What’s the true ROI of Social Media?

Social Media ROI

Since the day social media gained traction as a business marketing tool, the question of its value, effectiveness and return on investment (ROI) has been a hot-topic discussion within boardrooms, at the watercooler, among internet forums, blogs, social networks, and at parks and beaches. Well, probably not parks and beaches, with the exception of a few passionate Grease Monkeys.

While many professionals were quick to comprehend that social media is a much different weapon within the marketing arsenal than conventional tools, others are still struggling with how to attach a true, reliable ROI to Social Media. The disbeliever’s unrelenting disavowal may be due to a variety of factors, but I dare to wager that nearly all fail to see the more obscure, underlying ROI of social media – the risk of ignoring, which I also like to refer to as “the loss from avoiding.”

Whether its accepted or not, all businesses now have a social media presence. By ignoring it, a business is not saving money in the long-run. Instead, such a business’ assets are placed at the mercy of its competitors.

For example, a customer named Bill writes on his Facebook Page and Twitter handle that he would like to purchase widgets in his hometown of Widgetville. While a store, rightfully named NoSocial Widgets, has chosen to ignore social media, a competing store, SOcial Widgets, is quite active. Immediately, SOcial Widgets responds to Bill with an offer and claims his loyal business to fulfill large widget orders for many decades.

Another example is Cathy, who is a current customer of NoSocial Widgets, but recently had a terrible experience. She takes to social media with her complaints, but never receives customer service from NoSocial. Instead, Cathy gets a response from a polite SOcial Widgets rep who assures her that such an experience would never occur at SOcial Widgets. The rep even offers Cathy a coupon! She’s so thrilled with the SOcial Widgets experience that she tells all of her family, friends and Widgetville neighbors to only do business with SOcial.

These are but a couple of basic examples, out of an endless list of possibilities. Such scenarios clearly demonstrate that in the absence of a managed social media presence, exposures to a damaged brand image, reputation and poor customer service are extremely likely. Turning a blind eye will never prevent the social conversations from happening, it just simply removes a business’ voice from the equation and disables any kind of defense from competitors, dissatisfied or unreasonable customers, internet trolls and possibly even hackers.

Real-World Social Media ROI

Return on investment is a simple concept for most; you put money into a budget and expect more money in return as profit. Unfortunately, it is this simplicity that often blinds many business owners and executives to the true ROI of social media – the risk of ignoring it. While making money, reducing budgets and maintaining growth are more-often-than-not the end-all goals of most businesses, protecting brand image, reputation and customer service enables their realization. Therefore, it’s incorrect to believe that a social media investment is not worthy if it can’t produce immediate, tangible returns. The reduction of risk and loss begins the very second an organization starts to manage its presence and engage with fans, followers and potential customers. The short and long-term value of this protection far outweighs the benefits and returns that a traditional ROI seeks to demonstrate.

Have you ever done business, or witnessed the effects of ignoring social media? Tell me about your experiences in the comments section below.

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Cj is an SEO/Content Specialist at DPS. His previous work experience includes serving as a Social Media Manager for a digital media agency in Chicago, working on accounts for several large retailers and an insurance organization. Prior to that, Cj was managing social media and online PR for clients of a firm serving franchise concepts throughout the United States and Canada.


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