Marketing ROI is often likened to Military Intelligence or, lately, to Business Ethics. Talking about each individual word as a singular concept makes sense, but when facing each in the same phrase it sounds like a contradiction.
This is not to say that marketing people cannot produce real results. As a matter of fact, they often have visible proof of their efforts, as in a new print ad, direct mail piece or even the slick television ad. But visible proof of effort doesn’t equate to results. Visible proof doesn’t protect them from the often asked question,”So what sales did this help produce?” I’ve heard this question myself many times coming from sales persons as it gets closer to the end of the quarter and they are saying it with a tone of frustration as they are trying to meet their numbers.
Measuring ROI in sales is relatively simple. If salespeople meet or exceed their targets the company will keep investing in their employment. Measuring ROI in a selling process may not actually be that simple, but a closed sale is a clear indication of success. There is a real result, not just proof of effort.
Many marketing people feel threatened by the need to “justify their existence” with factual results. They shouldn’t. In fact, the ability to track, measure, improve and prove the value of marketing is probably one of the biggest benefits of Internet Marketing. The integration with Internet Marketing offers a new potential and means to track a campaign from interest to final sale.
It is understood by many companies that an Internet based campaign has the ability to record many useful details about their web site activity; in fact, it can often be too much information. The daunting task of not knowing how to begin and with what tools has left some companies in a state of doing nothing. Be cautioned! This could be a grave mistake. Some would say, “Our web site is enjoying a booming business, so why worry?” If you don’t know why you are succeeding, how will you know what to change when your results take a nosedive?
We worked with one company that had 95% of their sales coming in over the Internet and quickly went from boom to bust in a matter of just two months. After asking the typical questions (i.e. was this happening in general to their industry, competitors, or were there changes in buying behaviors?) we had little to suggest in the way of fixes since the client didn’t even have the basics of search engine ranking reports to review. Since they didn’t keep track of where the majority of their traffic was coming from, it was impossible to even guess if changes in search engine methods was adversely affecting them. The only option for them was a quick fix launch of a paid placement program to get their traffic back up, which is an expensive solution at best.
The obvious key to measuring Marketing ROI is first of course to create a foundation for tracking. Buying processes progress through typical stages, so decide the amount of minimum information you plan to track and measure before selecting the type of tool to use. Your ROI objectives will vary at each of these stages:
· Interest Stage: What are Visitors looking at on your web site?
· Awareness Stage: Who is bringing in the Right Traffic?
· Conversion Stage: Are they Willing to Buy?
· Handoff Stage: When Selling is Still a Requirement.
Although many of the tools and techniques are still in the early phases, the opportunity is here today to develop a real Marketing ROI environment. By simple planning and some process design, you can build a mechanism to track and measure your marketing campaigns. Then you’ll be in a position to bargain for increases to your budget, getting that quarterly bonus or keeping the sales team off your back! Start today and don’t let Marketing ROI remain a contradiction.