Social media marketing is everywhere. From pop stars to reality TV stars, from big brand names to small businesses, from internet marketers to MLM, you cannot be taken seriously unless you have a social network presence. It seems the more fans and followers you accumulate, the more popular you supposedly are.

Is anyone making money?

It is far from clear whether there is real value of social networking in terms of return on investment. How does this online media frenzy benefit your business or does it just burn a hole in your time freedom, outsourcing or advertising budget?

Research from eMarketer* indicates that almost half of brands are unconvinced that social marketing’s offers real value as a advertising investment, be it time or money, and has shown the lack of clear measurements of impact and ROI from social media marketing are the reason most social efforts remain low.

What is striking is the conclusion that “While relatively few marketers reported social was pointless and overhyped or too complicated to deal with, most are still not increasing revenues or otherwise profiting from their social efforts.”

In fact of the half that had some kind of social media marketing campaign going, only about a third felt it was making them money!

What can you measure?

In an attempt to crack the complexity, Cisco have developed a social media measurement framework as a guide and resource for their internal teams to help determine what and how to measure for their social media programs and initiatives.

The measurement “streams” group the most common goals and ties them back to potential key performance indicators and metrics to track them. Hard ROI type quantitative impact measures are certainly difficult to pin down for social media marketing. The environment is completely different to the straightforward cause and effect of most pay-per-click advertising strategies.

With social media marketing, you have to track what is happening in the wider sense first, and extrapolate, thus assessing some of the softer benefits than can have a financial impact further down the line.

6 ways to assess ROI

Here are six ways you can start to assess whether social media marketing is working and your business is actually making money online:

1. Have a clear strategy for your social media marketing. Decide if it is for brand awareness, reputation building, networking, lead generation. Set targets for number of followers or fans, number of leads and assess against daily, weekly, monthly activity over time.

2. Add tracking codes to every aspect of your social media marketing so that you can attribute lead generation to different parts of your strategy specifically and follow them through your sales funnel.

3. Analyse your costs per lead, cost per conversion, cost against earnings etc. For each tracked aspect of your social media marketing campaigns, such as tweets, Facebook posts or social network PPC, videos etc. right down to the specific ad copy for any given posting or page.

4. Analyse your demographics, by using your own tracking, Facebook reporting, or different twitter profiles, or with Google Analytics. Again, track through your entire sales funnel, from impressions to clicks to leads to front end sales to back end commissions to see if there are patterns of people (gender, location, interests etc) who convert highest and are thus most targeted ‘hot’ prospects to focus on going forward.

5. Incorporate feedback activities into your marketing, such as questionnaires (e.g. Survey Monkey) based on open, focus group type questions that ask specifically how people found you, what they like/don’t like about what you do/provide.

6. You should follow up on the ways people enter your social media marketing networks and build out your marketing from there. For instance, you can use tools in Alexa to see where people come from when they visit your site and where they go next!

These are the very basics metrics you should be reviewing. At its very best, social media marketing can be an effective way of attracting highly targeted prospects into your sales funnel.

However, the path to securing a real return on costs in terms of time and paid advertising has far more to do with building trust than selling technique. Social networks are not the place for blatant sales pitches, in fact businesses and individuals show their ignorance and lack of professionalism with that approach.

Rather, social media marketing has everything to do with the development of authentic relationships and giving good value and service to others, a strategy which fosters social proof, long term customers and loyalty.

Let’s say you’ve got an awesome twitter growth strategy. You’ve got quality content coming from your blog. You’ve got kick-butt social marketing integration that really ties the room together. There’s no question, if you tweet it they will come-but how do you steamline your social media for faster results, less invested time, and greater ROI?

Well, that’s easy. You let the wonders of technology do the heavy lifting for you.

At this point in the game there are only two pieces of twitter marketing software that you will ever need: HootSuite and TweetAdder. With them you can accomplish every task your little blue bird heart desires, including tweet automation, follower management, keyword searching, and more.

Getting Followers While You Sleep with TweetAdder

I have so much praise for TweetAdder’s marketing tools that in our upcoming “Essential Guide to Getting Twitter Followers” eBook I’m devoting an entire chapter to it. It’s the must-have twitter software for marketers, and that goes double if you’re managing multiple accounts. At $55 for a basic license (less if you use Retail Me Not) it isn’t cheap, but if you’re serious about marketing this tool will pay for itself a thousand times over. Here’s a quick breakdown of features you need to be using if you want to step up your social media game.

RSS - To gain followers organically you need to tweet, and tweet consistently. TweetAdder’s RSS function lets you automatically tweet new blog posts from your favorite sources throughout the day so that your feed never gets old. You can control the maximum amount of daily updates and variable timing between tweets. You can even set different hashtags to pin on, such as #marketing, so that you get the most interaction possible from each update.

Follower Management - Automatically follow those who follow you, and stop following once you hit a certain ratio (1.2 follows to followers, for example.) You can automatically unfollow accounts who do not follow you back after a certain amount of time, and control it so that only mass-added follows made with TweetAdder are affected.

Find New People to Follow - Search based on keywords to target accounts in your industry or area. For marketers, search your demographic and start reaching out. Add these accounts to a list that you can follow all at once or gradually follow over a period of time. You can automatically stop adding new follows once you hit a certain ratio.

Thank You Messages - This is a critical area for marketers, especially when we get into the hundreds of reasons you should be content marketing. Automatically direct message a thank you and an ebook, a blog post, or an offer every time you get a new follower so that you can drive traffic to your website or landing page.

There are oodles of other features in TweetAdder, but I consider those the most critical. Other features, such as automatically generating tweets, auto-RTing, and auto-replying, are tricky to use without making it blatantly clear you’re using a twitter bot. With TweetAdder you can manage additional accounts (for an additional price) making it very worthwhile for when you have a ton of clients on your plate. Just be careful with TweetAdder and user your powers for good, not evil. Nobody likes a spammer, and if you’re using the program correctly nothing should look out of the ordinary.

HootSuite: Monitor Everything You Need

TweetAdder is fine for automating your workload, but what about when you need to get hands-on? HootSuite is the best management software for the job, and if you’re part of a marketing team, it only gets better. Here’s a breakdown of my favorite features:

Full Social Media Integration - HootSuite isn’t just a twitter tool, it’s a social-everything tool. Post updates to multiple twitter accounts, facebook accounts, linked in groups, and more all at the same time. Or don’t. Post messages, photos, links, and more to only one of those things. It’s your tool, man, I don’t judge.

Monitor Multiple Feeds at Once - At a glance, monitor your outgoing tweets, your direct messages, your news feed, keywords, and people talking about you all in side-by-side feeds.

Tabbed Browsing - Switch between different feeds by clicking on tabs. How cool is that?

Detailed Analytics - Basic analytics support (interaction, click-throughs) comes from ow.ly, but if you’re willing to spend a little bit extra you can get incredibly in-depth breakdowns of your growth rate, interactions, follower demographics, and more. This is FANTASTIC when you want to be able to show quantifiable results for your brand or client.

Project and team-based collaboration - You can create projects, assign teams of users, and manage to-do lists all from within HootSuite, letting you effectively communicate with the rest of your marketing team.

HootSuite and TweetAdder aren’t the only game in managing your Twitter account, but they’re the big dogs for a reason, they’re comprehensive, and the price tag that comes along with TweetAdder and HootSuite Pro is low enough to not be an issue. It’s your ticket to better results, and you’ll notice the difference immediately.

If you’re an agency, another option well worth mentioning is newcomer Sprout Social. For managing clients and creating in depth reports, their eye-catching interface and analytics can’t be beat. at $59 a month per user it’s the Rolls Royce of social media management services, but in this consultant’s opinion, if you can afford it, it’s worth every penny.