An online quipster poised the question: “How do you measure the return on investment (ROI) of social media marketing?”  He then answered his own question with “You don’t.”

Fortunately, that’s not exactly true.

As  businesses scramble to set up Facebook, Twitter and MySpace pages, analysts are scrambling to discover how impactful their company’s SMM has been. For some, the answer is “we can’t measure this,” but others believe there are statistics that reflect their SMM’s effect.

As Aaron Uhrmacher, the guru of social media, recently said in an article on Mashable,   “Social media measurement is one of those topics about which everyone has an opinion, but nobody agrees on the solution.”  His suggestion – - as a beginning point – - is to simply decide on what to measure.

What’s Your Social Media Marketing Goal?

If your goal is to increase your reputation–get potential clients talking about you in a positive manner – -  then get out onto the social media sites and monitor what’s being said about you.

In a brief run-through searching Twitter, I found some very mean-spirited comments about a specific entrepreneur’s e-mail campaign. At another site, a customer was complaining that it took days for a company’s customer service department to contact her . . . leading her to wonder if  she was dealing with a real company or a scammer.

In both instances, a social media point of contact–shall we call it a czar?! -  could have reached out to customers via direct message or e-mail and turned a damaging situation into a win-win. After all,  social media is about “social” – - building relationships.

If your goal with your SMM is to measure traffic, then setting up a solid analytics program that tracks incoming links will tell you if your visitors are coming from Twitter, Facebook, etc.

Although Google Analyltics are excellent (and free), we also suggest Xinu, a free site that tells how your website is doing in terms of search engines, search engine optimization, social bookmarking, RSS, and other social indicators.

Measuring ROI on social media marketing isn’t a precise science; but what we know for sure is that businesses and entrepreneurs need to have a success metric in mind before jumping into the game.

This just in from Marketing Sherpa (and reprinted with their permission)

“The most significant barrier to social media adoption named by 46% of respondents to a MarketingSherpa survey is “lack of knowledgeable staff” – whether an organization has used social media marketing and PR or not.

A danger to the effective adoption of social media as a marketing strategy is the large percentage of those who consider themselves knowledgeable – but have no social media experience.

Two-thirds of marketers at organizations that have not used social media marketing or PR said they are “very” or “somewhat” knowledgeable about the subject. Without social media experience, however, this level of knowledge is unlikely. It may be the reason “lack of knowledgeable staff” is seen as the most significant barrier.

There is good news, though. Lessons come fast once an organization engages with social media. Until those lessons are learned, though, initial missteps could lead to marketers abandoning the program.

A stagnant Facebook group doesn’t mean that ‘social media just isn’t for us’ – it simply suggests that there’s more to learn. Over the next several weeks, we’ll explore social media with charts from MarketingSherpa’s upcoming report.”

Nancy’s Take
The majority of my clients – particularly those in higher education – suffer from both lack of knowledge and inability to track ROI. In fact, I’ve spent three months trying to pry analytics out of one college client; their delay isn’t because they don’t want to share, but because no one knows where to find them!

Of all industries, higher education should (IMHO) be the ones on the front line of the social media revolution . . . after all, it’s where their target market lives. I’m sharing this chart with my client and hoping it will prompt a little action on their part.  As the report shows, just because the initial Facebook page isn’t getting any love doesn’t mean to ditch it – but rather to pay attention to it!