Before we go into the whys of the topic, it is first important to understand what Return on Investment is and how it is measured. Return on Investment as the name suggests refers to the benefit you get out of a campaign or an idea you invest in. It is usually referred to with regards to financial implications and the output of money from xyz. But it is not always used in terms of money put in, because the return on investment could also be from the time and resources used.
Ultimately, we are searching for a metric which produces productivity within a business. The best and most optimum use of time, money, resources across the whole business. And therefore the impact of this will lead to sustainability and the easiest way to scale. If you are maximizing every penny, every second, every choice has a purpose and a reason. This is what will bring efficient results. ROI is aligned with structure and logic, and it is a marketer’s Holy Grail for achieving the quality of traffic for lead generation.
Importance of ROI
The reason why this is so important to measure is because it gives you the idea of whether your campaign was a success or a failure. A great Return on Investment obviously means the campaign was a hit and a small Return on Investment means you need to change something about the campaign and try a different approach.
As a marketer, the only solid measure of whether or not you’re going in the right direction is to measure your Return on Investment. Not only can your Return on Investment help you decide the success or failure of your marketing campaign, but it can also help you in determining other factors that contribute to your business’s overall success. Here are some of the factors that you can determine from your Return on Investment:
- Identify the Weak Points
Sometimes the same market campaign may hit well with a certain audience and completely fail for another demographic. Measuring your Return on Investment data for different demographics that you target can help you decide whether the strategy as a whole need to be changed or there are only few areas that need a slightly different approach.
- Improve Marketing Metrics
Measuring Return on Investment across different platforms helps you understand your strongest areas and where your target audience is most saturated. For example, if for the same campaign your Return on Investment was more from Facebook and less from your blog, then you know where to invest in the next time.
- Ensure Peer Trust
As a marketer, the only way you can solidify your position in a company is through statistical data. And this statistical data is none other than your Return on Investment for the marketing campaigns that you design for your company. A good Return on Investment data helps peers trust more in your thought process and your strategy.
Return on Investment is a vital data measure and is not only restricted to monetary return. It encompasses all forms of benefits that your business drives from the investment in terms of your marketing strategy.
This includes and is not limited to leads generated and converted, improved brand presence, engagement of existing and potential customers, improved website traffic, average session duration, average time spent on each page, email leads, subscriptions, etc.
If you are a marketer we suggest you make the most out of the data you gather from ROI and use it to your benefit in not only improving your company stats but also as a measure of your own performance. However, as a smart marketer, you should not restrict your marketing ROI to only improving your marketing activities but also look at the bigger picture and utilize it to understand how you can align future campaigns with your company objectives.