How to prove and improve social media ROI

Your guide to driving true business value through social media marketing
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Table of Contents

Looking to boost your social media ROI? This guide has everything you need. 

Social media has become an integral part of marketing strategies, understanding and optimising Social Media ROI (Return on Investment) is crucial for businesses looking to thrive in the online landscape. As companies allocate more resources towards their social media presence, it’s imperative to not only track the effectiveness of these efforts but also to continually enhance them for maximum returns. 

In this comprehensive guide, we’ll delve into what social media ROI entails, why it matters, how to measure it effectively, and strategies to improve it. Additionally, we’ll explore tools that can simplify the tracking and enhancement process, ultimately helping businesses achieve their goals.

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What is social media ROI?

Social Media ROI refers to the return on investment a company gains from its social media activities. It measures the effectiveness of social media campaigns in generating revenue or achieving predefined objectives. This could include metrics such as lead generation, website traffic, brand awareness, customer engagement, or direct sales.

Why does tracking your social media ROI matter?

Tracking social media ROI is essential for several reasons:

  • Resource allocation: It helps businesses understand which social media channels and campaigns are yielding the best results, allowing them to allocate resources effectively.
  • Performance evaluation: By measuring ROI, companies can evaluate the success of their social media strategies and identify areas for improvement.
  • Demonstrating value: Demonstrating a positive ROI validates the importance of social media marketing to stakeholders and justifies continued investment in these channels.

Mistakes to avoid when measuring social media ROI

When measuring social media ROI, avoid these common mistakes:

  • Focusing solely on vanity metrics: Metrics such as likes, shares, and followers provide insights into engagement but may not directly correlate with ROI. Instead, prioritise metrics that align with your business objectives.
  • Neglecting attribution: Failure to accurately attribute conversions to social media efforts can lead to inaccurate ROI calculations. Utilise tracking links and analytics tools to attribute conversions properly.
  • Ignoring Customer Lifetime Value (CLV): Social media efforts may contribute to long-term customer relationships and repeat purchases. Consider CLV when calculating ROI to capture the full impact of social media marketing.

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What is a good ROI for social media?

The ideal ROI varies depending on factors such as industry, business goals, and campaign objectives. However, a positive ROI indicates that the benefits outweigh the costs of social media marketing efforts. Aim for a return that exceeds the resources invested to ensure profitability and sustainability.

How to calculate and track your social media ROI?

To calculate and track social media ROI effectively, follow these steps:

  • Define objectives: Clearly define your goals, whether it’s increasing sales, driving website traffic, or boosting brand awareness.
  • Set Key Performance Indicators (KPIs): Identify metrics that align with your objectives, such as conversion rate, click-through rate, or cost per acquisition.
  • Track expenses: Calculate the costs associated with social media campaigns, including advertising spend, content creation, and platform fees.
  • Measure results: Utilise analytics tools like Google Analytics, social media insights, and tracking links to measure the performance of your campaigns.
  • Calculate ROI: Subtract the total costs from the revenue generated by social media activities, then divide by the total costs and multiply by 100 to get the ROI percentage.

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How to improve your social media ROI

Once you know how to track and prove your social media ROI, we’re sure you’re then going to want to improve it, no matter how well you’re doing. These tips will have you well on your way to driving even more business value. 

#1 Build detailed customer personas and target audience

Understanding your audience is foundational to effective social media marketing. Building detailed customer personas involves researching and analysing your target demographic’s preferences, behaviours, and pain points. This includes demographics such as age, gender, location, as well as psychographics like interests, values, and challenges they face. By gaining insights into your audience, you can tailor your content and campaigns to resonate with their needs and interests, increasing engagement and ultimately driving conversions.

How to implement:

  • Conduct market research: Utilise surveys, interviews, and social media analytics to gather data about your audience.
  • Create customer personas: Develop detailed profiles that represent different segments of your target audience, incorporating demographics, interests, motivations, and challenges.
  • Personalise content: Use audience insights to create content that speaks directly to their interests, concerns, and aspirations.
  • Test and iterate: Continuously refine your personas based on feedback and evolving market trends to ensure relevance and effectiveness.

#2 Optimise social commerce and mobile checkout experiences

With the rise of social commerce, optimising the purchasing process on social media platforms is essential for maximising conversions. Mobile commerce is particularly significant as more users engage with social media on mobile devices. Streamlining the checkout experience reduces friction and removes barriers to purchase, improving the likelihood of conversion.

How to implement:

  • Mobile-friendly design: Ensure your website and checkout process are optimised for mobile devices, with responsive design and fast load times.
  • Simplify checkout steps: Minimise the number of steps required to complete a purchase, reducing the likelihood of cart abandonment.
  • Enable social commerce features: Take advantage of built-in shopping features on social media platforms, such as Instagram Shopping and Facebook Marketplace, to facilitate seamless transactions.
  • Offer multiple payment options: Provide a variety of payment methods to accommodate different customer preferences and increase convenience.

#3 Make full use of platform-specific functionalities

Each social media platform offers unique features and tools that can enhance the shopping experience for your audience. Leveraging these functionalities allows you to provide a seamless and immersive shopping experience tailored to each platform’s user base.

How to implement:

  • Instagram Shopping: Tag products in your posts and stories, allowing users to purchase directly within the app.
  • TikTok Shop: Utilise TikTok’s in-app shopping features, such as product links and shoppable livestreams, to showcase products and drive conversions.
  • Facebook Marketplace: List products for sale in Facebook Marketplace, reaching users who are actively looking to buy and sell goods.
  • Pinterest Buyable Pins: Enable Buyable Pins on Pinterest to make it easy for users to purchase products they discover on the platform.

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#4 Collaborate with creators in an always-on capacity

Influencer marketing continues to be a powerful strategy for driving engagement and conversions on social media. Partnering with creators allows you to leverage their influence and credibility to reach your target audience authentically.

How to implement:

  • Identify relevant creators: Find influencers whose audience aligns with your target demographic and brand values.
  • Establish long-term partnerships: Build ongoing relationships with creators to maintain consistency and authenticity in your campaigns.
  • Provide creative freedom: Trust creators to develop content that resonates with their audience while staying true to your brand messaging.
  • Track performance: Monitor the effectiveness of influencer collaborations using metrics such as engagement, reach, and conversion rates.

#5 Lean into the latest social media platform features

Staying updated on platform updates and trends allows you to adapt your social media strategy to capitalise on new opportunities and maximise reach. Social media platforms are constantly evolving, introducing new features and functionalities that can enhance your marketing efforts.

How to implement:

  • Stay informed: Follow industry news and updates from social media platforms to stay ahead of emerging trends.
  • Experiment with new features: Test new features and functionalities as they become available to understand their potential impact on your audience.
  • Monitor performance: Track the performance of your campaigns using platform analytics to assess the effectiveness of new features.

#6 Use social media ads to drive direct conversions

While organic reach is valuable, investing in targeted advertising campaigns can amplify your message and drive immediate action from your audience. Social media ads offer precise targeting options and measurable results, making them a valuable tool for driving conversions.

How to implement:

  • Set clear objectives: Define specific goals for your advertising campaigns, whether it’s increasing sales, generating leads, or driving website traffic.
  • Target audience segmentation: Utilise advanced targeting options to reach your ideal audience based on demographics, interests, and behaviours.
  • Create compelling ad creative: Develop visually appealing and persuasive ad creative that grabs attention and encourages action.
  • Monitor and optimise: Continuously monitor the performance of your ads and make adjustments based on real-time data to optimise results.

#7 Regularly assess your competition’s activity and performance

Monitoring your competitors’ social media strategies provides valuable insights into industry trends, audience preferences, and potential opportunities. By staying informed about competitor activity, you can identify gaps in the market and make informed decisions to stay ahead of the competition.

How to implement:

  • Competitor analysis: Identify key competitors in your industry and analyse their social media presence, content strategy, and engagement levels.
  • Benchmark Performance: Compare your own social media performance metrics to those of your competitors to gauge your relative performance.
  • Identify opportunities: Identify areas where competitors are succeeding and areas where they may be falling short, and use this information to inform your own strategy.
  • Stay agile: Continuously adapt your social media strategy based on changing market dynamics and competitor activity to maintain a competitive edge.

By implementing these strategies, businesses can enhance their social media ROI and achieve greater success in their digital marketing efforts. From understanding the audience and optimising the purchasing process to leveraging influencer partnerships and staying ahead of industry trends, each strategy plays a crucial role in driving measurable results.

Tools for tracking your social media ROI

It will probably come as no surprise to you that there are tools out there that can help you in the process of proving your social media ROI. Here are the top three you can’t miss. 

Google Analytics

Google Analytics is a powerful web analytics tool that provides valuable insights into website traffic, conversions, and user behaviour. By integrating Google Analytics with your social media platforms, you can track the effectiveness of your social media campaigns in driving traffic to your website and converting visitors into customers.

How to utilise:

  • Track campaign performance: Use UTM parameters to tag your social media links, allowing you to monitor the performance of specific campaigns and channels within Google Analytics.
  • Measure conversions: Set up goals and conversion tracking in Google Analytics to track actions taken by users on your website, such as purchases, sign-ups, or downloads, originating from social media.
  • Analyse user behaviour: Gain insights into user behaviour on your website, including page views, session duration, and bounce rate, to understand how social media traffic interacts with your site.


Tracking links

Tracking links, also known as URL tracking or campaign tracking links, are customised URLs that include tracking parameters (UTM parameters) to identify the source of traffic and attribute conversions accurately. By using tracking links in your social media posts and campaigns, you can track the performance of each link and gain insights into which channels and campaigns are driving the most engagement and conversions.

How to utilise:

  • Create customised URLs: Use tools like Google’s Campaign URL Builder to generate tracking links with UTM parameters that specify the source, medium, campaign, and other relevant information.
  • Track clicks and conversions: Monitor the performance of your tracking links in analytics platforms like Google Analytics or social media advertising dashboards to track clicks, conversions, and other key metrics.
  • Optimise campaigns: Analyse the data from tracking links to identify top-performing channels, campaigns, and content types, and optimise your social media strategy accordingly.


Social listening tools

Social listening tools allow you to monitor conversations, mentions, and sentiment surrounding your brand on social media platforms. By listening to what people are saying about your brand and industry, you can gain valuable insights into customer perceptions, emerging trends, and areas for improvement, helping you make informed decisions and adjust your social media strategy to better align with your audience’s needs and preferences.

How to utilise:

  • Monitor brand mentions: Track mentions of your brand name, product names, and relevant keywords across social media platforms to stay informed about conversations happening around your brand.
  • Identify trends and topics: Monitor trending topics and hashtags related to your industry to identify opportunities for content creation and engagement.
  • Engage with your audience: Respond to comments, questions, and feedback from your audience in real-time to foster engagement and build positive relationships with your customers.
  • Track sentiment: Analyse the sentiment of conversations surrounding your brand to gauge customer satisfaction and identify areas for improvement in your products or services.


By leveraging these tools effectively, businesses can gain deeper insights into the performance of their social media efforts, identify opportunities for optimization, and ultimately improve their social media ROI.

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Whether it’s tracking website traffic and conversions with Google Analytics, attributing conversions accurately with tracking links, or monitoring brand sentiment and engagement with social listening tools, each tool plays a crucial role in optimising social media campaigns and driving measurable results.

Understanding and optimising social media ROI is paramount for businesses striving for success in today’s competitive landscape. By avoiding common pitfalls, setting clear objectives, leveraging data-driven insights, and employing effective strategies and tools, companies can maximise their returns from social media investments.

To simplify the process and streamline collaboration with creators, consider leveraging the Vamp platform. As official partners of leading social media platforms, Vamp provides comprehensive solutions for sourcing, briefing, and reporting on influencer campaigns, ultimately saving time and effort while driving measurable results. Get started with Vamp today to elevate your social media ROI and achieve your business objectives.

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