Cross-device tracking. Multi-channel funnels. Attribution modelling. The world of marketing has come a long way since the days of sending a postcard for a sale and attempting to estimate whether foot traffic improved at your store.
Today's data-driven marketers have a wealth of tools at their fingertips, but they are often still lacking one of the most important components of successful marketing: the support of their CFO for new initiatives. It continues to be challenging to prove inbound marketing ROI due to the sheer complexity and volume of the data that is available to marketers. It's all too easy for marketers to become overwhelmed and unsure about measuring ROI in a meaningful way.
No matter how much marketers say they "know" that content marketing ROI continues to grow, CFOs need to see hard figures that show revenue being attributed to these tactics.
Fortunately, there are well-known methods that will assist in determining the return on your inbound marketing investment.
What Type of Metrics Do You Need to Track Inbound Marketing ROI?
Digital marketing tools offer near-unlimited opportunities for tracking, but are you tracking the metrics that will truly move the needle for your organisation -- or are they "vanity metrics" that have a limited business impact?
Vanity metrics are those stratospheric numbers of impressions you received from your latest ad campaign (even though your CTR was dismal). They can make your team and your boss feel warm and fuzzy all over and completely pleased with the campaign tactic, but is the return on marketing investment really there? Probably not.
Instead of going down the path of easily-padded vanity metrics, consider these top three ROI metrics for your next inbound marketing campaign:
- Traffic to your website or blog over the period of the campaign as compared to previous periods or previous years. This helps you identify whether the campaign likely drove a spike in traffic to your sites, a solid indicator that the targeted audience was interested in your messaging and that you were offering valuable content.
- Consider audience engagement metrics as the evolution of impressions -- a much more valuable measure of whether the content resonated with your target audience. This set of metrics tells you whether your content was not only interesting enough to get a click, your audience also decided to either share it with others or take the time to comment. These activities signal that your audience has a "next level" of commitment to your brand.
- Perhaps the best ROMI (Return on Marketing Investment) metric is your conversion rates. Ultimately, your marketing campaign needs to show that you've achieved conversions: actual contact details for further nurturing, registration for demos, sales of products, phone calls from prospects or newsletter sign-ups -- whatever key conversion point you've selected.
What's most important about these metrics is that they are measurable. You can tie them directly back to business value, which is incredibly important when you're attempting to prove the ROI of inbound marketing to your CFO.
You'll also notice that these three inbound marketing ROI measures look remarkably similar to the top-middle-bottom of the traditional sales funnel, and for good reason!
Mapping Current Marketing Efforts and Determining ROMI
There is a great deal of value in taking the time and effort to measure your ROMI, as it allows you to determine if there are specific channels or messages that are not as effective as others. While it's certainly difficult to calculate the ROI of more traditional channels such as out-of-home, radio, television and print advertising, digital marketing lends itself well to meaningful measures.
According to HubSpot's 2018 State of Inbound Marketing, nearly 70% of marketers who responded to the study noted that converting contacts or leads to customers was the top priority for their business, while 61% were struggling with generating leads and traffic to their site.
- Finding the right mix of marketing strategies and tactics that have measurable success tactics starts with a full audit of your channels, messages and media.
- Often, you'll need to consolidate a range of metrics to review overall marketing ROI.
- Set goals based on your most successful campaigns, and rigorously review tactics to reach those goals
- Ensure that you have the tools in place to track all campaigns right through to whatever you call a conversion. (PS no cheating by changing your definition of a conversion half-way through!)
Once you review and benchmark your current campaigns, you'll have a much better feel for the specific measures and standards that will help optimise your marketing spend in the future.
One of the clear visions that should emerge is how visitors are following specific customer journeys through your sales funnel, and where most or getting stuck.
Which Part of My Funnel Should I Optimise?
Once you have clearly defined your metrics for success, it should not be difficult to see which area of your funnel you'll need to optimise for a specific campaign. Let's say you have a campaign and you have defined success as getting 6 sales per 100 clicks to your website. Your funnel may look something like this:
- Top of Funnel: You received 500 impressions on your latest ad, with 100 of those individuals clicking through to your website.
- Middle of Funnel: Of the 100 individuals visiting your content, only 8 chose to engage more deeply with the content.
- Bottom of Funnel: From the 8 content engagements, you received 6 new customers -- congratulations!
While this looks like a perfectly respectable inbound marketing conversion rate of 6% (6 of the 100 individuals who visited the website converted to a sale), it's pretty obvious that the top two levels of the funnel are underperforming and the bottom of the funnel is working extremely well. Pushing more attractive content and offers at the top of the funnel can make a dramatic difference to your conversion numbers, especially when your final sales stage is running so smoothly.
Remember - unlike advertising campaigns, content marketing such as blogs and other long-form content have an extremely long life span and often gain significant -- and compound -- value over time.
Best Inbound Marketing Campaigns
Now that you know what to measure and how to measure it, what does success truly look like in inbound marketing ROI? Marketers agree: inbound is the most effective tactic in marketing, with 53% of global respondents noting that inbound ROI is the highest of any tactics.
Winning at marketing campaigns doesn't have to be costly in terms of time or investments. The results of a few of these campaigns show that it's the engaging quality of the content that often wins the day:
- HubSpot's simple Website Grader tool had a dramatic ROI: growing their market value to over $1.6 billion in this publicly-traded company.
- Cabling Science was able to generate over 1,900 new leads and nearly 20 high-end customers -- with a marketing ROI of 16% for a recent campaign by taking advantage of inbound activities that were laser targeted to achieve conversions and track leads throughout the sales funnel.
- Facilities management software provider iOFFICE created a multichannel inbound strategy that included email campaigns, lead nurtures, and real-time optimisation of the messages being delivered. The results? New customer acquisition was up over 65% and the organisation doubled the leads coming in from their website.
Whether you are focused on creating white papers to gather customer contact information or are looking for ways to make a direct eCommerce sale, there's no question that inbound marketing can be successful for many types of business.
What truly matters is ensuring that you're actively measuring and reviewing the metrics that will have the greatest impact on your business -- and that will always be appreciated by your CFO.
When you're ready to get started, the innovative team at Brand chemistry is ready to help supercharge your inbound marketing.
Download our free Inbound Marketing ROI Calculator to get started uncovering your marketing ROI today!