How to quantify the ROI of social media to your CFO

[shaownhasan]

Even having an open conversation about prioritizing short-term goals or managing a volatile economy is valuable and important.

You might have to recognize that it’s a tough market right now, so you will pull back on this investment that’s less directly attributable to revenue. But you will come back in six months because we need to get this back on the table, otherwise, we’re going to have a hard time in 2024 or 2025.

Be realistic when you know something isn’t going to have a direct impact, but be confident about making the investment at a later date.

Maximizing the impact social media can have on an organization botim data requires investments in people and the tools. When presenting these line items to your CFO, you need to be prepared with an airtight, data-driven case.

Present cost savings
Pinpoint and present how a new approach to social media management can cut costs for the bottom line. Whenever it’s time for our executive team to begin annual planning and review budgets, I try to identify cost savings that will benefit both the marketing organization and the business as a whole.

I will also bring productivity savings to our CFO. I may say, “With this investment, it’s going to save my team 50 hours a month that we can dedicate to other areas that we weren’t able to reach before.”

For example, we recently commissioned a Total Economic Impact™ study conducted by Forrester Consulting which found that Sprout drove $973,000 in productivity and efficiency over three years for a composite organization. Over that same time period, brands were also able to eliminate manual data aggregation for monthly reports by 75%—giving social teams more time to act on insights rather than compile them.

Presenting potential cuts and productivity savings like these show you understand the full business perspective, not just the marketing perspective, of your spend.

Marketing tech stacks are always under scrutiny, especially if there are many solutions under a budget. Proposing investments that consolidate or simplify your existing stack can help demonstrate the value of a new solution.