What Your Social Media Analytics Can Tell You About the ROI of Social Media Marketing

What Your Social Media Analytics Can Tell You About the ROI of Social Media Marketing

Social media marketing is the best way to get consistent attention and engagement from people for any business, especially in this era of digital media and social media apps like Facebook, Twitter, Instagram, Pinterest, YouTube, Google+, Linkedin, Tumblr, Blogs, Reddit and many others. With the advent of social media apps like Snapchat, Instagram stories, etc., people now spend more time on social media apps than other online sites/portals. 


“Likes” and “followers,” tell you nothing about whether those actions will drive sales to your business. But, now there’s a new breed of social media analytics tools that can give you valuable insight into the ROI of your social media marketing. In this article, I’ll explain what social media analytics are, how they work, and how they can tell you about the ROI of social media marketing.


Social Media Analytics Market is expected to reach 9.6 billion by 2026, growing at a robust CAGR of 24% between 2017 and 2026. The major factors driving the growth of this market include new product launches, increasing adoption of cloud-based solutions, rising customer expectations, and various government initiatives. 


Moreover, Social media analytics helps businesses, influencers, and corporates in collecting and analyzing the data for making business decisions for online platforms. Social media analytics goes beyond the number of likes and views.


What Is Social Media Analytics and How It Plays An Important Role In Social Media Marketing?

The social media analytics market has been segmented into two components: solutions and services. Adopting a social media analytics solution is necessary for a company to experience rapid growth in its business performance by providing essential data about its customer base. This growth is seen in almost every sector, including telecom, BSFI, health care, life science, fashion, e-commerce, Government and defense, media and entertainment, hospitality, travel, education, transportation, and industrial verticals as well.  


The 4 four types of social media analytics are as follows:

1. Descriptive analytics: Descriptive analytics is the examination of data to answer the question “what is happening or What happened?”

These analytics gather similar types of data together and visualize them in pie charts, bar graphs, tables, or generated narratives.


2. Diagnostic analysis: Diagnostic analysis focuses on counts, follower numbers, page views, reviews, and shares.


By comparing different campaigns or post engagement, you can determine what your consumer likes.


3. Predictive analysis: Predictive analysis focuses on predicting future trends based on existing data, like predicting the consumer behavior shift, possible visits to a particular location, etc.



4. Prescriptive analysis: Prescriptive analysis helps in providing the best way to proceed at any given moment.


It ranges from handling social media crises and incidents to purchase preferences.


Social media analytics plays a vital role in social media marketing.

When you’re ready to buy a social media analytics solution, you can choose either on-premises or cloud-based deployment models. On-premises deployment is hardware and software configuration on the customer’s own premises. 


There are many benefits to using cloud-based solutions for social media analytics. The cloud deployment model, a social media analytics solution, is offered as SaaS (social media data warehousing), and all the workloads are cloud-based. Cloud-based solutions are increasingly becoming popular with end-users, especially for businesses that require real-time data accessibility. Cloud-based solutions significantly reduce maintenance and operational expenses, as cloud systems can be easily scaled up or down depending on requirements.


  • It helps you make concrete decisions as it gives us data about the performance and how it can impact your company. 
  • It enables you to discover which social media platforms can provide you with the most traffic.
  • It assists you in calculating the return on investment (ROI) of your social media marketing and lets you know which campaigns to invest in.
  • It enables you to recognize what content works best with what social media platform.
  • It lets you make sure that you’re pulling traffic from the right demographics with social media.
  • It helps you examine how many sales conversions your business gets from social media.


Some of the standard tools to analyze social media accounts are:

  • Sprout Social.
  • HubSpot.
  • TapInfluence.
  • BuzzSumo.
  • Snaplytics.
  • Curalate.
  • Keyhole.
  • Google Analytics.
  • Talkwalker Free Social Search.


How Social Media Analytics Can Tell You About the ROI of Social Media Marketing? 

Did you know that every dollar you spend on social media marketing translates to $3 in ROI? In his Forbes article called The Best Social Media Marketing Tip Ever, Mark Schaefer talks about how important it is to know your return on investment when using social media marketing. How do you do this? Well, there are quite a few social media analytics tools out there that will help you evaluate your social media marketing efforts.


Social media return on investment (ROI) is a metric showing the amount of value generated by your investments in social media. However, in cases where the direct impact of SMM on revenue is difficult to attribute, ROI can first be quantified by non-monetary metrics like brand awareness, and followers post engagement.


Social media algorithms are frequently evolving, and keeping a check on ROI can help you run a robust and effective ad campaign. The most common and often vital metrics to pay attention to are our engagement, impressions and reach, the share of voice, referrals, conversions, and response rate and time. When you combine these, you’ll have a swiveling snapshot of your social media performance.

The following is by far the most basic social media ROI formula:



  • Profit: The amount of money you’ve generated from social media marketing.
  • Investment: The overall cost of your social media marketing activities 


You can use this formula and quickly figure out your return on investment on social media campaigns.

Social media ROI metrics can help you increase your business if you can correctly interpret the data. Analyze each social media platform, the amount you spend on the ads, and the revenue you generated through them. Scrutinize the regions, gender, and age group and find the profitable areas and those that fell short. Plan your next campaign according to all the data analyzed for more profit.



Social media analytics can help you boost your business if analyzed correctly. They give you a lot of information that can help you strategize your future business action plans. It informs you about the behavior of consumers and the possible shift in their behavior due to new market trends. The most important metrics to track are return on investment (ROI), impressions, likes, comments, and shares. Metrics like impressions, likes, comments, and shares tell us about what content is gaining the audience’s attention and what they want to see more. Since cloud-based solutions are becoming popular, many companies like Algoscale are now switching to cloud-based solutions for their social media analytics needs. 

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