Content marketing undoubtedly has the power to increase the value of your business. Yet, it is the effectiveness of the strategy and its execution that determines success and yields results. Because there isn’t a one-size-fits-all solution suitable for all businesses, it is vital to analyze each case individually.
Plus, although content marketing is overall more efficient and affordable than other types of promotion, it also comes with certain expenses. Budget managers are thus wary of and pay considerable attention to the content marketing ROI.
What is Content Marketing?
Content marketing involves using content to promote and market your enterprise. The goal here is to create and distribute premium, high-quality content that will allow you to attract new customers and retain existing ones, keeping people coming back to your website time and time again.
Content is basically anything that can be published online. Some examples of marketing through content include:
- Articles (like this one you’re currently reading!)
- Blog posts
- Content on social media
- Presentations/ slideshows
Content marketing may also assist with SEO (search engine optimization). SEO’s purpose is to make your site visible to search engines and easily found through them.
The best-case scenario here is: the search engines start “loving” your website so much that they move it up to the top of search rankings, where users are more likely to find it when conducting searches relevant to your business.
A fundamental aspect of SEO is to target keywords that appear in search results and obtain hyperlinks to your content from other successful websites.
Content marketing is a great way to achieve both of these things. The most appealing factor is that the inclusion of keywords is typically done in a very natural way.
Now that you’ve figured out the basics of content marketing, it’s time to get ROI into the discussion.
The Importance of Measuring Content Marketing ROI
ROI measurement will allow for deliberate and methodical resource allocation. It’s a reliable compass for the efficiency of your actions that help you invest your finances intelligibly.
In order to receive the funding you require, you should provide the management with solid and tangible performance data.
Theorization and abstract benchmarks detached from the business objectives will not persuade or encourage those responsible for the management of finances.
Communicate with them in their language and support your suggestions with pertinent data and numbers. If not, designing potent strategies could be restricted and delayed due to the insufficient amount of resources for implementing them.
Convincing and demonstrating that content marketing will generate more leads is futile unless you can prove the impact.
And for that, it is necessary to set up the metrics you will be able to test and give them value. The same approach applies to customer retention and building authority.
How to Calculate ROI: Four Simple Steps
Step 1: Estimate the expense of producing the content
To begin with, determine the general expenditure to create your content. It should include all costs associated with the production: designing, writing, audio, video, outsourcing, special tools, etc.
Step 2: Determine the cost of content distribution
Next, you must specify how much finances went into distributing your content. Take into account the total cost of brand advertising, tools, or any other services you used to develop and promote your content.
Step 3: Determine the amount of sales your content produced
The next step is to figure out the amount of revenue your content has yielded. Sometimes, this might get a bit complex because there’s not always a clear link between a particular piece of content, or a program in general, and a sale.
Metrics will be discussed later in the article. For the moment, let’s imagine that you already possess data on the total sales connected to your content.
Step 4: Calculate your ROI
The math behind calculating content marketing ROI is super straightforward. Start with your return, subtract the sum of investment, then divide the result by the same amount (of investment), and lastly, multiply the whole thing by 100:
((Return – Investment) / Investment ) * 100
This formula will represent your ROI as a percentage. Example:
- Return = $3,000
- Investment = $500
- $3,000 – $500 = $2,500
- $2,500 / $500 = 5
- 5 * 100 = 500% content marketing ROI
How to Measure Your Content Marketing ROI (Right Way)
Metrics to Use
One thing to be aware of concerning content marketing is its ROI won’t be instantaneous. It can (and, as a matter of fact, will) take a few months for the effects of your content marketing plan to become noticeable – and they might not even be that pronounced.
This is partly due to the fact that it’s just not possible for your marketing to make waves in a matter of hours.
Google may take months to react to the changes that you’ve made, and people might not be aware of your content marketing efforts until after you’ve produced a substantial collection of posts or other pieces of content.
Thus, you need to be cautious and patient when weighing the ROI for your content marketing.
With that being said, there are four main, standard ways to evaluate the return on investment for content marketing:
- Consumption metrics
- Lead generation
Let’s take a closer look at each of them.
How many people were exposed to your marketing content? That’s the central question you need to ask for each piece of content you create and distribute.
You can get the answer via Google Analytics, a Google app that delivers detailed information about your website and the traffic it receives.
Here are some key performance indicators (KPIs) for marketing content consumption:
- Unique visits
- Time spent on site
- Bounce rate (percentage of users who leave your website after seeing only one page)
- Downloads of your email-gated content
Marketing campaigns using content can guide potential buyers to lead generators that require contact information from people.
Later, you can use this information and make a potential sale. It is crucial to check both the total number of leads as well as those directly generated by content marketing materials.
The metric is quite plain and refers to the number of sales your business has performed since the introduction of the content marketing plan.
It is important to examine your conversion rates (how many people actually made a deal after mindfully considering it).
For instance, if a customer places an item purchased from your website in their shopping cart and then proceeds to buy it – it’s an actual conversion.
However, if you’re a B2B company, you might want to contemplate making contact or lead from a conversion instead.
Social media sharing is easy to monitor; however, determining its dollar value can be tricky, making the ROI from sharing somewhat subjective. Nonetheless, social media is an essential aspect of content marketing as it opens your business up to an audience that isn’t there yet.
Metrics To Avoid Relying On
A lot of marketers examine their website’s impressions, traffic, and engagement to estimate their return on investment. Even though these metrics may be pertinent, they’re not trustworthy.
To determine their actual value, it is necessary to look at these measures in the context of other metrics: 500 “thumbs up” on social media may look great at first glance; however, if you contrast that to the reach of 10,000, those numbers won’t remain so impressive as it’s just 5% of the viewers who have to your message.
Instead of designing content marketing that uses engagement and traffic as the primary criteria, think about ways to integrate sales or lead generation into your content. For instance, producing your content as a gated asset allows you to notice and follow who’s engaging with it.
Challenges to Keep in Mind
- Early returns aren’t always the most reliable indicator: The majority of content sets out with a negative ROI, which then gradually improves as the content expands in volume. You must give your numbers enough time to adjust.
- It’s problematic to measure more obscure benefits: While it’s challenging to determine more subjective criteria like reputation and authority, these characteristics correlate with higher sales in general.
- Understanding the detailed data on the numbers: If you pay attention to numerous KPIs, it is challenging to gain a clear vision of your content’s all-around impact.
- Using irrelevant KPIs: You must concentrate on the factors that really matter when measuring ROI. Looking at the early data can cause confusion. For example, social media mentions outside of your target clientele might be insignificant to your return on investment (unless you plan to acquire a new audience).
How Much ROI to Expect
The percentage of return on investment will inevitably depend on your company’s needs and prior experience. If you’ve done offline marketing previously, which yielded little or no results, You may be satisfied even with a 10-15% ROI.
If you’ve run numerous content marketing campaigns and have seen impressive results, you may be discouraged if there is “only” 30-35% rise in sales.
The secret to achieving an adequate ROI from content marketing is to adjust your plan and objectives as you progress. Don’t anticipate identical outcomes for each content marketing campaign.
Stay cool-calm-collected, be adaptable, and keep track of your analytics to find out what works most effectively for your business.
About the Author!
Daniel brings life to writing by using the power of words. He is our fervent blogger who spends the majority of his time creating informative articles for StudyCrumb‘s blog. An authentic journalist, he’s joined our platform to assist students in writing essays that resonate with readers.
As a writer, Daniel has made significant progress since the time he wrote his first piece. The initial process of creating a compelling idea from scratch, gathering all the supporting details, conducting several interviews, and finally, writing a polished article, all in a short time frame, was a truly demanding task. But it was his determination and enthusiasm that led him to fascinating professional accomplishments. Currently, Daniel is here to share his wisdom about writing in a compelling way.