by Govind Davis, CEO Agilcore
Does it make sense to keep doing the same things over and over without even knowing the results? Most people will agree, that’s no way to run a business. Despite common sense, that’s what a lot of companies are doing when they pursue their marketing activities without being able to measure or prove Return on Investment (ROI). While the importance of tracking and proving ROI is clear, proving inbound ROI may not always be so simple. In fact, year over year it ranks among the top challenges for marketers and businesses.
A recent survey showed that 43% of marketing and business teams find it challenging to track inbound ROI marketing, although some of this could be contributed to a lack of focus on ROI, to begin with. Setting up analytics, reporting, and strategy to assess the ROI of your business efforts takes time. And if there is anything in short supply in most businesses, it is time. Many companies struggle with marketing ROI due to the following reasons:
- The process seems overwhelming when you consider all the channels, content and agencies that support marketing efforts.
- Data and Tools. How will you collect the data and what tools do you need to get the job done?
- Analytics, Coding, Finance, Accounting are not the strongest skill sets for many businesses.
- What’s the best or easiest way to calculate ROI for your business? Can your business answer the question, “What’s the ROI of your marketing?” The answer is as simple as measuring revenue generated from marketing activities, less the investment you made to generate that revenue and divided by the investment.
According to the calculation, if your business model can focus either on getting more results from your marketing budget or get the same results with less of a budget, this, in the end, will increase a business’s ROI. The best way to demonstrate marketing ROI is to stick to programs you can measure. What’s the ROI of logos on a famous golfer’s hat? No idea because it is not measurable or calculated.
Other marketing efforts are trackable like digital advertising, PPC and SEO. Another marker to watch is the upswing in customers to your website or the open rate of the last email campaign. These are all measurable and over time and with the right tools in place, you can measure, analyze and track many different points of data just through a few simple pre-empted marketing initiatives.
ROI is not a perfect science for marketing. The biggest challenge is committing to measure it in the first place. Then use it to make budget and investment decisions. Because the “investment” part of the equation is so important, just stopping the marketing activities that don’t provide a measurable return is often the easiest way to improve your marketing ROI. Then invest that newly “found” money into content marketing and other digital programs you can measure, analyze and optimize.
Govind Davis is the CEO of Agilcore and RSO Consulting. RSO Consulting has a strategy around measuring ROI and creating a game-plan for all types of business marketing needs. Now ready to help in the Reno Nevada area.
