Measuring the ROI of digital marketing strategies
Decode the results of your marketing efforts to reach customers online.
A recent report indicates that 70% of small to midsized businesses expect to increase their digital marketing budgets in 2017. Those efforts may be wasted if they don’t measure their return on investment (ROI), however.
“As a small business owner, your livelihood depends on getting money back for your investment,” says Adam Brayman, digital marketing director for the National Federation of Independent Business. “Measuring ROI is an absolute must to keep the doors open.”
Use built-in measurement tools
Small businesses can take advantage of several useful tools — many of them free — to measure the ROI of their websites, search engine optimization (SEO) efforts, content marketing strategies, paid digital promotions, email campaigns, and social media platforms.
Several large scale digital companies offer free analytics tools to help businesses assess their marketing programs. Google Analytics is an essential suite of solutions that provides data collection and management functions as well as analysis and reporting to measure traffic, conversions, SEO key performance indicators (KPIs), and other web-related metrics.
Social media sites such as Twitter, Instagram, and Facebook also offer free analytics tools, as do website providers such as WordPress and Wix. If you use an email marketing service such as Constant Contact or MailChimp, you can also track the success of your email marketing campaigns. These solutions can help businesses learn where their digital marketing efforts are successful and where they may need improvement.
Measuring the right metrics
Analytics tools can only help your business if you’re measuring the right KPIs. You may know your customer demographics and some trends among your target audience, but you may not know what draws them to click on your social media link or share your website content. When you try different approaches, analytics tools can tell you what worked and what didn’t.
“Analytics tells you what your audience cares about, so you can make changes,” says David Mitroff, founder and CEO of Piedmont Avenue Consulting in California. “It tells you how to market better.”
If you have an e-commerce website, you’ll want to measure where traffic is coming from, especially when visitors make purchases or sign up for a newsletter. For the best return on investment, you’ll want to attract similar leads that convert to customers.
Additionally, analytics should break down the demographics of the traffic, such as gender and age. If you find that 90 percent of your web traffic comes from men who are between 45 and 55, Chuck Trautman, founder and CEO of the Arizona Marketing Association, says you can either tailor your offer to that demographic or re-craft your message to appeal to a wider target audience.
Expanding the appeal of your digital marketing efforts is a great way to increase leads, but keep in mind the ultimate goal: sales.
“It’s great that you can get someone to come to your website,” Mitroff says, “but you have to convert them into a customer.”
If you’re ready to convert more leads into sales, consider these tips for increasing online sales.