ROI of Social Media for Your Online Business by Gilad Krein

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Gilad Krein Explains How to Measure Social Media’s ROI For Your Online Business

Gilad Krein

How to Measure Social Media’s R.O.I. For Your Online Business

Measuring your social media R.O.I. should be one of your highest priorities as a business owner or digital marketer. After all, if you invest time and resources into social media marketing, you need to know if it’s paying off!

Unfortunately, social media R.O.I. can be challenging to measure. Numerous factors must be considered, some of which are difficult to quantify.

Don’t worry; we’ll walk you through Gilad Krein’s process for calculating social media ROI in this article. 

Let’s start with the basics first!

What Is social media R.O.I., according to Gilad Krein

Social media R.O.I. measures how much value you’re getting from your social media presence (in terms of money and time).

You will generally see the below formula for defining and calculating social media R.O.I. on every other blog:

[ (Return – Investment made) / Investment Made] X 100 = Social Media ROI

Positive values indicate you made more than you invested on social media, while negative values indicate you lost money.

While it’s 100% correct, it might be tricky to understand.

In simplest terms, social media R.O.I. determines the profit or return you make through social media marketing activities.

Why Is It Crucial to Measure R.O.I. on Social Media

No matter how big or small your company is, you must be mindful of your marketing budget. And social media is no different – every penny spent on social media should give you positive returns.

But besides the economic importance, measuring your social media R.O.I. has the following benefits:

  • This tool can help determine if you’re on track to achieve your goals.
  •  Provides insight into what’s working and what’s not.
  •  It improves the efficiency of resource allocation.
  • Using social media marketing effectively will improve your results. 

Now that we know social media’s R.O.I. basics let’s learn to measure it.

Gilad Krein Explains How to Calculate social media’s R.O.I. For Your Online Business

Gilad Krein is a digital entrepreneur and an online business strategist with a massive following. He is also a digital nomad who runs a personal blog sharing his business wisdom.

He’s shared a simple 4-step formula to measure social media R.O.I.

Gilad Krein’s Method to Measure Social Media’s R.O.I

Here’s his step-by-step guide to calculating your social media R.O.I.:

Define Your Goals

The first step is to define your goals. In what ways do you want to use social media marketing to achieve your goals?

Are you looking to increase brand awareness? Or do you want to drive traffic to your website? Generate leads? Sell more products or services?

Deciding to start can be challenging.

The following are some common social media goals that online businesses aim to achieve:

  • Followers
  • Page Likes
  • Engagement (Post Likes, Comments, Shares)
  • Queries
  • Leads
  • Sales


So, select clearly defined goals before you can measure your R.O.I.

Bonus Tip: Learn to set S.M.A.R.T. goals to get better results.

Identify Your Metrics and Analyze Them

Once you know what you want to achieve, identify the metrics, you’ll use to track your progress.

For example, track metrics like brand mentions, website traffic, and social media reach if you’re trying to increase brand awareness.

Your Facebook or Instagram page followers will give you an estimated idea about your social media reach. On the other hand, website analytics would tell you about your monthly traffic and its source.

However, for detailed and effective analytics, you can use all-in-one social media analytics tools to do the math.

Use a tool that measures your desired metrics, creates easy-to-understand reports, and suits your budget.

Determine the Costs Of Your Social Media Efforts

The next step is to calculate the cost of your social media marketing efforts. This step includes both the monetary and time investments that you’ve made.

Sounds confusing?

Don’t worry — here is a break-down of typical social media marketing costs:

Time: Consider the time you or your marketing team have invested in social media marketing.

This process includes the time you’ve spent creating content, managing your social media accounts, and analyzing your results.

Content Creation: You will need to account for the content creation cost if you create original content for your social media channels.

This accounting includes the cost of any graphic design, video production, or copywriting you’ve had to outsource.

Social Media Tools: Many social media management tools are available to help you save time and maximize your social media marketing efforts. You’ll have to factor in their monthly costs to use any of these tools.

 Ad Spend: Finally, if you’re running social media ads, you’ll need to include your ad spend in your calculation.

Calculate Your R.O.I.

You can calculate your social media ROI using the earlier formula once you have determined all your costs.

Let’s say you want to measure social media R.O.I. for sales or total revenue generated through social media.

Based on generating $3000 in revenue and spending $1200 on social media marketing, your social media ROI would be:

[ ($3,000 – $1,200 ) / $1,200 ] x 100 = 150% ROI

This means that for every dollar you spent on social media marketing, you generated $2.50 in revenue.

That’s a decent R.O.I.

Review your social media strategy carefully if your return on investment is less than 0. With that said, let’s look at a few ways you can improve your social media R.O.I.

Gilad Krein’s Tips to Increase Social Media R.O.I. For Your Online Business

Create Effective Buyer Persona

If you don’t know your target audience, your social media and all marketing efforts will go to waste.

So, learn to create a detailed buyer persona for your online business. It is key to increasing your social media R.O.I.

Publish Relevant Content for Your Online Business

Publishing content relevant to your buyer persona ensures your audience sticks around for long. You’ll be on course to more views and engagement if you keep publishing relevant content.

Test and Improve Your Content

Always test and improve your content to see what works best for your audience. Experiment with different content types and strategies to see what gets the best engagement and R.O.I. 

Follow the above tips to increase your social media R.O.I. if brand reach and engagement are your goals.

Try investing in social media lead generation tools, compelling copywriting, and better ad targeting for more leads and conversions.

So, this is it – you can now go back to work and measure social media R.O.I. for different goals!

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