What social media ROI measures
Return on investment (ROI) compares what social media earned with what it cost. A result of 100% means you earned back twice what you spent; 0% means you broke even; below 0 means it cost more than it brought in. The formula is the same everywhere: (revenue − total cost) ÷ total cost × 100.
The formula is the easy part. The two inputs are where most ROI numbers go wrong: revenue that is not really from social media, and costs that leave out the time people spent.
Counting the revenue
Only count revenue you can trace. Tag the links in your posts, bios and ads with UTM parameters, then read the revenue per source and campaign in your analytics or shop. For leads that close later, use the value your sales team assigns to a lead, and say so in your report.
Counting the costs
Add every cost from the same period: ad spend, tool subscriptions, content production, freelancers and the hours your team spent, valued at what an hour costs you. The breakdown shows which cost takes the largest share, which is often time rather than ads.
Make it a habit
Work out ROI for the same period length every time, with the same rules for revenue and costs, so the trend means something. PostBoost analytics shows reach and engagement for your connected accounts in one place, next to the revenue side you measure with UTM links.