This video provides you with an extremely simple way to use Excel to track the ROI of your marketing, both online and offline. All you need to do is watch the video, download the provided spreadsheet and start trimming the fat from your marketing!
Download the Marketing Effectiveness ROI Tool Below:
Transcript: How to Measure Marketing Effectiveness
Here we have the basic online marketing funnel that we covered in a separate video and the components are obviously Reach, Engage, Convert, and Acquisition, which means to create a new client.
Just for a quick review in case you don’t have that video or have seen it lately, the goals for each phase of the online marketing funnel. With Reach, we want to generate the right traffic by being in the right places both online and offline. For Engagement, we want to engage visitors with the right message that we also covered in another video called The 5 M’s of Marketing, one of which one of the M’s is Message. To Convert, we want to convert more visitors to our site into qualified leads; and then finally the Goal of all this is to obtain more of the right target customers.
The tactics we used to that, well, for Reach, we used search engine optimization, pay-per-click, or even offline or other forms of advertising. For Engagement, it’s all about our web design, our blogs, content, and video, and components that we put in place to ensure that our visitors and target audience and customers stay around once they reach us. To Convert, we used offers, traffic magnets, things like ebooks or videos to give people a reason to contact us right now. We measure client acquisition with intake forms, trackable phone numbers, and nurturing. Those were the tactics that we used.
How do we measure the funnel? How do we measure that online funnel? In terms of measures regarding Reach, we looked at our search rankings. We also look at our website traffic. For Engagement, we look at time on site, paid views, or social shares. These are indicators of how engaged people are. For Conversion, we look at well, how many leads we generated? The web leads, the contact forms, or phone calls that were generated from our marking. Finally, it all ends and all filters down at the end of the funnel into appointments, bookings, actual sales occurring.
What we’re going to talk about today is one of the tools we can use to measure the funnel. The thing that we would use to measure reach online, well, we used a tool called Raven Tools or even a simple Excel spreadsheet. If you look to the left, we’re talking about measuring our search rankings. It’s important to know where we are. If I’m at a Mexican Restaurant in Denver, you’ll find them third page of Google for that term, I might have a much different amount of leads and customers than if I’m in number one.
In Engagement, we look at different metrics in Google Analytics. We look at the time on site or the bounce rate and the page views. We’re going to cover all this in a Google Analytics video later. This is just a template and overview and we’re going to dig into one tool to measure the return of investment for your marketing. Speaking of which, for Conversion, we might use email marketing software or a simple Excel spreadsheet that we’re going to use today. In terms of customers, you might have some elaborate intake forms or even software that you practices or brick and mortar business uses but that’s not important because either way, what is important is that you’re measuring your marketing and you know what the ROI is. In this video, we’re going to teach you how to scrutinize every dollar you spend on marketing and lump off those activities that aren’t producing ROI and do more of the ones that are.
Here I’m looking at a basic Excel spreadsheet that we created just for you to use in lieu of any of their more advanced tool that you might not have in place to measure your marketing. The bottom line is that you’re measuring a couple of simple metrics every month and you or somebody delegate this to in your business is looking at these and magic happens just by measurement.
Let me give you a couple kind of easy outs here that the most important thing is that you measure these things we’re going to teach you in future videos how to get the information if you don’t have them readily available. Don’t let another day, week, or months go by without measuring your marketing because you might be throwing money down the drain when you could be doubling or tripling the leads just by making a couple changes on looking at four basic numbers.
Again, this spreadsheet is right on this blog post in this article. If you’re watching this video on YouTube or another outlet on the web, go ahead and go to Geek-Free Marketing, register for this free marketing course and you’ll see this in the actual post. Hopefully that’s where you’re looking at this now. And don’t be intimidated by the number of metrics that are on this spreadsheet, it really only boils down to 4 basic metrics you need to measure and the rest are just computations for the nerds among us that want to scrutinize the details a little bit further.
The first four things you need to look at are really simple. Here along these top columns here, we just have the different avenues for our marketing. This particular fictitious business might be spending $750 a month on SEO, $500 on lawyers.com, which if you’re a dentist, that might be dental directory. There are directories out there in paid sources for any type of business. Important thing is I’m just writing down the monthly budget on spending to each channel on advertising and marketing and you see the totals here.
Now, the basic numbers to track is how many visitors each of these channels is driving to us. I’m not going to go into detail in Google Analytics here. We’re going to cover that in a separate video but you can easily look at traffic sources and see referring sites and you can see how much is your traffic came from natural search results, how much came from different websites that might paying to list your business on, and there’s even ways to track kind of lead forms and that kind of thing but that’s outside the scope of this. The important thing is that you know how many visitors came from there and you’re putting the basic numbers in place.
The most important ones though, even if you don’t attract anything else, is that you have your budget in place and you know how many phone calls, web leads, and the total number of leads you’re getting from each of those. Let me tell you why that’s important. I just put an arbitrary dollar amount for this fictitious law firm, say it’s a bankruptcy firm, of $3,000 for client value, the average client. If I got, let’s see, 10 web leads, total lead is 9, sorry, 8 phone calls, 1 web lead for 9 leads in two customers while the total sales were $6,000 from SEO. But just by tracking those basic four numbers, look what the amount of insight I have available. Now I know that the average visitor to my site that comes from SEO is worth $15 to me. The reason we’re looking at that in terms of value is because if I divide the number of visitors by the sales in our site, the average person that comes to our site is worth about $15. Why? Because out of the 400 visitors, two of those became clients. Now I know the conversion rate on that. We’re going to look at that below. See?
Now, per lead, I know that it’s $666 per lead. Why? Because if I got $6,000 in sales and I got a total of 9 leads, that’s what computation works out to, that’s pretty good to know because now I know that I’m willing to pay this much for a qualified lead to my site. The other side of the equation is the cost. I’m paying $1.90 to get every visitor to my site because I’m spending $750 to get 400 visitors. There’s a bunch of computations, you can look at these later once you start using the tool, I don’t want to go into the analysis and take away the attention from the important thing which is that you’re tracking these top four metrics. The bottom line is I know which channels convert better and what my return on investment is.
The important thing that I know right now is where my return on investment for my marketing is happening. I know that I’m getting an 800% ROI from SEO that I’m paying for 600% from this source and if I’m getting a very small ROI or none at all or even a negative ROI, maybe I have a lot of questions to ask that particular company I’m advertising with, maybe I want more tracking from them, maybe I’m missing some of the phone calls or leads and not giving them credit. I don’t want to make assumptions, but it’s going to tell me that I need to dig more deeply, into the lame ducks here, find out what’s going, and hopefully not, but if we do find that there’s truly a negative ROI and once I’m measuring this stuff, I’m going to cut this off and take this budget and spend it on the things that are working. If we do that over a time, just by measuring the return on investment for the different channels we’re using for marketing and advertising, magic happens.
This is the basic ROI spreadsheet. Again, it’s available right here in this article. If you need help in using a trackable phone number and what resources, look under the resource sections at www.Geek-FreeMarketing.com and there’s also videos available for real basic usage of using forms for your WordPress site or installing Google Analytics or any of the other tools that I mentioned here.
The bottom line is that every month, some of your staff is looking at a number of leads you’re generating compared to the cost of your spending and what the sales are in measuring the ROI. Thanks and have a good day.
How to Measure Marketing Effectiveness by Aaron Fletcher