Demonstrating Return on Investment (ROI) is challenging for many marketers. Executives are demanding more accountability from marketing: What, exactly, are we getting for all this money we spend on marketing?
At the same time, marketing is complex, the buying cycle is long, and prospects typically interact with your company and content multiple times through multiple channels before making a purchasing decision. That can make it hard to measure ROI.
There are times when simplifying your approach to ROI can be helpful. You may not be able to measure everything, and some uncertainty may remain, but taking a simplified approach to ROI can still provide actionable insight and justify your marketing spend.
Start With Your Marketing Goals
Before you can start calculating ROI, you have to decide what to measure. The metrics available today to digital marketers are legion, since every click, view, open, forward, share, comment, and more can be captured.
How to choose which ones are important? Start with your marketing goals. The most common marketing goal for industrial marketers is lead generation, followed by brand awareness. But you might want to get more specific than that. To generate a single lead, a lot of touches—and therefore metrics—can be involved. Same with brand awareness: many metrics can contribute to its measurement.
Within lead generation, your goals could be to increase long-term leads for nurturing campaigns, or marketing qualified leads or sales-ready leads. Within brand awareness, a goal might be to increase subscribers or followers, or website traffic. You might have multiple goals. But if you’re new to ROI or struggling to get a handle on it, try focusing your efforts on one or two important marketing goals.
These Metrics Are Always Relevant
Whatever your marketing goals, certain metrics always make sense to track and are solid inputs for calculating ROI.
Website traffic—Your website is your company’s face to the market and your primary channel for attracting, educating, and converting potential prospects. Free Google Analytics is your source for the data.
New vs. returning visitors give a sense of how well you are reaching a new audience compared to keeping your current one. Other metrics within website traffic include page popularity, entrance pages, time on page, and exit pages.
If brand awareness is a goal, upward ticks in web traffic metrics are a good sign.
Conversions per activity—Getting visitors to your website is one thing, converting them is another and is essential to lead generation goals. Use forms completed on landing pages and content accessed to measure conversions.
Marketing qualified leads—You might generate a lot of leads, but how good are those leads? Many marketers using a scoring system to rank the quality of leads. What goes into the score is individual to each company, but common inputs include how closely a prospect resembles your current customers, the number of times they interact with your company, their industry/location, and their expressed buying timeframe. A marketing qualified lead can be tied to a specific campaign or come about as the result of a prospect interacting with multiple campaigns.
Engagement—This metric helps you understand how good your content is and how prospects respond to your marketing messages. Engagement is measured by clicks, shares, comments, likes, forward, mentions, and other purposeful activities on the part of your prospect. It can help you measure ROI on branding efforts as well as the value of your content.
Cost per lead—Most prospects who become leads will have multiple interactions with your company, so it can be challenging to attribute a single program and its associated costs to any given lead. What you can do is take your total marketing program costs, divide by the number of leads and get an overall cost per lead. But if you want to drill down to see which programs and efforts contribute most to lead generation, we recommend marketing automation.
Marketing Automation Makes Measurement Easier
With multiple marketing channels, so much content, and often a long sales process, it can be challenging to determine what influenced the lead’s desire to buy.
Marketing automation makes this process much easier. It allows you to track prospect activity across different channels and programs. You can also nurture leads with scheduled marketing touches and content throughout their buying journey.
You will be able to see all of the ways a prospect has interacted with your company, content, channels, and programs. You can get answers to the questions of what content they downloaded, what pages they visited, what social media they interacted with. You won’t run the risk of attributing a lead or a sale to only one program if several programs contributed to the outcome—which is a common occurrence.
There are free and low-cost marketing automation solutions on the market today. If you want to simplify ROI, take advantage of the technology and tools out there to help you.