Marketing ROI: The Ultimate Truth

Businesses have begun spending an inordinate amount on Marcom and media. Well, marketing deserves a good investment, but what matters more here is spending that money right.

More doesn’t always mean better. Marketing ROI is a buzzword, but it’s crucial to understand it’s subjective. It can mean different things to different people. This newsletter will elucidate what marketing ROI means for your business; we will lay it out for you in terms of your goals. Let’s begin!

Key Nuggets

Marketing ROI is measuring your marketing investment as to money or resource. Most marketers use ROI to analyze the effectiveness of specific marketing programs or campaigns, monthly or quarterly, and to gauge the overall marketing efforts annually.

Gone are the days when brands couldn’t attribute marketing to revenue. Though there are still some marketing components that show results in the long-term, you can tie most of it to revenue growth and sales.

You can’t consistently spend money on marketing without having to justify the impact. Here are some best ways to optimize your marketing spend and boost ROI.

Up and Running

- The first crucial step is to determine what’s worth your investment, and what’s not. As a team, you must prioritize the marketing efforts that are more profitable and give high returns

- All the budget decisions have to be data-backed and informed. Intuition is important in marketing, but when it comes to finances, trust the data

- Perform some competitive analysis to gauge how you measure up to your competitors and the key areas of revenue generation for them

- Calculating MROI

- If the ratio is too small, it shows high risk, and you may want to evaluate if the investment is worth the endeavor

- Usually, businesses have a fixed budget and have a clear picture of how much and when they are going to invest in marketing, but there are times when there isn’t a clear distinction between what to include and what to not. For instance, the returns on content marketing seem great, but a lot of time and effort goes into content creation

- In such cases, you may want to take a step back and notice if you scrapped this marketing element, what kind of impact would it have on sales?

Final Word: The Increment

Keep experimenting and performing A/B testing to study the increase in the revenue from marketing. Customer acquisition is not the only way marketing adds to the company’s revenue. It does it even more strongly with customer loyalty and retention. Even so, these bits are hard to measure; the impact they create is worth so much more.