I love social media. I love the pace. I love that it’s always changing. Despite our lack of true understanding of the return on investment for TV, print, radio and other “established” channels, we demand an immediate RETURN ON INVESTMENT from social media. I want a return. I want to know that the ideas we bring forward drive our business.

But, I often think we’re all asking the wrong question. The question shouldn’t be, what the return on investment. No. The question should be, WHAT’S THE VALUE PER CONNECTION. Think on that for just a second. I’m not looking to duck the ROI question. Quite the opposite, actually. Here’s why I think you need to reconsider the question about ROI. “What’s the return on investment?” That question only addresses a short term business challenge. It provides you with a data point to help you understand how much immediate value you generated relative to the investment (usually dollars) made into the “program.” Now, I say program, because generally the ROI question comes up when we execute a program, an initiative, a campaign or something else that’s short term.

The key word here is investment. But, aren’t investment supposed to be long term? One of the first rules of basic financial investing is that you maximize your return over the long haul, not through quick short term trading. There are simply too many penalties involved with short term trades. Similar penalties exist when you evaluate social media through the lens of return on investment.

I like to think about long term return on investment, not short term. To get to long term return on investment, you need to shift your thinking and ask the question, what’s the value per connection. Return on investment is an evaluation of the moment. Your value changes over time. Doesn’t it? As your life changes your value changes. Value is not fixed; it’s ever changing.

Let me break this down for a second. Let’s assume you run a $100K Facebook ad campaign focused on generating incremental likes. During the campaign you generated 50K new likes. One of those likes was Lisa Smith. Well, the ROI on Lisa would normally we calculated by taking the investment of $100K divided by the return (total likes) which equals $2.00. So Lisa is worth $2.00. Is that fair? Is that accurate? I don’t think so. If Lisa spends $10.00 more this month than she does normally does, isn’t her value now $10.00? If her liking your page, convinces 5 more of her friends to like your page….well, isn’t she now worth more than $2.00? I could go on an and on about all the different ways to consider someone’s value.

Value, is more complex than return. Maybe that’s why so many of us avoid thinking about it, focusing on it or solving for it. Thinking short term is easy. We could formulize ROI model after model. That’s easy. Asking what the value per connection is, that’s much more challenging, but it’s the right question.