Recently the 2017 State of Inbound report came out saying that marketing’s greatest challenge is generating traffic and leads, followed by another that has appeared in surveys for years: proving the ROI of marketing activities. Remembering that: ROI = Net Profit (Investment Profit – Investment Cost) / Investment Cost. The truth is that when you do marketing based on metrics, on real data, on what you can calculate precisely, there is no difficulty measuring return on investments. I will explain why. Why proving marketing ROI seems like a challenge Even though it keeps appearing as an impossible task for marketing, proving the ROI of your actions is the vital way for professionals to understand the effectiveness of each marketing campaign in particular, each little piece of content. Besides that, proving ROI goes hand in hand with arguments to increase the budget: without ROI tracking there is no way to demonstrate profits. In other words, no ROI, no budget for marketing. The difficulty in that tracking lies mainly in the lack of clear communication between marketing activities and the sales team, as well as in the lack of professionals trained to collect, analyze, and understand real data. If even before management software it was already possible to arrive at these numbers, today what is enough is a bit of attention, time, reasoning, and determination to get there.
What you can do to calculate the ROI of your actions When it comes to delivering the ROI of each action, you need to recognize how much time and how many resources it will take to establish links between marketing activities and sales results. That means that both the marketing software (or even without it — “by hand”) and the CRM need to be tied together through a service-level agreement (SLA). There is no better way to see directly how many leads and conversions were generated from marketing activities than that. That agreement is controlled through specific methods and metrics that can guarantee that the audience interested in acquiring a given service recognizes the quality of the results obtained by a given company or entity that executes them. In other words, you and your client will have the definition of the results to be obtained, the execution time of the activity to be developed, those responsible for the activities and the involvement they will have, the tools that will be used, and the quality of the work that must be delivered. Your ROI will be the consequence of all of that, with actions measured in the system at each stage of the process. You add up all sales coming from the campaign carried out and subtract all costs of the same, such as, for example, sponsored links, email marketing, and social media. And then you divide the value obtained by the investment made. The calculation itself is simple. However, doubts arise when we analyze the costs included and those that are not included in digital marketing. This question varies from company to company, which is why it is so important to differentiate marketing work from sales work. One of the sector’s greatest challenges is not a challenge when you leave intuition aside and prioritize logical reasoning based on practical actions, visible consumers, and real results. ROI is only the beginning of effective results-measurement management. Other metrics, such as LTV, are equally important to outline your strategies and recognize the value of your clients.
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