Where’s the ROI?

I found this good quote today regarding tracking the ROI from your social media efforts:

My response to the [social media] ROI roadblock is this – How does your boss measure the ROI of attending Chamber mixers, participating in Associations, and dropping in on networking luncheons? Done correctly, social networking on sites like Facebook is really no different – you don’t measure participation based on direct sales, you measure success based on identifying one potential strategic partner, acquiring one actionable bit of advice, or striking up a conversation or two that may eventually lead to developing a new customer. That kind of sounds like a set of solid networking objectives doesn’t it?ducttapemarketing.com, Small Business Marketing Blog from Duct Tape Marketing, Jul 2009

Read the whole article and tell me what you think. My two cents? This is spot on; it’s important to find something trackable before engaging in an social media activity, and then report on your success on an ongoing basis. Simply put, without trying, you won’t get to where you need to go.

Twitter

Why does email marketing often get overlooked when it comes to ROI? As most online marketers know, one of the highest ROI tools in their toolkit is email marketing. as a matter of fact, according to the Direct Marketing Association, in 2009 email marketing projected to generate an ROI of over $43 per one dollar spent. As a means of comparison the DMA puts the ROI of search marketing has less than half of that — not to mention the low ROI of direct mail and other traditional marketing efforts.

Today’s MediaPost article addresses a major shortcoming of email marketing: while it is good at observing certain behaviors, such as opening an email and clicking through to a website, it does a poor job of clearly displaying its long-term value.

Case in point: what’s the value of an offline sale of a product learned about from an email marketing message? An Epsilon study found that 67% of email subscribers have purchased products off-line as a result of an email marketing communication.

While it is harder to quantify the total ROI on email marketing, there are some easy ways to get closer to the true number:

1. Track offline redemptions. Give your customers a promo code (why not the phrase?) that they have to relay in-store.
2. Incentive your offline team. Let’s face it: if you can’t get your team to help you track the ROI, you’re not going to be successful. Tried to explain the value of email marketing, and how helping you track off-line redemptions properly will allow you to build better campaigns for them the future.
3. Marry your data. You don’t need a fancy CRM system to start — but you do need to leverage those in-store redemption’s towards improving your email marketing campaigns in the future. For example, if Joe Customer is on your email list and only responding to in-store offers, you need to get that data into your email marketing program so you can use it to segment your marketing list.

Email Marketing has an astoundingly high ROI on paper, and its harder to quantify properties make it even more attractive; as long as you put the proper tracking mechanisms in place,  you should be able to show a strong return on your investment.

Email Marketing