March 4, 2015 Nitesh Pednekar

How to Measure your Content Marketing ROI

SMARTe-Measure-Content-Marketing-ROIIt is vital to analyze your content on an on-going basis to maximize the output that it should normally achieve. There is no as such in-built sheet that can justify the returns on your content marketing efforts. But, you must be having some form of returns set for each of your campaigns that can be used to decide an overall content marketing ROI. To realize the content marketing ROI influence on your business, let’s start by calculating the investment. Then, calculate the return and use these numbers to find the ROI.

Here’s an example which will help you understand better:-

Calculate the “I” in ROI – Investment

At first, multiply the hours per month required to create the content by the hourly pay rate of the employees, freelancers or agencies used to generate content. Then, multiply the result by the overhead factor. This includes rent, utilities, etc. and is often 50%. Thus, a $20/hour employee is really a $30/hour employee when overhead is factored into the equation. Now, consolidate and add all other related costs like design fees, hosting fees, subscriptions, software, etc. Allot them to a specific content marketing campaign or amortize them monthly and spread the costs evenly across each content campaign.

Calculate the ‘R’ in ROI – Returns

Now take your leads per month and multiply them with your lead conversion rate, average lifetime customer value, and average profit margin. Suppose, you amass 25 leads per month from your website (captured from your web lead form, marketing automation, CRM system, etc.). At a general 20% lead conversion rate, you should be generating five new clients. Assume a $3,000 average lifetime customer value and a 30% average profit margin.

Calculate the entire “ROI”

Don’t just stop here now! Try to figure out whether you have spent your money well. To do that simply deduct the investment from the returns. After you have done that then divide it by the investment.

For using this measurement strategy efficiently, you must:

  • Track everything over a long period of time
  • Take note whenever anything changes like PR coverage, website updates, or new product launch
  • Trace multiple revenue data points, including total leads, new clients, total revenue, etc.
  • Look for arrays that indicate your content is working, e.g., “When revenue increases, content consumption and sharing metrics also increase.”

Using such a parallel approach isn’t an exact rocket science. But it idyllically gets content marketers past doing nothing at all, making it an important and viable substitute.

Note:- Please feel free to make suggestions and/or comments

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