What are the results that you are anticipating, does it make any difference? What profits would it bring? How can digital marketing improve ROI and so on. The most common questions that arise at the start of anything new or different. Doesn’t come as a surprise that adoption of digital marketing too is often hindered by those doubts, and more than often it lingers around the ROI on digital marketing.
While there are reasons/benefits persuasive enough to drive the adoption of digital marketing, ROI is still an aspect that often weighs it down. ROI in general measures the value earned in return to the resources that are put to use. But what does ROI stand for in terms of digital marketing? What are the resources being used and the expected outcomes? How are emails, social media, websites or other tools of engagement connected with numbers? What exactly are the metrics used for calculation? And how do those improve the ROI on digital marketing ? Here’s how.
How Can Digital Marketing Improve ROI
Bounce Rate :-
Let’s start with the most common term that applies for both emails and websites. In terms of websites it stands for the percentage of visitors visiting the website but navigating away just after viewing one page. In terms of email marketing, it refers to the percentage of email addresses in the subscriber list/database to whom the message isn’t delivered as a result of being returned by the recipient mail server. Bounce rate allows to keep track of what succeeds and what fails. Which in this case stands for functional and usable data, i.e. email addresses in the list, page design etc.
Hence, clearing out the inactive addresses and pages that lead nowhere. Also, higher bounce rate would indicate that the strategy isn’t working, which may be either due to use of wrong database or the email content being labelled as Spam, or issues with links in the web page. Rectifying issues at this level can ensure better results and hence the returns too.
2. Open Rate and Unsubscribe Rate :-
What goes wrong with the email campaign other than bounce offs? Either the mails go unread or lead to unsubscribes. An email campaign can only work if the emails are being opened.
Experimenting with various headlines/subject lines can help in grabbing attention, and hence improving the chances of lead conversion. Preventing the audience from being disinterested and unsubscribing requires more effort in the content creation.
3. Clicks & Click-Through-Rate (CTR) :-
Are emails being clicked on? If so, what happens when the users reach the next page? How many actually follow through the entire process? If the open and click rates do not ensure actual lead conversion, then ideally the campaign, website, landing pages etc. would need tweaking.
This applies also for digital advertisements. Clicks on the CTA points towards initial success, however it is the tracking done using extensions in the URL used for advertising that adds to it. With this data and tracking in place it becomes easier to analyze the cost/earning per click.
4. Leads :-
The real goal of digital marketing is to get leads and this includes the number of conversions earned on emails and replies, the list of regularly engaged subscribers. ROI here depends on the effectiveness of follow ups.
Apart from these the measurement of effectiveness of websites also depends on:
5. Actual Traffic Generated :-
This includes knowing in numbers the actual increase in traffic received from an advertisement or campaign.
6. Page Views and Behavior :-
A part of the analytics done for website views, this metric allows in understanding whether the campaign leads to change in user pattern, i.e. new page views or increase in time spent on various pages etc.
Time spent on page helps in understanding the average time spent surfing the website, pages that engage the audience more or less etc. Improvements in these aspects can necessarily improve the ROI too.
7. Unique Visitors, Returning Visitors and Converted Leads :-
For any campaign or even otherwise, keeping a close account of users visiting the website, and tracking those who come back again, helps in understanding the audience better. Such visitors are often prospective leads and hence the conversion rates often depend on how tailored the experience is when the user revisits. With AdSense, Business Intelligence tools etc. in picture this has become quite common.
Calculating the spend and ROI on digital marketing and the sales increase is the easiest way to determine whether the digital marketing campaign is successful. However, improving the ROI depends on how well the strategy is devised and how flexible it is to the changes based on the factors that influence it. The main reason why it usually takes an expert to do it right. If you are looking for help in digital marketing in Pune, we would really like to be of assistance.
Atul is Founder & CEO at Xenia Consulting. He has over 22 years of experience in marketing, across corporates as well as SME,start-ups. Over the last 5 years, he has gained significant expertise and has helped several companies drive growth leveraging digital marketing