When talking about digital marketing, ROI is crucial for understanding which of the many actions you took are working: search engine optimization (SEO), Google Ads campaigns, content marketing and storytelling, email marketing and so on. It also allows you to compare investments among these initiatives, helping you to better understand which one is worth your money.
If the investment in a marketing activity does not produce a positive ROI, it means that the activity is generating losses, and then you should either make changes or invest that money in activities that will provide you with a greater return on investment.
However, while measuring ROI is easier for activities such as online campaigns or direct sales, it can be more complex for others such as Digital PR strategies, which rely on digital relationships to increase brand awareness.
What is the difference between ROI and ROAS? And how can I measure my ROI?
It is important to distinguish ROI from ROAS, which stands for Return on Advertising Spend. Indeed, ROAS only measures the effectiveness of advertising investments.
The formula for calculating the Return on Investment (ROI) is:
(Operating Income / Capital Invested) * 100.
Operating Income represents the profit generated by the investment.
To better understand the calculation of ROI, let’s consider this example: if we invest €1,000 in an online campaign that generates €1,500 in revenue, the ROI will be: (1500 / 1000) * 100 = 150%.
The formula to calculate the ROAS is:
(Advertising Campaign Revenue / Campaign Cost) * 100.
Measuring content marketing ROI: 10 metrics to consider
More and more companies are investing in content marketing, but assessing the ROI of their strategy can be complex. Here are some elements to keep in mind:
- Reaching the target audience: Define and track Key Performance Indicators (KPIs) such as unique users, traffic sources, traffic from referrals, views per page and average time spent on the site.
- Audience Engagement: Monitor users’ return to the site, average session duration, shares, comments and likes.
- Effectiveness of SEO activities: Monitor organic traffic, site ranking on keywords of interest, backlinks and site authority.
- Leads generated: Measure important conversion actions such as signing up for a newsletter or requesting a demo.
- Lead Engagement: Analyze lead engagement with emails opened, pages visited, articles read on corporate blogs or online magazines, and content downloaded.
- Conversations around the brand: Assess the impact of content on people’s engagement and brand perception.
- SEO value: Calculate the value of organic traffic using the formula: Total monthly searches * CTR * Value per visit.
- Value of leads: Multiply the number of leads generated by the traditional cost per lead (CPL).
- Single Touch Content Attribution: Use Single Touch Attribution (STA) to attribute 100% conversion credit to a single touchpoint in the customer journey.
- Multi-Touch Content Attribution: Implement Multi Touch Attribution (MTA) to evaluate the contribution of each touchpoint prior to conversion in the customer journey.
Content marketing: the long-term ROI
Content marketing is one of the most effective tools for generating traffic to a site, increasing conversions and, ultimately, sales. However, it is important to note that the ROI of a content marketing project cannot be evaluated in the same way as advertising campaigns.
In the case of an SEM or programmatic campaign, the focus is on improving CTR and CPC to optimize return on investment. On the other hand, in SEO and content marketing projects, it is essential to consider traffic in the medium and long term, and from different perspectives. A well-constructed piece of content today can generate a steady stream of clicks over time and bring value to the company in multiple ways, from increasing engagement to increasing brand awareness and generating qualified leads.
Whether you create your short-form or long-form content yourself or lean on a content marketing agency like Publicoos, you are not investing time and money in clicks, but in the production of the content itself. ROI is therefore more elusive.
In other words, a content marketing project can be compared to a good wine: if the initial quality is high and if it is given the right time and conditions to develop, it will continue to improve and increase in value over time.
