The business world has plenty of rules, and when it comes to marketing, one of those rules is that you can’t manage what you can’t measure. Many companies struggle with this in two ways: their marketing teams may fight the notion of demanding financial returns on marketing dollars, and they may not know how to measure those financial returns in the first place.
Let’s say, for example, that you spend $10,000 on a Facebook marketing campaign that results in only 100 likes and no noticeable change in sales. Is that the highest and best use of your shareholders’ money? Maybe. Maybe not.
Convincing your marketing team that marketing results are worth measuring is a matter for another day. First, you have to figure out if your marketing is working. Here are a few ways to measure your results.
Content marketing is the act of creating valuable content that can be shared in an effort to obtain customers. It can range from blog posts and articles to white papers or even just press releases.
Measuring the success of content marketing is relatively simple because most of this data should be readily available via Google Analytics or whatever software you’re using to track website traffic. Specifically, you want to look for three things:
- A measurable rise in your search-engine rankings
- A measurable increase in the number of first-time visitors to your website
- More “likes” or “followers” (Facebook for example, has Page Insights)
There is one other thing you should look for: conversions. A conversion happens when a website visitor turns into a paying customer. That is, after all, the point of marketing: to sell things. A good content marketing strategy increases conversions.
Print and Online Advertising
Print and online advertising generally consists of paying to place advertisements for your business in newspapers, magazines and on websites. It’s very important to decide in advance what your goals are for this kind of marketing. Some businesses, for example, use this marketing tactic simply to build brand awareness and legitimize themselves. Other businesses want nothing but sales (e.g. sales of a new product, sales during a certain time, sales in a specific market, etc.). These goals determine the look and message in each advertisement.
If your goal is to build brand awareness, there are several tangible measures. Are more people talking about your brand on social media? Use your analytics software to find out. Are your retail stores experiencing more foot traffic? Make sure you’re counting that. Is your website getting more traffic, and is your company’s Facebook page getting more likes? Are people clicking on the ads on your website? Are they spending more time on your website or searching for your site? Again, your analytics programs can tell you all of that.
If the goal is to drive sales, the measurement is a little simpler: analyze your revenues during the ad campaign’s duration. In other words, if your advertising is working, you should be selling more. Not all advertising has an immediate effect, however, so if your goal is to increase sales, be sure to use a realistic time window. Coupon and promotional code redemption rates are also good evidence.
Search Engine Marketing (SEM)
Nowadays, if you want to grow your customer base, you’ve got to know how to do business online. And if you’re doing business online, it’s critical that you rank high—really high—in search engine results. According to one study, 75% of users never scroll past the first page of search results, and 60% of users never go beyond the top three search results. This means that if your company is fifth or sixth on the list when a potential customer does a Google search for a product you sell, you’re very likely not going to get the business. And if you don’t show up on the first page of search results, you’re in even worse shape.
Search engines such as Google use a complex set of proprietary algorithms to categorize websites based on keywords, which are terms that describe the content on a webpage. Search engines analyze webpages and index them according to their keyword patterns. Search engines also analyze the links in your webpages, both the sites you’re linking to and the sites that are linking to your page.
There are different ways to maximize your website’s findability, which is the essence of search-engine marketing (SEM). There are four major ways (and a lot of minor ones) to conduct SEM:
- Use pay-per-click ads
- Pay to be listed in certain directories
- Manage your online reputation
- Linking your website to other websites
Again, your web analytics program is your friend when it comes to finding the data that can tell you whether your efforts are paying off. In general, good SEM has a few major measurable results: higher search engine rankings, higher traffic coming from your pay-per-click ads or the directories on which you’ve paid to list your company, and fewer complaints over a certain period of time. Pay attention to all of these metrics, but don’t forget to look at the one measure that really matters: sales.
A Word About ROI
ROI stands for return on investment. It’s an important measure in marketing because it basically divides the increase in sales by the cost of the marketing responsible for that increase. For example, a $10,000 marketing campaign that generated $15,000 of extra sales has an ROI of 50%.
Fifty percent is pretty good, but don’t let percentages control your marketing decisions. They can be slightly misleading. Consider, for example, that a $100 marketing campaign that generates $150 of extra sales also has an ROI of 50%. If all you care about is percentages, the marketing efforts that brought in the extra 50 bucks looks just as good as the one that brought in an extra $5,000.
Marketing is hard to measure, but it is important. In business, spending money that doesn’t directly or indirectly generate sales is not an investment: it’s a charitable donation. Charity is not a bad thing at all, but for most businesspeople, that’s not the intended use of their marketing dollars. That’s why insisting on knowing what marketing campaigns work and don’t work isn’t just a good thing to do. It’s an absolute necessity.