Can You Measure Your Marketing ROI?

Copyright 2009, Vogel Marketing Solutions LLC

John Wanamaker reportedly once said "Half of my advertising dollars are wasted. I just don't know which half."

Here’s what blogger Chad White said in a recent posting:

“According to the most recent ANA/MMA Marketing Accountability Survey, nine out of 10 finance executives said they don't use return-on-investment metrics to set marketing budgets in the annual budgeting cycle. Two-thirds instead take a predetermined percentage of revenue or simply adjust last year's budget. For whatever reason, CFOs don't believe the numbers.

“Considering that CFOs give so little weight to ROI when making budget decisions, it shouldn't be a surprise that companies also don't try very hard to measure ROI in the first place.

“According to the Conference Board, more than one-third of companies haven't made any efforts to measure marketing ROI. Thirty-seven percent have been measuring ROI less than a year; 40% have been measuring ROI over the last one or two years; and less than a quarter have been at it for more than three years. Among the remaining companies, which had implemented programs, none have yet achieved their goals in measuring ROI, with the major of those companies saying they found the process harder than anticipated.

“Even with the difficulties in measuring ROI, it's shocking to me that companies' financial gatekeepers place so little stock in performance and visibility -- essentially, so little stock in basing their decisions on real numbers. Looking on the bright side of our nation's current economic troubles, it has started to put more emphasis on performance."

Here are some ideas to consider in order to better measure the return on your marketing investment.

• Google Analytics: can’t beat the price—it’s free. Analytics provides detailed insight into your website’s traffic. This information can help improve all marketing initiatives, both on- and off-line, and helps create higher-converting websites. Learn more about Google Analytics >>
• Custom Landing Pages: in your marketing materials, are you sending everyone to your home page? Create specific landing pages for each of your marketing communications materials. If you send out a news release, don’t just say “For more information visit OurHomePage.com”. Instead, send them to “OurHomePage.com/ThisNewsRelease.” Then, use Google Analytics to measure how many people visited that page. Remember, as you create more pages with relevant content, you’ll improve your site rankings in search engines. Read my Landing Page Checklist >>
• PURLS: while this can be costly, Personalized URLs (or PURLs) can be highly-effective in boosting response rates to direct mail and email campaigns. A custom web address (such as “www.ProspectName.YourCompany.com”) is printed on the mailer and sent to the recipient. When they visit “their” page, they are greeted with “Welcome “Prospect Name”. This is effective for companies with well-developed databases and big-ticket product sales.
• Email Marketing: According to an October 2008 report from the Direct Marketing Association, "the return on investment from e-mail far surpasses other channels."  E-mail’s ROI in 2008 was $45.06 for every dollar spent on it, compared to $15.55 for non-catalog direct marketing, and $7.28 for catalog marketing.  In fact, Chad White wrote recently that research shows email's ROI closer to $130! With email marketing, you know exactly how many emails were successfully delivered, who unsubscribed and why, how many opened the email, how many read the email for a certain length of time, exactly who clicked through to your website, when they clicked, and which page they visited. Learn more about Email Marketing Services from Vogel Marketing Solutions >>
• Sale Force Automation Programs: while many companies maintain an SFA system (such as SalesForce.com) I find that they are not using these tools as they should, or with consistency. If a new contact is added, your employees MUST fully define where a lead came from: a specific trade show, a call-in to the call center, website visitor, etc. Monitor each employee’s adherence to timely completion of this information, and use that as a measure of their continued employment. It’s that important.
• Custom Telephone Numbers: publicize a specific phone number in an ad—you’ll know that each call that comes to that number is from that ad. Also, I’m working with a local firm that offers telephone marketing services that can record all incoming calls, allowing you to listen to your call center’s behavior.

I can help you with any of the actions above to help measure your marketing ROI. Call me at 717-368-5143 or email me now.