Marketing is an integral part of every business’s growth plan, but if you don’t understand how to adequately measure your efforts, it will be hard to launch campaigns that result in true business development.
Here’s how to make sure you get the most return on marketing dollars (ROMD) invested.
1. Establish a baseline
“Marketing cannot be viewed as an expense; it must be viewed as a revenue stream,” says Michele Elrod, executive vice president and head of marketing at Regions. She recommends that companies approach their marketing efforts systematically. Make sure you have a handle on your business’s benchmarks—for example, the number of leads you typically generate over a set time period—so you can determine whether or not your investment results in true incremental lift. “What did the dollar get you that you wouldn’t have gotten otherwise? At Regions, we look at cost of the account or cost of the funded account minus the investment we had to make. It’s a pretty strict form of measurement,” she says.
2.Make informed, data-based decisions
One of the benefits of digital marketing is that it affords marketers unparalleled access to data. This allows a company like Regions to monitor its marketing efforts in real-time. “We can now make changes to the way we manage our marketing dollars and our marketing messages based on real-time data,” she says.
If you are just starting your marketing efforts, begin with a channel that provides transparency and data, suggests Nick Simard, vice president & COO of InspiriaMedia, a New York-based advertising agency and recent INC5000 recipient specializing in outdoor advertising and online growth marketing. InspiriaMedia works with a diverse mix of businesses across varying verticals and recommends investing seriously in developing an online lead generation machine. Now is the time to advance online to avoid “significant challenges in the future.”
“Marketing today is very exciting because you can calculate what’s working and what’s not for most channels much more easily than you could just a few years ago,” says Simard. “There is just such an intense amount of data available that there is no excuse to not be demanding return on investment (ROI) by finding effective marketing channels. Business owners and managers are more interested than ever in using these metrics to find growth.”
Although monitoring is important, you don’t want to make changes too quickly, notes Elrod. You want to look for trends and ensure that you understand your campaign’s impact over time. But you should be able to notice if a campaign isn’t working at all. “You can usually see if a message is absolutely not moving the needle from the very beginning,” she says.
When that is the case, there’s no reason to wait. Take quick action.
3. Think beyond ROI
Elrod and her team work to ensure their “marketing investment returns in a reasonable amount of time for a reasonable cost,” but her team has other goals that can be harder to measure, such as improving brand awareness and building relationships with customers.
“There are some things that are not monetary but are very important to the foundation of the brand. It’s really important to us to help people make more informed financial decisions. To do that, you have to educate, and to do that, you have to build a resource center with content. Efforts like that can be harder to measure,” she says.
So although measuring ROI is important, also consider what ideals your brand stands for and what value you’re delivering to your customers and potential customers.
