Restaurants and Social Media? Is it just a Hype or is there a real ROI?
Can social media get a positive Return on Investment (ROI) for your restaurant? YES, Definitely, social media can produce a healthy ROI. BUT then, not always.
As in any other form of marketing, ROI in social media depends on a hoard of factors, including and primarily, the target audience with whom you would engage, interact and possibly convert as well.
In this article, we shall talk about social media marketing that makes the most sense for a restaurant and how to optimise the efforts that are put in to get a positive ROI.
Wait, firstly, what is Social Media ROI?
ROI is basically a measure of your income to your expenditure. Social Media ROI is a measure of the income generated for you through social media to your expenditure.
When you talk of expenditure, don’t just include the money, but also include the time and the efforts put in. But, how can they be quantified? We shall talk more about it later in the article.
The Right Audience at the Right Platform
First off, determine who needs to see your Ads, whom you want to reach out to and engage, in the hope of further conversions.
Classify your audience into two basic categories:
- The current loyal audience, that you should reach out to, so as to drive in repeated walk ins
- An entirely new segment of people who haven’t checked you out yet.
Are you a Pizzeria, looking to appeal to a younger crowd, or a fine dining restaurant looking to reach out to the older audience?
Are you a brewery looking to tap in to the middle aged, middle income guys?
Consider your job half done once you’ve classified your audience and segmented them thoroughly. Next step is to ask yourself: “Where would you find these guys?”
Generally, the younger crowd in India “lives on” Facebook & Instagram primarily, while the elder crowd are restricted more to Facebook yet.
But platforms like Twitter and Google plus do have a good number of users and that must be kept in mind before further strategising.
Mind you, if you speak to the wrong audience or on the wrong platform on social media, you’re just wasting your time and of course, Money! Trying to increase your engagement would then only seem harder & frustrating.
The Right Guy!
Finding the right guy, like in many other aspects of life, is of utmost importance in social media as well. You would need someone who’s thorough knowledge and experience of your restaurant and of the social media platforms, to handle your social media.
Your social media go-to guy has to be able to articulate his thoughts clearly and communicate well with good graphic designs & content.
At the end of the day, you don’t want to use social media as just another cool timepass thing, but rather, to as a tool to grow your business.
This guy has to be accountable for your social media ROI and therefore, take time, but choose well.
You could either hire pay more and hire a guy who would need another designer/content writer or hire a digital marketing agency, with good experience in the field.
Measuring Social Media ROI
Here are the 6 steps to ensure that we are getting a positive return on investment from our social media efforts:
1. Be specific and have measurable goals
First of all, you need to understand that just a small percentage of the people who follow you on social media or who see your Ad, would actually buy from you.
But in order for you to know what that percentage is and to grow it, you need to track your results and analyse them consistently.
Most of the time a regular industry standard is about 10% of followers who would become your customers, this percentage can be increased but in order to do so you need to know these 3 things:
– Number of total clicks on your Ad
– Number of unique clicks on your Ad
– Actions taken (Such as orders put in or tables reserved online)
These are some of the actions to be tracked online. There are also ways to track your progress offline:
– Call phone to reserve or order (provide a special code to mention)
– Small surveys with the check (always asking “Where did you hear from us?”)
– Redeemable coupons or promos the user has to print out or show on their phone.
2. Track the conversions
Talking strictly about the online aspect now, because you can’t see peoples faces or talk to them on social media, how do we determine the best course of action?
To track your conversions online and be able to measure the numbers we discussed earlier you need to have a Tracking service in place.
Run every link you share on social media through the tracker and install a “tracking pixel” on your website to monitor activity on it.
With this, you will be able to see what ads get clicked on the most, how many people actually order or reserve tables and how many people end up leaving.
With this data, you can see if you need to do more of the same or change your strategy to increase your percentages, at the end of the day online marketing is all about experimenting and split testing.
So make sure you know your numbers so you can get the most social media ROI.
3. Determine how valuable each conversion is to you
Another super important number to track is the lifetime value of your customer.
If you know the average bill per table is, say, INR 300 and they tend to come back twice on an average each month and it costs you INR 50 to acquire that customer then your customer is worth INR 550!
Of course, this is before food, labor and other costs. But you can see that much like placing a price on a dish, marketing and particularly social media marketing, needs to always make sense to your business on the money side to make sure you get a healthy ROI.
4. Keep a close watch on revenues from each platform and channels
Since social media marketing is more effective when you’re in multiple channels, it’s important to be aware of how each of the platforms is performing.
You would also need to run multiple ad campaigns to get in traction, and so it is important to keep an eye on each campaign consistently.
For example, if your Instagram is getting in a lot of engagement from your right target audience, but your Facebook page isn’t (either it isn’t getting in any engagement or the ‘wrong’ people are engaged there), it’s better to focus your time, efforts and more importantly, Money, on Instagram.
Also, if you find an Ad Campaign to get in more page likes and to increase the reach of your page, not resulting in more post engagements or conversions, stop it and focus on what’s working.
Figure out what your audience responds to best and do more of that.
5. Now calculate your return on investment (ROI)
It all needs to make sense from the business stand point.
Factor in what you’re spending on marketing to acquire customers, then divide that by the number of customers who were actually generated through your social media marketing.
Then factor in how much money do those customers represent and subtract your marketing costs and you have got your ROI.
If you are not spending money on ads or social media experts you should then factor in the hours you or your employees devote to social media and how much does it cost you. You should be able to determine a number from the numbers of hours spent and awarding a sum of money per hour, depending on the monthly salaries paid in the field in your area.
If you are using a social media marketing service, it’s easier to figure out the costs, as they come with monthly reports.
6. Optimise the channels that provide the most ROI
Once you calculate your ROI, you would need to figure out which Ad campaigns and platforms work better than others. You would have to optimise your Ads accordingly, so that you can increase your numbers.
Social media is all about conversion through engagement. If you give people good content, content they can relate with, content that they like and would love to share, your numbers and ROI would go up with ease.
If you feel that the response is low, or that the conversions are fewer, you would need to recheck once again. Compare your social media ROI to other channels in your restaurant marketing campaigns, like banners or magazine Ads and determine if your social media needs optimising or not!
Here’s what not to do:
When it comes to social media you need to give value, value, value and then a pitch. If all you post all day are pitches such as lunch specials, offers, or new dishes’ promotions, people would soon stop responding to your posts and your social media efforts would produce diminishing returns.
People want to be either informed or entertained. If you can keep people informed and entertained you will always succeed.
A good rule of thumb is to always make your posts 80% value through engaging content and 20% pitches.
Having said that, keep in mind not to give in value and not to have a sales pitch, as then you would end up with a lot of fans but with no conversions.