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Social media. It’s a minefield of data. From likes to shares, pins to loves, celebrations, dislikes, retweets … the sheer number of metrics is overwhelming.

But every “like”, “comment”, “share” or “retweet” is a sign of how good your social media marketing is and evidence of a high return on investment, isn’t it? Well no Not after the C suite.

The board is becoming increasingly frustrated with meaningless metrics that don’t help meet business goals or generate revenue, and that affect perceptions of the value of digital marketing in general.

Meaningless metrics

The hard truth is that likes, shares, and engagement rates don’t matter to the board. In the Bango Board to Death survey, 76% of chief executive officers (CEOs) said they didn’t care about retweets, 65% didn’t care about likes, and 76% said they didn’t care about impressions.

Almost half (42% and 40%, respectively) of the CEOs surveyed saw generating new customers and increasing profits as the most important goals of marketing. Even so, 59% said that social channels do not generate sales for their business, and 77% do not see digital advertising as a reliable source of new customers or sales.

Obviously, social media marketing can’t prove to the people who matter that it’s worth it. And since 62% of CEOs believe that too much marketing budget is wasted on activities that don’t produce meaningful results, it’s time for marketers to rethink their social media marketing strategies.

But the good news is that this doesn’t mean giving up social media entirely.

Why isn’t social media success generating revenue?

Social media marketing campaigns can add value, but only if they are targeted at people who actually want to buy your product.

Most social media campaigns run on platforms like Facebook, Instagram, and LinkedIn are based on information like age, occupation, gender, preferences, and even search terms.

While this information provides insight into the kinds of things certain sections of the population are interested in, it is not a big enough indicator of purchase intent. As a result, social media conversion rates are shockingly low.

For example, Instagram’s conversion rate is 1% and that of Twitter and Pinterest is 0.77% and 0.54%, respectively. Facebook trade shows are better depending on the industry. The fitness industry has the highest conversion rate with a little more than 14% and the highest conversion rate with a little more than 13%. In the tech industry, however, the average conversion rate is a grim 2.31%.

With conversion rates rarely in the double digits, it’s no wonder marketers use engagement metrics to justify their activities. With 77% of CEOs expecting marketing to have a measurable impact on bottom line, engagement rates won’t go up.

However, if marketers can show that their activities are more directly targeted to those who buy, 71% of CEOs say they would increase the budget of their marketing departments.

So the question is: How can digital marketers ensure that their social media activities are having a positive impact on sales?

It’s simple … buying behavior targeting.

What is buying behavior targeting?

Buying behavior targeting is a digital marketing revolution and one of the industry’s best-kept secrets. Rather than targeting a specific gender, age group, or occupation, marketers can target campaigns to people who have spent their money on similar products and are therefore more likely to buy them again.

It eliminates the “guessing” element of social media marketing and allows marketers to target campaigns directly to those who are most likely to buy the product. No more convincing stakeholders of the benefits of high engagement or click rates – just high conversion rates and more paying customers.

What does this mean for the future of social media marketing?

Buying behavior targeting is not a new concept. In fact, Facebook has been offering first-party payment data for years to support the buying behavior of campaigns on its platform.

As with all targeting data, it’s the be-all and end-all, and the limitations of using only first-party data meant that this form of segmentation of demographics never really got off the ground.

With a number of new tools offered by e-commerce providers that analyze third-party data and billing information from billions of pounds of consumer spending on major consumer platforms, marketers can more effectively target campaigns and segment their ads only to customers with the highest likelihood of getting a Product to buy

As these emerging platforms become more popular, marketers can expect increased conversion rates and their impact on bottom line results. In the meantime, CEOs can breathe a sigh of relief that they no longer need to hear about the benefits of a like and can be faced with meaningful results and a high ROI on their social media marketing spend.

By Anil Malhotra, CMO of Bango