Calculating Marketing ROI : Do’s & Don’ts

I’m obsessed with marketing attribution. And you should be too.

If you’re not then there’s a good chance you are flushing cash down the toilet. Please take my advice: stop what you’re doing right now and work with your team to create paths to attribution for ALL your marketing activity.

In the past, marketers have been guilty of meeting ROI conversations with a weary head shake, a suck of the teeth and a, ‘Well, it’s nearly impossible to work out.’

Difficult? Yes. But impossible? Absolutely not.

Here are my very simple do’s and don’ts for marketing ROI and attribution:

1. Do… Monitor EVERYTHING online: Digital channels offer unprecedented analytics and while at times you might feel like you’re drowning in data, remember all you’re really looking for are trends and patterns.
2. Do… Test: If you have the luxury of time, set up sample campaigns. This is especially useful for traditional media. Before you shell out the big bucks, do a smaller campaign on which you can measure ROI. You can then apply this calculation to a larger more expensive campaign. It’s not an exact science but, done well, is usually pretty accurate.
3. Do… Understand success: There are different schools of thought on this but I maintain that a piece of marketing has done its job if it has enticed a customer to seek more information (usually on a website). Rarely does a customer commit to buy purely off the strength of one 30 second TV ad or a small display ad. Yes, of course we want them to complete their transaction but understanding where the effect of your marketing piece ends and your onboarding/web UX/pricing strategy begins is crucial.
4. Don’t… Forget the ‘user’ factor: It drives me crazy when marketers write-off a particular channel or platform prematurely. I once had a marketing manager tell me flat out that SEM ‘does not work’, but on further inspection the keyword strategy that had he had put in place was very shaky. A huge variable when calculating ROI will be how effectively you, the user, executes on that particular channel. That being said…
5. Don’t… Linger: If you’ve followed best practice, if you’ve tested, if you’ve been as effective as you think you can possibly be but results are still poor… get out and get out fast. Side note: Adversely, make sure you double-down on the channels and platforms that are working.
6. Don’t… Set and forget: What is effective now could easily stop being effective in the future… and very quickly. Calculating ROI and working on attribution should be part of your ongoing marketing cycle.

I cannot stress the importance to young marketers of understanding what parts of a campaign are working and what parts are not. As you fine tune and move your spend in a more agile way, based on testing and attribution, you will undoubtedly see the effectiveness of your work sky-rocket.

What is your advice when it comes to marketing attribution? Have you found a new way of testing or calculating marketing ROI? I’d love to know what you’re doing. As usual, let me know in the comments below. Thanks for reading. Oh and hit the little heart below if you enjoyed it…