What does ROI mean in social media terms

Transformer Marketing, CA, Return on InvestmentWhen you hear the term, return on investment-also known as ROI, we tend to think of new customers due to a marketing or sales event.  We invest our time, efforts and money into a platform.  When we get new business from our efforts, we have a return on investment.

Dictionary.com defines return on investment as, “the amount of profit, before tax and after depreciation, from an investment made, usually expressed as a percentage of the original total cost invested.  Abbreviation:  ROI.”

You see cold hard cash from your efforts.  Methods such as print, television, billboard ads, and luncheon or dinner seminars, are all methods which produce immediate results.

Reaching People

Measuring a return on investment with cold hard cash is difficult to do using social media.  It is not impossible nor is it unheard of.  Maybe you did get a sale from your Facebook post or your email campaign.  Maybe someone did contact you through your blog and purchased a policy.  But you don’t always hear or see that from your customers new or old.

Instead the way to measure a return on investment for your social media marketing plan is to see how many Facebook “likes” you get (not the fake ones-we will get into that later), how many “re-tweets” your tweet produced.  How many people saw your article, and how many people clicked on your email campaign.


It takes patience to see a return on investment.  Your brand needs to be built and a marketing plan with reasonable objectives needs to be in place.  Once your plan is in motion it will take time to see viable data.  The more people we reach, the more people you are getting people to think about your products and services.  Maybe Joe Smith is not ready for that homeowners policy because he’s a renter.  However, when the time comes for a homeowners policy, Joe will call you because of your social media marketing plan.

If you are interested in more information about social media marketing for insurance companies, give one of our experts a call at 909-547-6212 ext. 5920.

Content provided by Transformer Marketing and Dictionary.com

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