This FAQ and Glossary helps you to understand how the Social Media Calculator is working.
We multiply the reach with a platform multiplier.
For our calculation model, we take historical ad data from different social media platforms. We calculate a median of the cost per 1,000 impressions (CPM) and divide it by 1,000. For YouTube we take the cost per view (CPV) In the end we have the cost to reach 1 impression. This is our platform-specific multiplier. For example, you have to spend $ 0,05 to reach 1 impression on Facebook.
But there is a big difference between one person who saw your post and a person who interacted with your post. Interactions are more valuable. This is why we decided to combine the CPM with a qualitative factor – the interactions.
Engagement includes in our model likes, comments, and shares. If you take all engagements and divide them by reach, you will get the engagement rate.
In our model, we weight the different interactions: Like=1x; Comments=2x, Shares=3x. Then we get a so-called "weighted Engagement Rate". Is this rate over the benchmark, the platform multiplier will increase. Is the rate under the benchmark, the multiplier will fall. So all in all, the engagement can change the multiplier and in the end the social media value.
Some other tools are only working with the number of fans and the average engagement rate. We think this assumption does not address this issue in its entirety. In particular because social networks regularly change their algorithms and therefore you need more valid data. The only valid data are the insight data (reach and/or impressions).
Our Social Media Value is just an monetary express equivalent for a public relations value. It shows how much an advertising would have cost instead of an organic social media post. The Social Media Value does not consider a return. Furthermore, a ROI is working with goals and with your own invest. All these things are not part of the Social Media Value.