Marketing can feel like a shot in the dark, yet there is a wealth of data available to the small business that can help you better tailor your marketing efforts to your goals. When you can use data effectively, you can optimize your marketing to achieve a higher return on investment. Unfortunately, many are unaware of how to use data to do just this, and they end up with a low ROI from their marketing efforts.
This is a mistake that costs your business money. According to McKinsey & Company, investing in and using those analytics successfully makes brands 1.5 times more likely to have above-average performance. Data-driven marketing is a key to success in the modern marketplace. This marketing ROI roadmap will help you know how to collect and analyze data and then use that to make decisions that improve your marketing ROI.
Calculating and Analyzing Marketing Data – The First Step in a Marketing ROI Roadmap
How can you know if you’re using your marketing dollars effectively? You must learn how to analyze your marketing and its return on investment properly.
Before you can decide if your marketing is effective, you must know what your goal for that marketing campaign is. Is your goal to drive traffic to your website, or is it to book new customers for the service you provide? Clearly define a set of measurable goals that you can use to measure your success.
Calculate Your Costs
Next, know what it costs to market, including not only the cost of the advertisements but also the costs to create those advertisements. Be thorough here, including costs for any software or tools you use in the process. Every dollar you spend on creating marketing material offsets the dollars you bring in through your marketing, so know what your spending is.
Consider All Marketing Channels
One of the challenges today’s marketers face is the multiple channels and devices their customers use to make a purchase decision. You must account for all marketing channels when gathering data about your marketing ROI. These channels include:
- Online search engines
- Social media platforms
- Digital advertising
- Maps and directory listings
- Reviews platforms
- Earned media, like radio or print advertising
- Email and text messaging
Not only do you need to find data about how customers are using these various marketing channels, but you also must track the effectiveness of your marketing campaigns across these channels to get an accurate picture of your ROI.
Choose the Best Data
One of the challenges the modern marketer faces is the vast amounts of data they can get their hands on. Close to 1/3 of marketers reporting to the Harvard Business Review stated there was “too much data to analyze” when attempting to optimize marketing efforts. Learn how to sift through the data to find the most critical tidbits you can use to make marketing decisions.
Count Conversions and Connect It to Revenue
Have a way to count conversions from your marketing efforts. Any campaign launched online should have conversion tracking attached to it. Tie that conversion tracking to your clearly defined goals.
Once you know how many conversions you had, connect those conversions to income. This is tricky if your goal is to increase brand revenue or generate leads, as these are hard to assign value to, so work with a marketing firm to help you determine the value of these types of leads.
Find the Difference
Take your total revenue gained from the marketing campaign and subtract the campaign costs from that amount. This will give you a dollar amount for your profit. Then, divide that by the costs and multiply by 100. This will provide you with a percentage to assign to your ROI.
Analyze the Results
Now that you have that percentage, it’s time to analyze it. If the ROI is positive, then you’ve earned a profit, but you should determine just how much profit you gained. For most brands, even those bringing in a solid profit from their marketing, there is room to improve.
Analyzing the results allows you to optimize your marketing efforts and make a change if you want better results. It gives you the data you need to justify those changes and also allows you to pivot when the needs and interests of your audience change, and thus, your marketing tactics need to shift as well.
Repeat the Process
Gathering and analyzing marketing data should be an ongoing process. While you can put tools in place to put this process on auto-pilot, you should constantly be monitoring your marketing ROI and finding ways to improve it when needed.
Proven Tips for Improving Marketing ROI
Once you know how to calculate and analyze your marketing data, it’s time to start improving the return on investment for the dollars you spend on marketing. Simply having the data isn’t enough. You must act on that data to make it an effective tool for your business. These strategies will help you make the most of every marketing dollar you spend.
1. Create More Targeted Marketing Campaigns
In addition to calculating your ROI, you can use data analytics to learn everything possible about your target audience and what works for them. When you know your audience, you can tailor your marketing message to them. Use data to make your marketing more personal to your target audience.
Today’s marketers have the benefit of real-time data that’s available to them. Real-time data can give you insights to pivot your marketing as soon as you notice a shift in customer needs.
2. Respond Quickly to Changes in Customer Behavior
To keep your marketing ROI high, make quick changes when customer behavior changes. Allocating your marketing dollars in real-time based on shifts in your market’s behavior will help protect your business from lost revenue due to changing ideas from customers.
3. Focus on the Right Metrics
There are many metrics you can gather as you analyze the data surrounding your marketing campaigns, but make sure you’re focusing on those tied to income. This doesn’t mean only focusing on sales, as lead generation is directly tied to income, but keep your analytics clearly connected to a measurable result. If a particular customer action, like opening an email and clicking a link, doesn’t lead to income, then don’t spend effort on measuring it or optimizing for it.
4. Invest in Multiple Marketing Channels
Since customers use multiple channels to research and buy from a business, you need to invest in multiple marketing channels. If you only focus on one or two channels, you will lose traffic and potential leads to your competition. Use social media, video marketing, SEO, paid advertisements, and offline advertisements, all with a consistent marketing message, to better showcase what your business offers. Use your data to analyze your customer’s typical journey to determine the best places to focus your time and money, and make sure you’re visible at every step of that journey to increase your conversion rate.
5. Test, Measure, and Compare
Once you have marketing in play, continually measure its effectiveness. If you want to make a change, test it to see if it works better. Make sure you compare your results to your competition, when possible, so you can see if your ROI is improving for your specific industry and for your specific goal.
6. Use a Marketing Intelligence Platform
Keeping tabs on marketing through multiple channels can be tedious and time-consuming, which can hurt your ROI due to increased labor costs. With a marketing intelligence platform like Surefire Local, you will be able to track data from multiple marketing platforms in one location. You will also be able to analyze conversions and oversee marketing from one location, so you can shift your focus as your customers’ needs shift.
Drive Growth Through Data with Surefire Local
As you prepare to maximize your ROI through better marketing and the use of the data gained through marketing, the right tools will make your job easier. Surefire Local is a business intelligence marketing software that allows you to manage your most important online marketing efforts within one platform. You can track data, optimize marketing, and evaluate campaigns, all within the same platform.
With Surefire Local, you can optimize your lead generation to reduce the amount you spend per lead. You can also optimize your marketing ROI, so you bring in more customers and revenue for your business. Because it is an all-in-one platform, you can do it all easily and from one central location.
Curious to see how it works? Attend a Surefire Local marketing platform demo to learn more and to see the software in action. Data should drive your marketing efforts, and Surefire Local makes it easy to use the data you have.