Accurate ROI calculation tells you which marketing elements should get the attention.
I think most marketing managers and company decision makers would agree that the better you can track individual elements of any inbound marketing strategy, the better you can calculate ROI. Tracking and measuring your website traffic, your leads (conversion rate) and your customers is the foundation of calculating ROI. Marketing executives and marketers in general will always be faced with the challenge of better understanding and answering questions like these:
- Where is our money going?
- Why is this costing more than that?
- Should I spend more money here?
- How much return do get with this?
- Which of these methods work better?
- Is it easy to learn How To Calculate ROI?
Here you are, responsible for operating a company or organization and trying to be as profitable as possible. Maybe you are blessed with years of experience and have loads of education in the form of marketing degrees or certifications. You are tasked with the challenging but fundamental requirement of being sure your product or service makes money. You might fall into the category of being the owner of a small business that isn't extremely complicated or maybe you are overseeing a complex operation that is selling multiple product lines, accessories, supporting services, affiliates that is both labor intensive and equipment intensive. In either case your objectives are quite normal... Create a marketing blueprint, a marketing plan, marketing strategies and multiple marketing campaigns that produce the highest possible sales resulting in the largest profit possible.
Even if you don't meet the goals exactly like the ones stated in the last sentence of the above paragraph, you can still be successful. If you are showing profit and a method that can grow that profit over time, you are a winner. But, what if you see profit begin to decline or have a bad month? Then, as I'm sure you have experienced already, the spot light on you gets a little hotter, questions come more frequently and the time tables get shorter. As long as profits remain in the comfort zone, you are safer, and whether anyone else recognizes this or not, if you are really good at what you do, safer gives you more freedom to be more creative. Increased creativity can result in increased profits and so on and so on. All of this simply translates to the better you do your job, as a marketing executive or decision maker, the more profit the organization will experience and the easier your job becomes. As part of this process you can use this free ROI calculator. Of course there can be more factors that influence these simple relationships like competition, the economy, the price of cotton swabs or anything else that affects your specific business.
The point I am making is a simple one. Keep the ROI stable or moving upwards and you are looking good as a marketing professionals. So, what might be the biggest challenge when trying to meet this objective? In my book it's calculating ROI. I wrote this particular blog post to help readers learn how to calculate ROI. I can't stress enough how learning how to calculate ROI will help you achieve your primary objectives of making profit and increasing profit. After all, a wise man once said, "if you can't measure it, you can't manage it". Think about how much truth there is in this simple statement.
When it comes to inbound marketing, this challenge has recently become easier. There is very little in the world of marketing that can't be tracked and if it can be tracked learning how to calculate ROI becomes that much easier. Here is a basic breakdown in outline format of the primary components of a comprehensive inbound marketing strategy. You should be able to see as you look over this short outline where your specific marketing campaigns fall and therefore where the tracking begins. This is also lesson one in how to calculate ROI.
I. Inbound Marketing Strategy
A. SEO (search engine optimization)
B. Blog Development
C. Social Media Promotion
D. Data Analysis
II. Inbound Marketing Components - The marketing campaign elements that can be tracked.
A. An Offer
B. A Landing Page
C. A Blog Post
D. Social Media Promotion
E. CTA (call to action)
G. Smart Lists
If you study and absorb the simple list above, you should then be more able to see with more clarity how each inbound marketing components support an inbound marketing strategy. The next lesson on how to calculate ROI is to diagnose how the inbound marketing components can be tracked and how the data that is produced from these inbound marketing components can be analyzed. Once you get more fluent with analytics, understand what specific data is telling you, and what role each data stream plays when you calculate ROI, the clearer this puzzle becomes.
This is the first in a series of blog posts on the subject of How To Calculate ROI so bookmark this page or subscribe (top right of this page) to be notified when the next article is posted. As I post these articles teaching how to calculate ROI, I will also offer resources that will help you with this process. Today we are providing you a great but simple tool to calculate certain components of ROI. These are fundamental elements like traffic, visitors, leads and customers but they are critical to calculating ROI accurately. Like anything else, the results of your calculations are closely tied to the accuracy of the process.
Download a free tool that will help you better calculate your ROI by helping you establish projections and assumptions regarding your traffic levels and what you need in terms of conversions to meet your ROI goals. Just hit the button below to get your ROI calculator now.