How can you calculate the return on investment for video marketing?

Video marketing can be an extremely cost-effective way to promote your brand or product. It can also be an effective tool for recruiting new customers and building trust with current customers. There is no denying the role video marketing can play in driving website traffic and increasing ROI (Return on Investment). Industry statistics reveal that video marketing generates an average of 1.66 minutes of browsing time, resulting in a 71% lift in web traffic per dollar spent. Additionally, a recent study by Adobe demonstrated that video creatives outperform their static counterparts when it comes to engagement rates and click-through rates. In short, video marketing is essential for any business looking to increase web traffic and brand awareness.

To calculate the return on investment (ROI) for video marketing, start by estimating the cost of producing and distributing each video. Then determine how many people watched each video and convert that viewership into revenue. Finally, use that revenue figure to calculate the ROI for video marketing.?The formula varies between marketers depending on what they believe are direct or indirect marketing costs to be included in the formula. But this one is a very user-friendly version that can be interpreted according to our company's semantics.

Let's say that it costs a total of $4,800 to produce, place and run the explainer video over one month to reach a conversion rate of 1%. That means, if your video achieved 10,000 views, you will have onboarded 100 new clients in the month. Assuming a sale tag price of $5,000 per deal has been made through the new acquisitions, using the formula above, your ROI would be 942%.

ROI is usually shown as a percentage, but it can also be shown as a ratio. For example, if your ROI is?942%, you can express this as a ratio of 9.4:1.This is regarded as an outstanding ratio as it tells us that we will receive $9.42 for every $1 we invest in video content!

While this calculation is limited to the specific marketing cost breakdown of your particular organisation, it does provide you with a starting point for calculating ROI for your current or planned video content. This is very useful to know when making the decision to invest in video.

I would love to know what you are looking to achieve when investing in video. If you are open to talking about which ROI factors I can help you with or you just want to know more about how animated explainer videos can enhance your marketing strategy, please DM me or drop me a mail ([email protected]) to set up a ROI consultation. I would love to hear from you.