” you have, that’s a measurement that’s easily skewed to your advantage. Give something away for free, anything, and your “likes” sky rocket. But THEN WHAT? Is that relationship of value to you? Does the person care about your product, or just about the freebie?

So then, what’s the value of a fan/friend/share/like/tweet? If you give me a million dollars, then I’ll tell you. Just kidding! If it was that easy, you wouldn’t HAVE to give me any money.

It depends on the business goals. But I do think, if you set those business goals, you can perform to them. It’s the same as having a performance review at work. If your goal from last year is to “increase sales” – and you’re up by 1 this year, well, you met the goal, right? But is it a good review?

If your goal is “great customer service” – you can measure that by response time to complaints, overall speed to solution, customer sentiment, etc.

What I’m saying here is that just because social media is the latest marketing buzz phrase, and businesses are scared you-know-what-less to jump in, doesn’t mean that we should hold the medium to some kind of ridiculous standard that we don’t hold to other marketing forms.

You’ve got to determine what performance means to your company, to your line of business. If it’s “sales” – does that mean on-the-spot sales or 3-months-from-now sales. Measure against your priorities, and you’ll see that social media can be measured, and can be a successful part of an overall strategy.