When it comes to marketing performance, one of your main goals should be to measure and calculate your brand’s success. Return on investment or ROI in marketing shows you how much you have succeeded with your strategy and approaches. It also helps you measure your gains and losses to help your business grow.
This can be determined using specific metrics that can be pre-set to evaluate how your digital campaigns are performing. Here are some of the main things that you can measure for your return on investment analysis:
- Cost per Sale. You should allocate a budget for acquiring new customers. To calculate your cost per sale, divide the total spent on your campaign by the total number of sales that you got from the drive. If the result is more than what your leads will bring in to the business, then your return on investment is negative. Try tweaking and improving your strategy to lower the cost per sale.
- Conversion Rate. This metric helps you find out what percent of your website visitors are being converted into buying customers. As a start, you should check your conversion rates for each platform that you are advertising on. Divide the number of conversions that you have during a specific time frame by the total website users and then divide it by 100% to find out the rate. Learn more about computing your conversion rate here.
- Customer Lifetime Value. If you want to know how much your loyal consumers will spend over their lifetime, then you’d want to measure your customer lifetime value. To do this, you would need to multiply the average sale per client by the overall number of times your patrons buy from your brand per year. The result should then be multiplied by the typical retention time in years for a regular customer. This will teach you more about computing CLV.
- Cost per Lead. Computing the cost per lead is different from measuring the cost per sale. Cost per lead pertains to the leads that your marketing campaign has brought in. To measure, simply divide your total campaign spend by the total leads that you were able to generate through the promotion. If the results are higher than the amount that after closing the deal with each lead, then you are not getting your return on investment.
Here are some optimization tips on how you can maximize your 2021 marketing ROI:
1. Work on List Segmentation
List segmentation provides users with a personalized experience. This is often done in email newsletters, where contact lists are segmented so the messages are targeted to specific audiences. The following should be taken into account when creating a list:
- Location – Determines where most of your target market resides or where you want to target.
- Demographics – Segments the population based on their sex, age, and other factors.
- Purchase amount – Filters your customers based on the amount that they usually spend on your brand.
- Interests and hobbies – Find out which of your consumers’ interests and hobbies can be linked and used to improve their purchasing habits.
- Browsing history – Allows you to tailor your ads based on recent search activity.
- Purchase history – Lets you control the advertisements based on previous purchases.
Getting additional information and feedback from your buyers will allow you to give them a more positive and personalized shopping experience.
2. Set Specific and Realistic Goals
Competition is fierce in 2021, which is why you’d want to make sure that you’ll be setting specific marketing goals. Set a well-defined objective and list everything that you’d want to accomplish for your brand to increase ROI.
You have to make sure that your data is measurable, relevant, specific, achievable, and time-bound when setting your plans. Avoid setting up vague goals that you cannot compute so you can measure your progress. They have to be realistic and attainable, too.
Additionally, your objectives should be relevant to your overall plan. Establish a feasible timeline for achieving these intentions.
3. Focus on Your Data
You have to analyze your data before you decide what you need to focus on. Consider using dashboards and custom reports to study your campaign performances and hiccups in your strategy.
A customized dashboard will help you check your progress regarding your KPI metrics and overall plan. However, these dashboards would not allow you to compute your ROI. You also wouldn’t be able to tell why your ads are underperforming.
If you want to delve deeper into the data, then consider using Google Analytics so you can see your traffic sources, operating systems that your visitors use, and device categories. This also helps you track where you are on your goal completion.
4. Track Your Income and Ad Spend
Your ROI will not improve if you are not tracking your ad expenditure and income correctly. Keep tabs on how much you are spending per campaign. This way, you will know which ones you should increase your budget on, which ones are performing poorly, and what to tweak or let go of.
You can use our guide above to determine how each platform is performing based on your conversion leads, rates, and profits.
5. Pay Attention to Important Metrics
Tracking your metrics based on your goals should be your focus in 2021. For example, if you are looking to increase your sales and revenue, then you’d want to focus on these:
- Cost per Acquisition – The cost of acquiring a new customer.
- Conversion Rate – The percent of website visitors that you were able to convert into buyers.
- Customer Lifetime Value – The overall worth of a lead for your business.
However, if you want to focus on brand awareness, then give importance to these metrics:
- Referral Traffic – Guests who enter your site through links and referrals.
- Direct Traffic – People who visit your website directly by typing your URL into their address bar.
- Social Media Activity – Pertains to your social media mentions and interactions.
6. Work on Marketing Automation
Marketing automation will help you achieve your ROI by letting the software do the heavy work for you. Consistency is key when it comes to your return on investment, and posting regularly will help do the trick. Choose the right software for leveraging automation and you are on your way to improving your ROI in 2021.
Here are a couple of marketing automation tools that you can check out:
- Constant Contact – A useful email marketing automation tool that you can use to automatically send emails to your consumers. It also offers other useful tools such as Facebook fan promotion, email edits, autoresponders, and more.
- SaaS BPM – A business process management system that can help you manage recurring activities. It can also help optimize processes, track company, employee, and project statuses, handle onboarding, and manage teams.
- Dialog Tech – A tool that allows voice-based marketing automation to help companies boost their return on investment with analytics and automation.
- Marketo – A marketing automation tool that helps cover all channels and engagements.
- Omnisend – This allows you to apply marketing automation on multiple channels such as push notifications, email, Facebook messenger, SMS, and more.
7. Lead Nurturing Can Help
Decreasing churn rates and working to avoid cart abandonment will help you improve your return on investment. Since you already have these people interested in your brand and what you have to offer – the only thing left to do is for them to finish their purchase.
Nurture your relationship with your customers and introduce dynamic retargeting – which is the process of creating unique advertisements that are unique to each consumer. It is similar to personalization in the way that it analyzes customer buying behavior.
Remember: the more you show your patrons that you know what they are looking for, the higher the chances of them finishing their shopping with you and checking out. You can also use coupon codes and discounts to encourage buyers to finish their purchases.
8. Don’t Ignore User-Generated Content
Building trust and rapport with your customers should be one of your main goals in 2021. Scroll through your product reviews, product photos shared by users, blog comments, and social media posts. Encourage your clients to use an official hashtag so you can easily find their posts.
Reviews and testimonials can help increase the traffic on your website, thus leading to more conversions. Encourage your patrons to leave a review on your social media platforms and on your website. You can offer them a promo code that they can use for a discount on their next purchase.
Video content is another form of user-generated content that you can make use of. This not only helps you engage with your audience but also attracts more leads, as videos have been a popular advertisement choice for consumers.
9. Build a Strategy Based on Analysis and Not Tactics
Being creative and experimental with your marketing strategy can definitely pay off, but in 2021, you should build a plan based on data and not tactics. Keep an eye on your KPIs so you’d know what’s working and what’s not.
Experimenting with hacks and trends may pay-off after some time, but if you are not willing to risk not getting your return on investment, then it would be best to stick to tried and tested strategies.
Setting these tips up and applying them to your marketing strategy in 2021 will help you achieve a better return on your investment. Working with DevriX is a surefire way to do this, as we know the market well. We will make sure that we can cater to your needs when it comes to web development.
Marketing Assistance for Your Business
One of our core specialties as a part of our full-service suite of services is the Inbound Marketing package. If you need expert assistance in keyword generation and SEO, you should get in touch with us. We are a professional WordPress development company profiling in business growth for your next big challenge.