Calculating the ROI of social networks is not rocket science

social media

COMMENT: Chances are your enterprise has, to some degree or other, engaged with social networking during the last couple of years.

The question being asked by both those businesses who have already done so, and are considering coming late to the social network party, is "How do I calculate the return on investment?" No, seriously, I am told by a company that has just launched an Enterprise Social Software ROI Calculator that businesses are striving to clarify the benefits that can be expected from "driving higher collaboration and communication among organisations and workgroups" when it comes to the savings that can be realised by implementing an enterprise social networking strategy.

Although there is quite some danger that I might need some kind of tool to help me calculate what that actually means, I shall stick with it and try to discover the real truth of the social networking ROI equation for the enterprise.

blueKiwi, the company launching that ROI calculator tool, accepts that social networking is an integral part of our lives as individuals while suggesting that anecdotal evidence of how the same social networking concept can reshape employee engagement with each other and externally with partner organisations and customers isn't enough.

I'm not sure that I agree. The evidence is actually right there in front of us that a culture of sharing and collaboration is fostered within the social networking environment, and it doesn't actually take a rocket scientist to make the connection between improving how your business communicates with its partners and customers and improving sales figures or, indeed, how improving communication and collaboration between employees (at all levels) will improve productivity. That's kind of Business Smarts 101 stuff, innit?

Jean-Luc Valente, the blueKiwi CEO, suggests that the calculator tool and accompanying white paper can help enterprises assess return on value (behavioural changes through sharing and social linking enabling a flatter structure and breaking traditional organisational silos) and return on productivity (through that improvement in communication and collaboration of which I just spoke, leading to more effective time management).

This is all very interesting, and valid within the context of a purpose-built platform for building enterprise social networks such as that offered by, unsurprisingly, blueWiki itself. But what about stepping even further outside of the corporate mind-set box and thinking about open social networks such as Facebook and Twitter for example; how do you even start to calculate the ROI of those?

Again, I reckon it's more simple than many would have you believe. I am no maths genius, in fact far from it, but the basic ROI equation would look something like this: Strategy + Security = Profit. The strategy part is simple, decide what you want to get out of your social networking experience and produce a plan like any other marketing exercise in order to achieve it.

The security part is a little more problematical, with 91 per cent of organisations apparently so concerned about it that they are actively postponing any adoption of an official social networking strategy. Yet it's actually pretty easy to avoid falling into the security pitfalls that will send you into ROI negative equity territory. I recently wrote a guide to securing social media for business for our sister publication PC Pro, which can be summed up as defining what is acceptable use, ensuring those boundaries are enforced and adapting existing security methods to include protection against specific social media threats.

If you know what you are using social media for, if you have clear business goals that you want to achieve, then it's pretty easy to spot if they are being met or not. Your ROI will be negatively impacted if you do not take social media security seriously enough as any good that you achieve could be undone by a thoughtless comment or careless click. Not taking security seriously enough is as bad as just adopting a social networking model because everyone else is, but without any clear understanding of what you hope to get out of it.

However, at the end of the day it's less about trying to work out if you can afford to enter the world of social networking for business, and more if you can afford not to when your competitors in an ever-shrinking global marketplace are being more confident in doing so.

Davey Winder

Davey is a three-decade veteran technology journalist specialising in cybersecurity and privacy matters and has been a Contributing Editor at PC Pro magazine since the first issue was published in 1994. He's also a Senior Contributor at Forbes, and co-founder of the Forbes Straight Talking Cyber video project that won the ‘Most Educational Content’ category at the 2021 European Cybersecurity Blogger Awards.

Davey has also picked up many other awards over the years, including the Security Serious ‘Cyber Writer of the Year’ title in 2020. As well as being the only three-time winner of the BT Security Journalist of the Year award (2006, 2008, 2010) Davey was also named BT Technology Journalist of the Year in 1996 for a forward-looking feature in PC Pro Magazine called ‘Threats to the Internet.’ In 2011 he was honoured with the Enigma Award for a lifetime contribution to IT security journalism which, thankfully, didn’t end his ongoing contributions - or his life for that matter.

You can follow Davey on Twitter @happygeek, or email him at