How to Calculate ROI of Social Media Accounts

Digital marketers spend a lot of time and effort building and engaging audiences on their social media channels. Not understanding the Return on Inventment (ROI) of each channel is a common mistake for anyone trying to make a living on the internet. Here is what you need to know about social media ROI.

See Also:

How to Calculate ROI on Social Media Channels


Evaluate your goals. Bloggers without any products need to figure out the value of their time and how to maximize their efforts.

Existential Goal

The ultimate desired outcome of all your striving. Why are you doing what you’re doing? Why are we here? Is time really a flat circle? Heavy Stuff

Practical Goal

If you’re a business this probably means money. If you’re a blogger, this could mean notoreity or views. Each business must have a practical (attainable) goal.

Desired Action

Think checkouts, lead generations, clicks, follows, shares, comments and email collections. These are the desired actions taken by users or customers that you add up to help you reach your practical goals.


This could be writing, design, talking, posting, curating, etc. The work you put in to create incentive for your users or customers to perform a desired action.

Goals usually translate to money so it’s pretty easy to assign value to a sale – just find the average. If you want to find the value of a pageview or a lead, then you need to know what percentage of those conversations turn into money for you down the line. If three of every 10 leads convert into sales with an average of $100 per sale, then your leads are worth $30. The further removed from an exchange of goods for currency, the harder it is to assign a a value to an action.

Then there’s the matter of attribution. Is your social traffic actually responisble for the pageview that led to a conversation which then led to a sale? Which post on which social media network was initially responsible for the most sales? The more specific you are with your attribution, the more chance there is for error.

Tools for Social Media ROI

How To Calculate ROI

  • Add up the total cost of your investment.
  • ROI = (Value of Action – Cost of investment) Divided by cost of investment

Iteration is key to good ROI – Once you know the actual return for your social efforts it’s where your followers live and reduce your time on less valuable channels. Work on your messaging and value propositions that inspire engagement with your calls to action. Consider ad buys and promotion. Just don’t expect that doing the same thing over and over will continue to provide the same result.