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Show Me the ROI
Marketing is not just a line item in a budget. Marketing directly correlates with the success of a company’s products or services.
So why do some marketers struggle to secure an adequate budget for their campaigns? Why are these needed business activities such a hard sell…especially to senior leadership?
We often hear about great campaign ideas getting bottlenecked as they travel up the corporate ladder due to lingering doubts as to whether the proposed campaign is worth the investment.
In response to this feedback, we focused our latest client Siminar on presenting a results-based approach to campaigns.
Our presentation “Show Me the ROI” demonstrated how forecasting the impact of top-line marketing dollars can project bottom-line sales potential, making for a smooth and headache-free budget request. Here are some key take-aways from the discussion:
When preparing for your budget request, start by building a results-based campaign framework.
Avoid “vanity” metrics. Instead, select powerful key performance indicators (KPIs) to forecast what success should look like:
Vanity website metrics like “pages per visit” and “bounce rate” should never determine the success of a campaign. Instead, focus your forecast on key performance indicators, which are a series of quantifiable activities that measure progress towards goals. In isolation they don’t mean a lot, but when combined, they tell a story at each step of the sales funnel.
Each KPI should measure a conversion – for example, click-through rate (CTR) measures the number of people who convert at the awareness or top stage of your sales funnel (in this case, the conversion equals those engage with your advertising versus the number of people who are served your ad).
By measuring KPIs, you are able to tell a story about your marketing dollars being used on a results-based campaign focused on moving prospective buyers through the sales funnel, ultimately leading to a sale.
Monetizing the value of each prospective buyer enables you to track Return on Marketing Investment (ROMI):
The purpose of ROMI is to measure the degree to which marketing spend contributes to profits. By comparing the cost of your marketing campaign against the revenue potential of a prospective buyer, you can show senior leadership proof that your campaign will be worth the investment. Tracking this during and after the campaign can measure success.
Additionally, you can calculate the ROMI at different stages of the sales funnel and use the results to optimize your creative, content, channels and conversions in future campaigns.
When making your pitch to leadership, don’t forget to:
Keep your pitch informative but simple, measurable and realistic:
Marketers have countless metrics they can pull to stress the necessity of a project. But more isn’t always better, especially when it comes to data. Use only the numbers that really matter to the project at hand, and make sure that your leadership understands what those numbers truly mean.
Take the time to educate all involved, so that there’s a clear and concise vision of the campaign.
Share your ROMI forecast and connect to the key performance indicators at each stage of the funnel:
Senior leaders need to understand the necessity for each tactic in your request – from the media plan to website/landing page and content creation, it is important to communicate that investment in all tactics will lead to the whole being much more impactful than the sum of its parts.
Advanced organizations may be able to demonstrate a full attribution model. If this isn’t realistic, help senior leaders visualize the conversion path, step-by-step. If you believe that a positive ROMI is realistic, be confident about your plan and demonstrate your excitement about the campaign.
Sometimes the greatest challenge to a stellar marketing campaign is making sure it lives past the approval process. In order to get the green light, be strategic in your goals, use the right metrics, educate your company and stress the ability to optimize as the campaign progresses.
Is your company ready to launch a revolutionary marketing campaign? We can help you develop and execute the big idea or discuss ways to put your boss’ mind at ease. To talk business please email email@example.com or to delve deeper into this post, please email me at firstname.lastname@example.org.