Measurement of social media ROI is one of the biggest issues currently facing social media and online marketing professionals.  Senior managers and financial bean counters want to be able to assign a financial return on your efforts, which is understandable enough.  After all, a business is a business and it exists to make money.

The rather intangible nature of social media engagement however makes measuring ROI somewhat difficult.  The various metrics that are typically used to determine ROI all have their flaws.

For instance base metrics such as visitors to your website or the number of Twitter followers are often used as headline grabbers, but they don't really tell you much about the success of your social media work.

More financial metrics such as direct revenue and qualified leads are also far from ideal.  Many will argue that social media work comes much earlier in the buying process, especially for B2B customers where the buying process is so long.  Such evaluation would also rely upon the last click wins approach, which is widely regarded as far from ideal in attributing a sale to a particular source.

I don't want to talk about those things however.  Instead I want to talk about how setting hard finance focused ROIs can affect how you do things.  There's a whole heap of research out there showing that big brands are generally stinking the place out on social media.  Many of them focus too much on overtly advertising to people, and as a result engagement levels are pretty poor.  

Do they do that because they have to provide a financial justification for what they do?  It would seem possible to me.  Now I should state that I'm not against measuring things and don't advocate operating on gut instinct alone.  You're not a Jedi after all, just be careful not to let the tail wag the dog.  If you engage with customers in the right way via social media then financial returns will inevitably follow.  If you chase a quick buck however it's a sure fire way of alienating your customers and ensuring you don't achieve what you could do with social media.