What Makes Up Your Content Marketing ROI?
Let’s get started by outlining some of the basic factors that go into creating what will eventually become your ROI measurement.
Most ROIs involve calculating your website’s Key Performance Indicators (KPIs), which are measurable values that illustrate the ways your company has, or has not, achieved your internal business objectives. Some common KPIs include:
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Website traffic
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Total leads generated
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Conversion rates
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Sales metrics
While leads and conversion rates are important for marketers to track, and website traffic is a good baseline to make performance expectations off of, it’s ultimately your overall sales and revenue metrics that are the most important factors to consider when working with ROI.
What you want to be looking for is a direct link between the amount of money invested in your marketing efforts and the amount of money earned as a result of those investments. For example, if your company sells lawn mowers and you share a free eBook on lawn mower maintenance that results in a spike in leads, you can track those leads to see how many turned into paying customers. If the amount earned from the paying customer surpasses the amount you paid to produce the eBook, then you have a positive content marketing ROI and proof that your audience is finding your content valuable.
Determining Your Investment and Profit
This brings us to the inception of all of your ROI results: the initial investment. Before producing content, you need to know what kind of investment you can devote to the content creation process. Understanding your initial investment means tracking how much time - and money - is spent in the process that leads to a finished, marketable product.
To determine your level of investment in a given piece of content, you’ll want to utilize some of the steps HubSpot outlines in one of their blog posts:
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Use a time tracking tool to learn exactly what your investment looks like
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Decide what specific metrics/investments you want to track
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Translate the time you've invested in a product into profit
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Measure the resulting ROI
That sounds like a lot of stuff to work through, but really, it can be condensed into three key categories: the value of tracking time, tracking metrics, and the translation to profit.
Tracking Time
Tracking the time you spend on a project is an often overlooked tool, but one that’s essential in understanding your eventual ROI. Without time tracking, you’ll never have a clear outline of how long a project takes to complete, making it difficult to decipher how much investment a given project is worth.
HubSpot recommends using Toggl for your time tracking needs, but a simple Google search will bring up plenty of alternatives, such as Clockify, Hubstaff, Timely, TimeCamp, and many, many more. Some of these are free-to-use, while others have fees for premium content tools. With the variety available though, you shouldn’t have trouble finding one that works for you and your company.
Tracking Metrics
Once you have all of your time tracking tools equipped, it’s time to calculate the “return” portion of your “return-on-investment.” This part has the potential to be tricky, so be sure to pinpoint what metric(s) you’re tracking so you know how to best quantify the measured metric’s impact on your content’s success, or lack thereof.
As an example, imagine that you’re tracking the number of purchases made on a sales page that’s linked to a call-to-action (CTA) at the end of a blog post. To do this, you’ll want to use your website’s analytics to track the click-through rate (CTR) of the CTA to the sales page. From there, you can see how many people made a purchase from the sales page, providing you with a clear definition of the profit made from the inclusion of that CTA in your blog post.
Translating to Profit
Once you know how much time you’ve invested in a project and compiled some meaningful metrics on it, you can begin calculating the actual profit that the content created for you. This is where things can get tricky, because calculating profit involves the tracking of multiple factors, such as:
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New visitors to your site
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New leads
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New marketing qualified leads (MQLs)
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New sales qualified leads (SQLs)
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New customers
Ultimately, the most important statistic to pay attention to is the number of new customers who have made a purchase with you. Once you know how many new customers you’ve earned, you’ll want to multiply that number by the average price of the product those customers purchased. This will give you an accurate representation of your profit, which you’ll then use to define the ROI for your content.
Calculating the ROI
At this point, you’ve tracked and cataloged a lot of information, and now it’s finally time to put it all to good use. There are a number of tools you can use to calculate your content marketing ROI, but in the end, it all comes down to a common foundational formula, which you can see below:
(Return – Investment)
Investment
This means that defining your content marketing ROI involves subtracting the original investment from the total return, and then dividing that result by the original investment. Your final ROI will be a positive or negative percentage, with a negative percentage - like -25% - showing how much profit you have lost, while a positive percentage - like +25% - will show you what percentage of your investment you’ve made back in profit.
With the right information, proper order-of-operations, and a basic grasping of math, you can find the ROI for the content you’ve created without an exhaustible amount of effort, and the benefits of doing so will far outweigh any potential inconveniences you might encounter.
Evaluating Your Content Marketing ROI
When you have an ROI percentage for your content marketing efforts, regardless of its positive or negative value, you empower yourself with the ability to grow and evolve your brand towards betterment and success. Your ROI doesn’t even have to be perfectly exact either; even a close approximation can give you the knowledge you need to decide what should come next.
If you have a positive ROI, then you know that whatever you’re doing is working, which allows you to devote even more of your time to your current content creation strategy. If your content is underperforming, however, then that can still empower you, because now you know that your content marketing strategies aren’t working and it’s time to start exploring other options.
Ultimately, measuring and understanding your content marketing ROI is a tool used for your own benefit. It can look intimidating, but in the end, it is vital for your marketing efforts as it highlights your successes and pinpoints the areas that need improvement with straightforward, persuasive data.
