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7 Essential Social Media KPIs You Must Track for Business Profitability

You cannot optimize what you do not measure.

Figuring out what to track in social media metrics is key to a profitable social media campaign.

The vast data trove from various social media analytics tools compounds the problem of identifying which metrics are important.

Do the number of followers matter? What about the number of likes or post views?

With any marketing, measuring the right metrics helps you make smarter decisions and improves your campaign performance.

A Warning On Tracking Vanity Metrics

Confusion abounds over which metric is important.

With all the companies we work with, we avoid measuring or tracking any vanity metrics. Vanity metrics may look impressive but offer little value and insight into the impact on business outcomes such as Return on Investment (ROI).

In a nutshell, if a metric doesn't improve your business ROI, don't waste your time tracking it.

Typical vanity metrics may include tracking the number of likes, followers, post/video views, comments, and open rates.

Many companies advocate measuring social media reach or audience growth rates. We don't believe that these metrics are of great use because they are not reflective of what's necessarily happening in a business.

For example, Company A has 100,000 Facebook followers, and Company B has 10 followers. Does it mean that Company B makes less? Possible, but not necessarily so.

Also, just because Company A has a potential audience size of 100,000 followers doesn't mean they get 100,000 views for every new post they put up. They get a lot less in actuality because Facebook's algorithm does not display the latest post in every one of Company A's followers feeds.

Some companies also get caught up in chasing Facebook' Likes'.

Which would you rather have - a visitor to your Facebook page who liked your page or a visitor who clicked over to your site and bought something? I'd be willing to venture a guess that every one of you reading this wants the latter.

Realize that some people don't wish to 'Like a page' but would buy something if it resonates with what they wanted.

Tracking of the Right Social Media KPIs

With the sheer number of metrics available to sort through and limited time to do so, it is crucial to stay on top of only the critical KPIs based on your desired goals.

Tracking many KPIs may seem helpful at first. In reality, it ends up being a busy-ness that doesn't produce results. Are you in business to create regular 20-page reports on social media activities, or are you in it to make money for your business?

When there are too many KPIs to track, you spend an excessive amount of time recording the numbers and not having enough time dedicated to analyzing it for increased performance.

Zero in on the proper balance of KPIs to analyze for meaningful business outcomes.

Opt to draw upon additional metrics later if something might help explain unusual activity or troubleshoot social advertising issues.

This article will identify the most important social media metrics, why you need to track them, and how to measure or obtain the numbers. These form an excellent foundation for a sound approach to social media campaign analytics.

Useful metrics form the backbone of a well-executed social media campaign that delivers results on your company's social media strategy.

Consistent tracking and documenting of all the right metrics you decide to measure in a central document helps keep you on track to reach your goals.

You track some data weekly and others monthly.

Whether you are managing social media campaigns on social media as an agency or reporting to upper management, we've distilled into 7 top social media metrics to track and make you look like a hero.

The 7 Critical Social Media Metrics For A Successful Campaign

  1. Social Media Engagement
  2. Amplification Rates
  3. Social Media Referrals By Channel
  4. Cost Per Acquisition
  5. Click-Through Rates
  6. Conversion Rates
  7. Bounce Rates

Metric #1: Social Media Engagement

Engagement is the metric that measures the number of people interacting with your social media content relative to your followers. Depending on your business's needle movers, social engagement can be post likes, comments, shares, clicks, or saves.

Courtesy of Facebook

Why Measure Social Media Engagement?

Suppose you are posting social media content that lacks interaction. In that case, it speaks either one of two possibilities: you are targeting the wrong audience, or your content is not very interesting.

If no one interacts, you might as well be speaking to a wall because no one is listening or watching what your company is doing.

Thus, your engagement rate reveals how interested your audience is, the type of content they prefer, and what content just doesn't cut it.

Knowing what your engagement KPIs keep you on target with your audience. Look for patterns such as the type of content people prefer to engage with and on which social platform.

To get more tips on creating the right content that engages, review our comprehensive content marketing post.

For larger companies, you may also measure a form of engagement rate on a platform like Twitter. Many companies use Twitter as a customer service channel, and customers love to engage with social media brands. They may leave reviews or request customer service. The speed at which you respond and how you respond affects your company's reputation and trust.

How to Measure Engagement

Each social media platform reports the engagement rate of each ad you run. You won't know what your engagement rate should be until you test multiple ads to determine what a typical engagement looks like in your account. Conduct extensive A/B testing by testing one variable at a time. Pit the winners against a new ad and continue to refine results over time.

To calculate engagement levels, you'll need the total number of engagement responses and the total number of followers.

Metric #2: Amplification Rate

Google's digital marketing evangelist, Avinash Kaushik, first began defining amplification rate as the rate at which your followers take your content and share it through their networks". It's sort of like the ratio of shares for each social media post.

Why Measure Social Amplification Rate

Likes and comments are great, but they don't expand your reach. If your followers shared your content, new audiences know about your content without having to pay for the additional exposure.

When your current followers are actively sharing your content with others outside your network, your followers are effectively your advocates.

Observing the growth rates of this metric lets you know when any of your posts go viral. It helps you understand what your audience wants and thereby informs your future social media content efforts.

How to Measure Social Amplification Rate

While many other metrics are provided readily on your social media platforms, amplification rate metrics require you to do some calculations. To measure your amplification rate, you need the total number of posts re-posted or shared and the total followers from the social media platform.

Metric #3: Social Media Referrals By Channel

Referral traffic measures the number of visitors coming to your site from social media. Clicks from a social media post to your site count as referral traffic that you track with your web analytics software.

Why Measure Social Media Referral Visits By Channel

When people leave their social profiles by clicking over to your website, it demonstrates a heightened interest by your visitor for what you are offering.

Suppose people engage with your social media posts but never click over to your site. In that case, you have less control over what happens with the visitor since they can be easily distracted and navigate somewhere else.

When visitors see your social media post and click over to your site, however, you can dictate a greater level of control over what that visitor does on your site by the call-to-actions (CTAs) you place throughout your site.

How you capitalize on visitors who leave their profiles to visit your site helps you understand which content is compelling enough with your followers. Knowing what speaks to your followers enables you to improve your social media strategy in the future.

Measuring by channel also lets you know where to focus your energies on your chosen marketing mediums.

Different platforms have different audiences, and knowing where they reside most helps you concentrate your resources on those channels that deliver quality traffic.

How to Measure Social Media Referral Visits

As mentioned earlier, it is measured using your preferred web analytics software. The most popular analytics package that is also free is Google Analytics. To see which networks drive traffic, click on Acquisition, followed by Social.

An advanced method of tracking these visits involve UTM parameters. UTM codes help separate organic referrals from paid ad referrals.

Metric #4: Cost Per Acquisition or Cost Per Action (CPA)

For social media advertisers, CPA is what it cost to achieve a conversion factoring in the costs of all your ad clicks.

Why Measure CPA

Rather than tracking Cost Per Click (CPC) alone, we monitor the metric that makes a difference - your cost to acquire each customer.

Keep in mind that while CPCs may seem expensive at the outset, the customer's lifetime value is more significant.

The marketing legend Dan Kennedy put it best:

"The business that can spend the most to acquire a customer wins."

An efficiently run social media campaign coupled with a highly optimized business gives you room to up your ad spend and dominate your competitors.

How do you ensure an optimized business? Make sure that you maximize the lifetime value of all your customers and deliver outstanding value that makes growth self-sustaining. We call this the Growth Flywheel.

CPA affects your Return On Ad Spend (ROAS) and thus your Return on Investment (ROI).

Thus, this metric is CRITICAL for your business.

To determine profitability, compare your CPA with your social ad spend on that platform. If the CPA is higher than the social media ad expenditure, the ROI becomes negative. If your CPA is equal to ad spend, you're breaking even.

How to Measure CPA

The social ad platform you use will calculate your CPA for you. Watch your CPA like a hawk to ensure you're always making money on your ad spend or at least breaking even.

You'll can collect the cost per click and the total number of ad clicks from the social media ad platform if you wish to calculate your cost per acquisition on your own.

Metric #5: Click Through Rate (CTR)

CTR tracks the number of people clicking on your ad or content over to your site's landing page. If you're paying for ads, it is especially vital to drive clicks to a landing page with a clearly defined CTA. In an ecommerce store, the appropriate landing page would be the product page or a special promotion page featuring the same product you advertised.

Why Measure CTRs?

Well, it's pretty straightforward, especially if you are paying for ads. You want to make sure your ads are converting by the click-throughs to your site, followed by conversion while on your site.

For advertisers on the various platforms, ad relevance gets rewarded by resulting in paying lower ad costs. Thus, high CTRs get more exposure through impressions and better placements at a lower ongoing ad cost.

If CTRs are low, the probability is high that your content is not what your audience is seeking.

How to Measure CTR

The social media platforms will automatically calculate your ad CTR, so you don't have to manually.

In Facebook ads, click on the Ads tab and select the Performance and Clicks column view.

Two factors are needed from the ad platform: total number of clicks and total number of impressions.

Metric #6: Conversion Rates

First, to determine conversions, you need to define what a conversion looks like for your business. This metric is measured differently for each company, so one way that works for one business may not work in your business.

It all boils down to your business goals.

For some, you'd define conversion as a purchase. For others, you'd define conversion as the number of subscribers.

More examples of possible conversions are newsletter signups, the number of downloads of ungated/gated content, podcast listenership, registration for webinars, requests for more information by visitors, etc.

Why Measure Conversion Rates

If you want to achieve a return on investment for your business, you want to measure your conversion rate. If your post achieves a high conversion rate, it means your post was highly congruent with the offer.

In social media advertising, a high conversion rate signifies a lower cost per customer acquisition.

How to Measure Conversion Rates

Conversion rate is simply the number of people who click over to your content from social media to complete the pre-defined conversion.

These are set up as Goals under Google Analytics if you are trying to identify conversion by traffic source.

For reference, here's what you need: the number of conversions and total number of clicks paid for.

Metric #7: Bounce Rate

This metric is about eliminating waste.

While you would try to hit higher numbers for most of the other metrics above, the bounce rate is a figure you want to maintain as low as possible.

Your bounce rate measures the number of people who clicked over to your landing page and clicked away after a short time. You define this "short amount of time" beforehand based on the content on your landing page.

For example, suppose it is a product page your ad drove clicks to, and the visitor clicked away immediately. In that case, it shows one of three possibilities: a problem with your ad's promise, or that your product page wasn't very well-designed from the start.

If the visitor is clicking over to your site from social media and clicking away shortly after (usually less than 3 seconds), it is a sure sign your site isn't meeting your users' needs.

Why Measure Bounce Rates

Low bounce rates indicate that your site delivers the value your visitors seek.

High bounce rates point to something being wrong somewhere. It may either be with the social media post or your site's content that will require immediate corrective action.

How to Measure Bounce Rates

You can track this metric using your favorite web analytics software. To retrieve your bounce rate data in Google Analytics, click on the Acquisition tab, followed by All Traffic. You then segment the data according to the Channels.

The bounce rate is the result of two factors, total one-page visits and total entrance visits.

Conclusion - Track What's Truly Important

Tracking these metrics helps boost your overall ad campaign performance and lets you know what needs fixing.

The right metrics inform you whether your campaign is successful over some time. When you keep tabs on what's happening on your campaign, you ensure a more beneficial impact on your business' bottom line.

One final word: Make it a point to keep a record of KPIs consistently for the data to be useful.

There you have it. Now, build your KPI tracking sheet and monitor your KPIs.

Let us know your experiences or successes with tracking these KPIs. If there are any essential metrics we should have covered, do comment below.

 

About the Author:
Anthony Yap is the founder of Art Of ROI, a digital marketing agency. He is an entrepreneur at heart who understands the challenges business owners face in growing their businesses.

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7 Essential Social Media KPIs You Must Track for Business Profitability

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