Gary Vaynerchuk doesn’t mince words when he talks about social media ROI. He’s been quite vocal in telling us the calculating the ROI for social media is like trying to assign an ROI to your mom.

That’s a good line, but leaves us wondering how to figure what works. In this video clip, Gary gives us some further insights:

Are You Ready for Social Media ROI?

I agree that it’s going to be a while before everyone sees where the ROI is in their social media investments. However, that doesn’t mean we can sit back and wait. Smart businesses are using the data being generated now to measure what they can and learning that the online models of business established during the last decade are just one way to measure. There’s still a lot of value in using the click to¬†transaction metrics to see immediate boost in sales.

Always nice to spend X and see a multiple of that in the cash register the same day. That’s one KPI (key performance indicator) that every business should know and measure. In a sales funnel, the bottom of the funnel where the money comes out is the heart of your business.

What we’re learning now is how to set KPI’s to measure the much larger volume of data (people) that are at the top of the funnel. Your prospects and those thinking about ¬†you that haven’t got to a Google search.The mass media approach of the 20th Century was aimed at hitting everyone in the funnel, and everyone else. We’d blast a message to everyone and expect a very small percentage to buy and provide us with sales and profits.

Modern audience are so overwhelmed with messages that they have learned to tune out nearly everything. New technology filters out many messages and the default reaction becomes to yell louder. That does not work if you message is getting filtered.. if anything, it makes the message easier to filter.

Social media ROI comes from two way communication, which means listening to the audience and responding to those who are seeking information, especially at the top of the funnel. Do this and you will stand out far more than anyone yelling “buy me”