Return On Investment Digital Marketing


The Top 10 Advertising Roi Metrics

Social Media RETURN ON INVESTMENT| Social media ROI |Social Media ROI MEASUREMENT, digital marketing

In this guide, well cover how to measure ROI on marketing spend using these 10-key digital marketing measurement metrics. Tactics vary when it comes to campaign ROI calculation, so understanding these marketing ROI metrics is a smart place to start.

Well tell you about the benefits and limitations of each metric and how they can contribute to the calculation of ROI in marketing.

Digital Marketing Roi By Tactic

Sophisticated marketers go beyond general metrics to measure digital marketing ROI by tactic. That way, you can figure out what digital marketing tactics work best and focus your resources on the most efficient activities. Below is a list of some of the most common and useful tactical digital marketing ROI metrics.

  • Email Metrics: Open rate, link click-through rate, bounce/undeliverable rate, unsubscribe rate, conversions, and number of leads acquired.
  • Social Media:Number of likes, comments, and shares, fans/followers, clicks, conversions, and leads acquired.
  • Squeeze and Landing Pages: Number of unique visitors, returning visitors, page views, time on page, actions done, and defined conversions.
  • Blogs: Number of unique visitors, returning visitors, page views, time on page, actions done, and defined conversions.

What Is A Good Digital Marketing Roi

There is no single answer to this question. “Good” will depend on your goals, expectations, and strategies, but a couple of examples can help you determine the ballpark of a good ROI.

Let’s say you spend $100 on improving your Facebook outreach. That $100 leads to a total sales increase of $200. You had a 100% ROI. Is that good? It depends on your overhead. If you are selling goods at a 50% profit margin, you just broke even. You spend $100 to sell $200 worth, but it already costs you $100 to produce that much in goods. You will need better than a 2-1 ROI ratio for your marketing to be profitable.

Therefore, a major factor in determining good ROI is knowing your overhead. Your marketing returns have to be high enough to cover operational costs with the new revenue they bring in. On average, a 5-1 ROI ratio will be enough to be profitable and is considered good.

That said, there are times when a lower ROI is still good because it accomplishes a different goal. An obvious example is lead generation. Let’s consider the example of a property investor: The purpose of their digital marketing is to purchase properties. Their digital marketing will not generate any direct return on investment. Instead, it generates leads for property acquisition . In this case, a negative ROI is fine as long as the cost per lead is generating enough property acquisition to sustain the business.

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What Is Counted As A Marketing Cost

When calculating your ratio, a marketing cost is any incremental cost incurred to execute that campaign . This includes:

  • pay-per-click spend
  • outside marketing and advertising agency fees

Because full-time marketing personnel costs are fixed, they are NOT factored into this ratio.

The ratio is meant to give campaigns a simple pass/fail test, so the costs factored into the ratio should only occur if the campaign runs.

Invest In Call Tracking Software

We work on Return On Investment (ROI)

Does your business get phone calls from potential and current clients?

Then you need for tracking and measuring your digital marketing efforts.

Call tracking is a valuable tool because it helps you track offline actions, like phone calls, resulting from your online efforts, like SEO.

Remember, everyone approaches shopping differently.

While Buyer A may prefer to fill out your contact form and wait for your response, Buyer B may decide to call your team instead. If you dont have call tracking set up, you cant prove that Buyer B found your company online thanks to SEO.

Thats why you need call tracking.

No matter which phone number a person calls, their call gets forwarded to your business.

Many different are available.

The tools that offer the most value, however, are the ones that integrate with applications like Google Analytics is one example.

That means you can log into Google Analytics and see data related to your phone calls, like how many people called your business during a specific period.

Tools like CallTrackerFX also sync with your customer relationship management software, which makes your sales teams lives easier.

Even better, CallTrackerFX includes call recording and call transcription.

No matter which call tracking solution you go with, its a smart and proactive way to track your digital marketing performance and ROI, especially if youre a lead-based business.

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What Is Digital Marketing Roi

In the world of digital marketing, Return on Investment is known as the measure of profit or loss generated on your campaign efforts. A positive ROI essentially means that a campaign is making more money than what was spentand vice versa for negative ROI.

As a rule of thumb, digital marketers should aim for an average ROI of 5:1 thats $5 gained for every $1 spent on a marketing campaign.

And if this doesnt satisfy you, set the bar a little higher! Exceptional marketing ROI is considered 10:1 or higher. It will likely require more resources and knowledge to achieve this goal, but it is possible, nonetheless. On the other hand, ROI below 2:1 is non-profitable and is indicative that your marketing strategy needs some work.

Ready To Assess Your Performance

Our team can tell you more about what ROI means in digital marketing, how to measure ROI in digital marketing, and what you might be able to expect from the average marketing ROI in your industry.

Augurian can analyze and explain which ROI metrics that are driving growth for your business so that you can Have Confidence in your digital marketing investments.

Reach out to an Augur today to discuss your digital marketing performance or to learn more about the advertising metrics and ROI. Or, visit our blog to explore digital marketing topics such as SEO, SEM, and Analytics.

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Draw Insights From Kpis To Measure Roi

How does the amount of website traffic, cost-per-lead, search page result rankings, and shares of your Facebook or Instagram posts translate into digital marketing ROI? These KPIs in and of themselves are good indicators of how well your digital marketing efforts are in attracting customers and generating conversions.

If your social media outreach generates interactions with leads or you post viral-quality content, youll likely generate more revenue and sales through heightened brand recognition and authority. Youll likely see an increased ROI because of better website traffic and improved session duration numbers that are achieved through optimizing your website content.

Trust and authority due to greater online engagement and visibility achieved through KPIs will inevitably lead to increased sales and subscriptions. These in turn will result in greater revenue for your organization and a better ROI for your digital marketing efforts.

Use A Customer Relationship Management Tool

Business Analytics | Analyzing the effectiveness of a digital marketing campaign using ROI

CRM software is helpful in tracking leads from first contact through the end of their buying journey. Using CRM software to track leads generated by your digital marketing campaign, and tagging them as such, is an effective way to see how many opportunities your digital marketing spend is creating for your business.

“If transactions are not taking place on your website, and you’re just using it to generate leads, you’ll want to use a CRM like Hubspot to track your leads through to a closed/won customer, and make sure you’re pulling in UTM data to the CRM from your website,” Schneider said. “That way, when a contract is won with a given lead, you can track which channel that individual came from.”

With the data gleaned from these methods, you can calculate the value of your various digital marketing campaigns, whether your preferred key performance indicator is an increased conversion rate or just improved brand visibility and clickthrough rate. From there, it is as simple as finding the difference between that value and your overall digital marketing spend.

However, calculating ROI is not always the best way to tell if a digital marketing strategy is working. Instead, it is best to understand the goals of each arm of your overall strategy for some, ROI should be clear from the start, while for others it might take some time to see a positive return.

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Set Up Conversion Tracking On Individual Ad Platforms

The most basic form of ROI measurement in digital marketing is to set up conversion tracking on a single ad platform, for example, Google Ads or Facebook Ads. Its a valuable first step in the right direction, as 97% of untracked campaigns fail.

If you only sell one or a few primary products/services through your website/landing page, you can manually create different conversions and assign values.

In Google Ads, you can easily set it up without integrations, web developers, and little to no experience with coding yourself. In the Measurement > Conversion section, create a new conversion event, and select Website as the method for tracking it.

Next, select the conversion category based on what you want to measure and create a relevant name for your conversion.

Then, select the Use the same value for each conversion option, and enter a value based on what each purchase/lead is worth to your company.

To install it, you can either manually insert it into a thank you page or use Google Tag Manager.

If you choose to do it manually, all you need to do is copy and paste the snippet into the < header> meta-tag section of your thank you page.

Make sure you dont install the conversion event on your homepage or landing page, as it will count any regular visit as a conversion.

It should only be included on a dedicated thank you page, the last destination of someone who makes a purchase or signs up for a newsletter/consultation/report.

Conversion tracking with dynamic values

Roi Using Digital Marketing Tactics

Above are some general metrics that you can use to measure the ROI of your marketing campaigns.

However, its important to note that the metrics you use to measure your campaigns will ultimately depend on

which tactics you are using in your campaigns.

The metrics that you use to measure email marketing ROI are not the same as those you might use for social media.

Remember, the metrics that you use to measure ROI on different marketing channels will depend on your goals and objectives.

With that in mind, here is a quick list of metrics that you can use to measure digital marketing ROI based on the tactics you use:

  • Email Open rate, click-through rate, bounce rate, unsubscribe rate, conversions, and leads acquired.
  • Social Media Engagement rates, clicks and click-through rate, conversions, leads acquired, and new fans or followers.
  • Landing Pages Traffic, unique visitors, returning visitors, total page views, time spent on page, actions taken, and conversions.
  • Blogs Traffic, clicks, time spent on page, unique visitors, returning visitors, actions are taken, and conversions.

Year Over Year Comparisons

When you are comparing your ROI data, you should refrain from comparing the data month to month.

Month-to-month comparisons dont take into account certain abnormalities or things like seasonal demands.

Instead, take a look at year-over-year comparisons. These will give you a better idea of how your digital marketing campaigns are improving over time.

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Social Media Marketing Roi

Most of your ideal customers are on social media. How effective is your digital marketing at reaching and converting them?

3. Hootsuite

In most cases, a business will maintain a presence in many social media platforms. It can be tedious to track your results on these social media channels individually.

With a tool like Hootsuite, you can manage your social media pages on a single platform and also track results from your social media efforts.

Furthermore, Hootsuite has a social ROI calculator that you can use to calculate your social media marketing ROI. Lets consider this example from a Facebook campaign.

Your costs for a Facebook campaign are $1,000 for the ad spend, $500 for content creation costs, and $200 for labor costs. This will take your investment to $1,700.

If the ad is linked to a landing page on your website, lets assume you got these results: 1,000 visits from the campaign, 10% landing page conversion rates, 50% close rates and your customer lifetime value is $1,500.

From these figures, the social ROI calculator can calculate your ROI which is 4,312%.

If you want to measure your social media ROI across different channels, you can use the Hootsuite Impact. This will create graphs and tables showing how social media has brought in leads and sales.

4. Sproutsocial

You can measure your social media metrics on this platform as well. Apart from creating goals on Google Analytics, you need to have the knowledge of your performance.

What Is A Good Roi For Marketing

Return on Investment

For a marketing campaign to be considered financially successful, it has to have a positive ROI. This means you need to have earned back more than you spent. Using the above calculator it means having an ROI above 0.

This is a very low goal to set for yourself, however. Most people say that the minimum benchmark for an acceptable ROI is 100% . This would mean that you have doubled your investment.

For a good campaign you have to do better than this however. Accepted wisdom on marketing ROI says that getting back 5x your investment is a good goal. If you get 10x or more back from your investment then your marketing campaign can be considered excellent.

Please note: I have personally seen many paid search and retargeting campaigns get an ROI of around 2000% . While this is great, you have to keep in mind that marketing campaigns targeting people who are already likely to convert are going to have high ROIs. A cold outreach campaign on the other hand might very well struggle to break even to start with.

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Create Content Your Audience Wants

In a digital space where consumers are constantly bombarded with hundreds, if not thousands of ads, your brand needs to stand out to become successful. Content is the cornerstone of your marketing strategies, and you need to ace it to ensure that you stand out from the crowd.

Nobody wants to see conventional emails about sales or your new product launch, because its constantly flooding their social streams and inboxes. Customers seek value and personal connections with a brand.

That is why its necessary to ensure that your content is always personalized for your target audience. Once you figure out your target audience, you can create content accordingly. It can be defined based on their interests, demographics, location, gender, etc.

However, personalization isnt the only thing that matters. Here are some other factors that you need to keep in mind while creating content:

  • Create valuable content Your goal should be to provide value to your audience through your content. Create content that is aimed at solving their problems. You should also consider giving good recommendations to them through it.
  • Make your content user-centric From sharing content about your product or services to engaging with your audience regularly via emails, be sure to connect with your audience on a personal level.

Which Type Of Online Marketing Delivers The Highest Roi

Return on investment from advertising is one of the most important factors any business or website has to consider. For online websites this is no different, and there are many types of marketing channels available. The ability to maximize the best average ROI on digital marketing is crucial to being able to maintain reliable growth. So which type of online marketing delivers the highest ROI?

Return on investment is one of the true golden rules for any business. It means being able to demonstrate appreciable revenue from a business-related expense, and more importantly being able to demonstrate profit.

How do you know which marketing strategy is the best for average ROI? First you need to know which type of marketing channels are available and how they deliver results. The sort of results you get will be different between inbound marketing strategies and paid online advertising.

For inbound marketers, content, site structure, and branding that naturally appeals to shopper interests is key to bringing in natural growth. This means creating good content, and letting customers come to you. Paid advertising is less passive and hinges on pushing your product or service in front of shoppers to maximize visibility.

Both these forms have strengths and each one is made of up different kinds of specific marketing channels. Likewise, each one requires its own costs, and offers its own returns.

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Calculating Marketing Roi Helps You See Whats Working

When you calculate your marketing ROI, you can see what digital marketing strategies work for your business. Its difficult to know if these tactics are working if you dont measure how they help your company.

If you calculate your ROI for your digital marketing strategies, you can discover whats driving sales.

This information can help you revamp campaigns to drive better results. It may not be the tactic itself, for example, but the ad copy or targeting causing your low ROI. Calculating your ROI will allow you to see what works, so you can make changes to drive better results.

Measuring Roi In Other Ways

What is ROI in Digital Marketing | How to calculate ROI (Return On Investment)

Weve been focusing on sales growth, whereas many campaigns are aimed at increasing sales leads with the sales staff responsible for the conversion. In this case, you need to estimate the dollar value of the leads by multiplying the growth in leads by your historical conversion rate .

There are also hybrid campaigns where the marketer brings leads through a qualifying filter to get a non-sales conversion for example, something like a person signing up for monthly real estate analysis reports by giving the marketer an email to pass onto the mortgage broker client. The ROI for a campaign like this still has to be measured by how many of those email leads you actually convert into paid sales for goods or services over time.

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