ROI of Social Media Manager:Do You Really Need a Social Media Manager?
Social media is huge these days, right? Instagram, TikTok, Twitter, Facebook, YouTube – everyone is on these apps consuming content, sharing memes, and trying to get more likes and followers.
For businesses and personal brands looking to grow and get more exposure, social media seems like an absolute must. But managing all those different platforms and accounts can quickly become a major time-suck and organizational headache.
That’s where the idea of hiring a dedicated social media manager comes into play. But can paying someone’s full salary just to handle your social media presence actually pay off? What kind of return on investment (ROI) could you realistically expect? Let’s break it down.
What Is a Social Media Manager?
A social media manager is someone whose core job responsibilities revolve around representing a brand, company or public figure on social media channels. Their duties typically include:
– Creating and scheduling social media posts across multiple platforms
– Designing and editing visual graphics, photos, and videos for social content
– Writing captions, promotional copy and other messaging
– Running paid advertising and promotional campaigns
– Tracking and analyzing performance metrics
– Engaging with followers by responding to comments/messages
– Monitoring social media trends, viral topics, etc.
– Developing an overall social media content strategy and calendar
Depending on the size of the organization, social media management could be a dedicated role for one person or part of a larger team’s responsibilities. The manager may work in-house as an employee or be an agency contractor.
What Is ROI?
Return on investment (ROI) is a way to measure whether an expenditure of money, effort or resources was worthwhile based on the value you got out of it in return. A positive ROI means you “made” more than you invested, while a negative ROI signals a net loss.
To calculate ROI, you take the total value of returns and divide it by the amount invested upfront. For example, let’s say you started a small lawn mowing business last summer:
– You spent $500 on lawn equipment upfront (your investment)
– Over the summer, you earned $2000 in revenue from customers
To calculate ROI:
1. Find your net profit by subtracting investment from revenue:
$2000 – $500 = $1500
2. Divide net profit by investment:
$1500 / $500 = 3
3. Convert to a percentage:
3 x 100% = 300% ROI
Since your ROI came out as a positive 300%, that means for every $1 invested into lawn equipment, you got back $3 in return. Not a bad ROI at all!
The ROI of a Social Media Manager
Calculating ROI gets trickier when your investment isn’t purely a equipment purchase that directly generates revenue. Unlike lawn mowing, social media mgartting doesn’t necessarily spit out dollars directly back into your pocket.
There are some more indirect “returns” a skilled social media professional can generate like:
– Brand awareness, authority and reputation-building
– More website traffic and lead generation
– Increased customer engagement and loyalty
– Improved search rankings from consistent posting
– New sales from promotional campaigns and shoutouts
All of those intangible assets can ultimately lead to higher sales and revenues down the line. But it’s harder to pin an exact dollar figure on what each new Instagram follower or Facebook post is inherently worth.
That said, here are some of the common ways to estimate a social media manager’s ROI potential:
New Lead Generation and Conversion Rates
An important metric is looking at how social media management impacts lead generation and conversion rates versus paid advertising costs. For example, if running social media ads drove 1000 new email sign ups and it cost $5000, each new lead cost $5 on average.
Customer Acquisition Costs
Along those same lines, you can look at new customers gained over a period versus total social media staffing, software, advertising and management costs to calculate a customer acquisition cost average. The lower that cost per new customer, the higher the ROI.
Direct Sales Revenue Attribution
Ecommerce brands or companies running direct paid campaigns on social media may be able to clearly attribute sales revenues to successful social media promotion efforts. If a targeted social media campaign directly drove $100,000 in new sales and only cost $20,000 to produce and promote, that’s a 5X ROI.
Customer Lifetime Value Projections
Quality social media managers delivering strong audience engagement and retention should factor in potential lifetime values of new customers gained. Even if acquisition costs are a bit higher initially, it can absolutely be worth it if those customers stick around and make repeat purchases long-term.
Brand Building Impacts on Overall Revenue
At the highest level, you may simply look at a company’s overall revenue and growth trajectory before and after implementing dedicated social media resources. If year-over-year sales numbers start climbing more substantially following an investment in professional management, you could attribute at least a portion of those gains as ROI.
What Good Social Media ROI Looks Like
It’s tough to put firm numbers on what qualifies as a “good” or “bad” ROI to expect from a social media manager. Every industry, business goals, and resources will be a bit different.
However, here are some benchmark examples that generally illustrate a solid ROI for the average small business budget:
– Generating at least 2X in new sales pipelines versus annual social media staffing/management costs
– Acquiring new customers at an average cost under $500 each through social media efforts
– Boosting overall website traffic by 25%+ year-over-year
– Increasing email list size and subscriber values by double digits annually
– Earning millions of brand impressions, views, and reach from successful campaigns
– Achieving above 10-15% engagement rates across most posts
If you have a smaller personal brand or solo business, your targets and “good” ROI thresholds may be lower. But at larger company scale, strong social media ROI can equate to hundreds of thousands (or millions) in new sales impact per manager.
Maximizing ROI From Social Media Management
Obviously, the ROI you’ll experience from investing in social media management depends heavily on the talent, skills and strategic execution of whoever is running point on those efforts. To ensure you maximize returns, keep these tips in mind:
Set Measurable Goals and KPIs
Don’t just post for the sake of posting. Establish clear, measurable targets for what you want to achieve like engagement rates, audience growth, web traffic sources and conversions. These goals keep efforts focused.
Create a Consistent Content Strategy
One of the biggest roles of a social media manager should be developing a cohesive, intentional content strategy around themes and pillars that resonate with your audience. Consistency breeds maximim engagement and compounding returns.
Focus on Quality Over Quantity
Don’t spread efforts too thin trying to dominate every social platform. Concentrate on prioritizing 2-3 primary channels and creating exceptionally high-quality, polished content optimized for those platforms. Quality stands out.
Prioritize Video and Visuals
Video and other media-rich visuals consistently earn higher engagement and messaging retention compared to text-only posts. A great social media manager should be skilled at compelling video/photo creation.
Embrace Influencers and Creators
Partnering with relevant influencers and creators who have highly engaged audiences in your niche is often an extremely cost-effective way to amplify message reach and ROI beyond your own account’s following limits.
Lean Into Paid Promotions
While it’s possible to grow organically over time, often the highest ROIs come from incorporating paid social advertising, boosting and promotional budgets that get your content in front of hyper-targeted audiences.
Get Serious About Analytics
From day one, a skilled social media professional should exhaustively track every available metric around posting performance, audience behavior, traffic sources, conversion rates and more to identify optimization opportunities.
Embrace Iterative Testing
Social media trends, features and algorithms are constantly evolving. A great manager embraces ongoing experimentation to iteratively test new tactics, creative approaches, audience targeting and more instead of getting stale.
Align With Larger Marketing Efforts
To maximize ROI impact, social media efforts should connect and integrate with larger brand marketing, funnel building, SEO, email campaigns and other initiatives. It’s most powerful as just one cohesive piece of a complete strategy.
Is a Social Media Manager Worth the Investment?
When weighing the ROI of bringing on a dedicated social media manager, the simple truth is the potential returns can be incredibly high for businesses that do it right. But “doing it right” is the operative phrase.
Having a gifted social media professional with strong strategic, creative, communication and analytical skills can be an absolute game-changer in terms of:
– Amplifying brand reputation and industry authority
– Generating exponentially more leads and warm prospects
– Moving customers through the funnel with engagement
– Delivering higher web traffic and conversion rates
– Boosting overall revenues from coordinated marketing
However, if your social media manager approaches their role as simply scheduling posts and churning out random content without an intentional strategy and process? You’re probably better off not investing in that overhead and instead focusing budget into other ROI-positive marketing channels.
The businesses getting true, impressive ROI on their social media management hires are the ones maximizing their talent and making social media a cohesive, central component of revenue and growth efforts on multiple fronts.
So if you’re willing to make that full commitment in resources, process and talent to turn social media into a serious business driver, the ROI can absolutely be there. If it’s viewed as just a casual aside for random meme postings and collecting likes? That’s where lackluster returns will likely disappoint versus the level of investment required.