Should ROI Be Attached to Every Marketing Activity? Here's a three step plan to help you apply the right set of tools and data-mining strategies to get the most out of your ROI measurement plan.
Opinions expressed by Entrepreneur contributors are their own.
Every now and then, I hear "You can't measure the ROI of _______." You can fill in the blank with engagement, responsiveness and so on.
However, when it comes to marketing, especially in a digital world, we should be putting more focus on asking: Can we put an ROI on what we do as marketers? Whether audience building, customer service on social or campaigns and promotions, we need to closely track all our marketing activities.
ROI measurement: more hassle than help?
While I do believe that trying to seek out a specific ROI on every single activity can become exhausting and demoralizing for most marketers, it's true that marketing (as a whole) can and should be able to attribute ROI to many activities. I know this is a sore subject for many marketers for more than one reason. First, it's easy to get mired in the complex web of tools and techniques for measuring ROI. Secondly, with mountains of data and statistics available, today's marketers have more insights on their fingertips than ever before. Which in itself can be an issue, as finding meaningful information from these unending data streams is basically like trying to find a needle in a haystack.
Despite these challenges, there are now ways to place value and ROI on most of our marketing activities.
Here are a few steps that will help you tie ROI with your marketing efforts.
Your ROI measurement plan
An ROI measurement plan can be divided into a three-step strategy to help you measure the ROI of your marketing efforts right from the top of the conversion funnel, to the middle and down to thebottom.
Top of the funnel: This is where you should analyze your investment in growing engaged and relevant audiences for your brand. Some key metrics you should apply at this stage include: organic search traffic, organic keyword rankings, paid search traffic, paid search cost-per-click, paid search cost referral traffic, direct traffic, social app traffic and organic and paid social-media traffic.
Middle of the funnel: At this stage, you should be tracking your investment in growth of qualified leads. That is, leads that show interest in the products or services you offer and consequently are more likely to become customers. The metrics you need to watch out for include: click on call-to-actions, click on landing pages and click to submission ratio on landing pages. With the help of these data sets, you can build better strategies to drive submissions and lead generation.
Bottom of the funnel: Here, you need to monitor your investment in activities pertaining to the growth of sales conversions. Consider metrics such as lead volume, marketing qualified leads, sales qualified leads and various conversion ratios like leads to proposals ratio, as well as proposal to close ratio.
Besides these three stages, there are a few other areas that need continuous tracking and monitoring to demonstrate how they add to the bottom line of your marketing activities. For instance, measuring the returns on investment in customer retention and community building should be an ongoing process.
However, it's equally important to apply the right set of tools and data-mining strategies to get the most out of your measurement plan. Calculating every inch of what's measurable reveals the true value of every one of your marketing efforts. This ensures no unpleasant surprises, and helps you succeed in all of your future marketing efforts.