Tracking Your Marketing ROI

It seems as though everyone wants to track their ROI (Return on Investment) these days. And that is a very good thing. Successful companies should be examining every aspect of their business to optimize production, reduce waste, and increase profits. When it comes to marketing people want to know that whatever they are spending on marketing is working. It’s a fairly simple calculation:

(Return – Investment) / Investment

 

Seems easy enough, right? Yes, that is a basic formula we all learned in middle school. However, marketing is more art than science most of the time, so the difficulty comes in not in actually crunching the numbers, but in knowing what numbers to crunch. Saying that you spent $5000 on marketing last quarter and got $10,000 in sales doesn’t paint an accurate picture. Did those $10,000 in sales happen because of your marketing? Were they organic? Were they a result of something that you had done before?

Truth be told, being able to track your marketing investment starts before you ever publish any content. Prior to concepts being discussed or ads being created, you need to set goals for your campaign. What are you hoping to do? In our 5 Essential Steps e-book, we talk about goal setting. Specifically about setting S.M.A.R.T. goals that will help you know exactly what you are wanting to track and for how long.

Once you have set your goals, you then need to think about how you will know if you are achieving them. If you listen to the radio you’ll hear a lot of “To take advantage of these great savings go to savemelotsofmoney.com/Dave”. Those specific urls help the company track which host is driving sales and where they want to invest in future campaigns. While you may not be doing radio ads in your next spot, this is a tactic that we can all take advantage of.

Creating landing pages specific to a campaign is important. Through proper use of analytics you can track not only traffic but patterns across people who came to your site for the campaign and where they went after hitting that landing page, what they purchased, and how much the campaign may have generated in online sales. You can also set up multiple urls for the same campaign (i.e. campaign/radio, campaign/tv, campaign/newspaper) to track which specific ads were generating the traffic.

Tracking traffic is easier across digital platforms. You know how many website hits, page views, online sales, etc. But how do you know if the customers who come into your store are there because of your marketing. Sure, you can notice if your overall sales are up, or there are more visitors in your store. Knowing that they are there because of your marketing rather than another reason can help you make more informed decisions about future marketing efforts. So, how do you get this information?

While there is no sure-fire way to get all the information, there are a few that often work. Offering a discount or prize if your in-store shoppers is a good way to get feedback on not only what brought them to the store, but what they liked about their experience, where you can improve, and more!

Maybe the most reliable though, and coincidentally one that will really up your level of customer service is talking to your customers. We’ve all been the shopper who just wants to race in, get what we need, and race out. Yet we have all been the shopper killing time or enjoying an afternoon window shopping. Training or teams to talk to customers not just about the products in our stores but what brought them in is a great way to track whether or not your marketing is working. You can make a note on the receipts about who came in via what campaign and add those totals to see what marketing efforts are truly ringing your register.

Now, for those of you in the service business you may be sitting there going, we’ll yeah it’s easy if you have something tangible to sell and get window shoppers – what about me who only sells a service? This same principle applies to you as well. If you are a doctor’s office you can include a “how did you hear about us” box on your form that you give your patients as they enter. Train your staff to ask that question and you may be surprised at the results. The more open and engaging you are with your customers, the more information you can get that will help you get even more customers.

There are some other things to consider when you are talking about tracking your marketing investment.

  • Goals without a direct return – If you have a goal of increasing website traffic or getting more social media followers, that may not ring your register but does have a positive impact on your business. Don’t discount these goals and make sure that you budget for increasing your following.
  • Brand Recognition: Measuring brand recognition is incredibly difficult but that doesn’t mean you shouldn’t have some goals towards increasing your brand. Much like the social media follows, this will have a positive impact on your business but you may not see an immediate ring in the register.
  • Competitors: Often times what your competitors do, positively or negatively, will affect you. If you sell an identical product and your competitor raises their price by 10%, you may see more traffic. Being aware of what your competition is doing and how it affects you is important but can be tough to quantify since you aren’t investing anything.
  • Just because your timeframe ends doesn’t mean you stop tracking. You may have set a timeline of a particular month or quarter, or even year. However, your customer doesn’t know that. That campaign may continue to bring you new customers or traffic for months or even years to come. This is especially true of digital content which can live on your site forever. Someone may stumble upon that blog long after your timeline but it is still paying dividends. Now, please don’t misunderstand. We aren’t saying to throw out timelines. You still need them to ensure you are getting the most bang in a reasonable amount of time. However, you don’t want to stop reporting because you never know when that campaign may trigger a new customer to walk through your door.

Once you know what comprises your actual return, you can go back to the simple formula from before and calculate an accurate ROI for your marketing campaign. However, this is not the last step. The last step is using that knowledge to inform your next marketing campaign, and continuing the cycle of improving and growing your business.

Rokusek has been helping companies navigate and track their ROI metrics for nearly 30 years. We’ve got experts in analytics and brand strategy and can help you make the most of your investment. Call us today and schedule a time to come in, have a cup of coffee, and talk about your goals and how we can help you exceed them.

Our team is ready.