Digital Marketing Campaign The resources, time, and effort you devote to strategizing your brand’s digital marketing campaigns must eventually secure desirable returns. Measuring this return on investment (ROI) allows you to effectively allocate your budget and make your digital marketing spend worthwhile.
Via ROI marketing, you can assess whether this digital exercise generates a profit or loss for your company. The returns are positive when such campaigns bring in more money than what you invest. Without evaluating your brand’s digital campaign, you will never know whether you are spending your marketing budget wisely or wasting money.
Before calculating your campaign’s ROI, first, establish the following:
Understand Your Objectives
You undertake a marketing campaign to achieve larger goals; hence, having clarity on these objectives at the outset is vital. Aspects like clicks and lead generation, which though have no monetary value, reveal the effectiveness of your marketing strategy.
Identify Your KPI’s
Key performance indicators or KPI’s are unique to every business venture and must be in sync with your overall marketing goals. Identify the parameters, like monthly visitors to your official website, the cost to acquire each lead, customer lifetime value, or average order value.
Adopt Accurate Data Collection Methods
The method used to collect, enter and calculate the initial data impacts the accuracy of your findings. When the data has inconsistencies, you end up with inaccurate ROI’s and KPI’s. Setting up a centralized and uniform data collection system pays dividends in the long run.
Concentrate On the Larger Purpose
Examining the impact your KPI’s have on improving your ROI makes the former more powerful. These parameters are ultimately interconnected and conform to a pattern. Drawing revealing insights from each helps you optimize your marketing efforts and boost your brand image.
Importance of Measuring Digital Marketing ROI
Businesses of all sizes invest in digital marketing as modern-day consumers research a brand to make an informed choice. Measuring your online ROI marketing helps you gauge the effectiveness of such campaigns. These findings allow you to:
- Assess if the campaign meets expectations or not
- Review the feasibility of your marketing budget
- Fine-tune your marketing campaign
- Secure more funding to execute successful strategies
Determining Digital Marketing ROI
You can monitor the suggested digital marketing metrics to measure your ROI:
When your primary goal of launching a digital marketing campaign is to convert your target audience into loyal customers, this metric helps assess your success rate. You can allocate more resources to channels that are converting better than others.
Devices that guarantee high traffic like mobiles need not always deliver stellar conversions, thus, necessitating a rethinking of strategies. Studying your conversion rate allows you to re-evaluate your campaign and take corrective action.
Cost Per Lead
If you are collecting new leads through your marketing campaign, you can evaluate how much each lead is costing your brand. You can calculate the same by dividing your total marketing expenditure by the number of leads earned from that campaign.
Where the cost exceeds the revenue generated from closing these leads, it indicates your ROI is falling short. To achieve a positive ROI, your income must surpass the amount you invest in such marketing campaigns.
Lead Close Rate
Campaigns closing leads at a below-average rate demand adjustments. When the percentage of leads resulting in actual sales is significantly high, the said campaign delivers the goods. A favourable ROI outcome indicates a profitable marketing campaign.
Average Order Value
This metric is arrived at by dividing your total revenue by the orders placed. It thus tracks the average dollar spent when a consumer places an order. Even a percentage increase in the average value of each order is more worthwhile than a mere rise in orders placed. An enhanced user experience can help achieve profitable returns in order value.
Cost Per Acquisition
Dividing your entire marketing cost by the generated sales reveals the average cost incurred on acquiring every new customer. When you are spending more than the amount you earn from your consumers, your ROI reflects negatively.
Customer Lifetime Value
It is essential to decipher the amount a consumer is likely to spend on your brand over the period they remain your loyal customer. The long-term profit you earn by assessing a client’s overall value covering the foreseeable future paints an accurate picture of your ROI. This perspective involves seeing beyond a consumer’s first purchase.
A yearly comparison of your ROI data facilitates a fair assessment of your marketing campaigns. Make your venture a success by partnering with a growth agency that does not believe in wasting precious resources.