Your clients all expect a good return on their marketing, but what is a good marketing return on investment (ROI) and what are the metrics you should be using to define it? ROI is regarded as the amount of engagement your marketing is generating and how this is converting into sales. If your clients are spending money on marketing in order to make money, they will be looking for showing a strong ROI.
How Is ROI Calculated?
ROI is based on two metrics:
- The revenue that is spent creating marketing campaigns.
- The revenue generated as a result of marketing campaigns.
This can vary from business to business, and large enterprises will factor in many different variables to arrive at the result. Another issue with ROI is that it also takes time to measure it. Businesses cannot expect an immediate response to their marketing and it can take months before a business starts to see the profits of just one campaign.
In the marketing industry, a good ROI is regarded as 5:1, which means that a business earns $5 in profit for every $1 spent on marketing. A 2:1 ration is not regarded as good, as the cost to produce products is normally about 50% of the sale price, so a 2:1 ROI means the company is just breaking even with its marketing.
SEE ALSO: Master Activity Based Sales
The Intangible Vs. Tangible Metrics
To effectively calculate your clients ROI, you need to look at a wide range of ROI metrics, ranging from the intangible to the tangible. This can include brand awareness, lead generation, customer retention, website traffic, sales and repeat sales. To measure these metrics, use the following tools:
Tracking your website analytics will indicate whether you are seeing an increase in traffic in response to your digital campaigns. Are your visitors spending time on the right pages and engaging with the content? How long they are viewing the content? Effectively tracking and analyzing these details will help inform your strategies going forward.
Once your client has launched a campaign, you should expect to see an increase in their pagerank as their website traffic increases. Keep track of whether the overall website rank is increasing, or if the increased ranking is specific to the campaign pages.
Your clients’ digital campaigns will all have inbound links on them in order to drive prospects to their website. These links need to be observed closely, especially to see which links are driving the most traffic. This will help your marketing team assess what content is attracting the most attention and what platforms are seeing the most success. If your clients are unable to determine where their leads are coming from, it’s impossible to gauge the ROI of their content.
Social Media Scores
Facebook and other social media platforms will provide analytics to show how audiences are engaging with the content. An increased amount of comments, shares, and clicks all indicate that the content is receiving attention. Monitor how social is driving traffic back to your website and which channels this traffic is coming from.
Lead Volume And Source
In addition to keeping track of how many leads are coming, ensure your clients always ask their leads where they heard about your clients’ products or solutions, or that you have the tracking in place to see these insights. This will give you immediate feedback as to whether they were outside referrals or reacting to a particular campaign’s content.
Monthly Recurring Revenue
If your clients have a software as a service (SaaS) company, they will have made all their investment upfront and their revenue source will be their clients’ monthly subscriptions. To see if their marketing is showing success, you need to track their monthly recurring revenue in order to create a solid benchmark for ROI.
PandaDoc. Helping You Improve Your Clients’ ROI
In order for businesses and their marketing teams to be effective in 2017, they need the latest content marketing tools that manage marketing content from start to finish and include the right ROI metrics. PandaDoc’s single platform provides an all-in-one solution that has helped clients increase their close rate by 75% and more than double their customer base.
The PandaDoc Partner Program is helping clients improve their sales productivity and increase the ROI of their marketing and sales campaigns. For more information about how we can help, get in touch with a PandaDoc sales enablement expert.