Have you ever given any consideration to your marketing ROI? Do you take time to track conversions and understand which of your marketing tactics are major drivers for sales and leads? Although we all focus on some form of marketing to drive sales, not as many of us take the time to determine the right marketing structure to drive ROI. Here we look at the five critical components of marketing structure that help drive ROI.
1. Build The Foundation
Building a solid foundation begins with actionable business goals. Only your leadership team can define those objectives. From there, you can create marketing tactics that allow you to achieve those objectives. Everything in your plan should align with elements of the objectives, with activities/channels focused on achieving specific goals. If you find something that doesn’t match a goal, chances are you don’t need it in your marketing plan.
A strong foundation also accounts for every resource. Who and what do you need to complete your activities? Is it team members or something to be outsourced? Both require time and money. It’s important to justify the level of activity and people involved as a need to meet your business goals. Otherwise, you waste time and money. Some guidelines to follow when setting a firm foundation include:
A Realistic Marketing Budget
To identify your ideal budget, you can multiply 10% of your projected annual gross sales by your average transaction markup for a low budget or 12% of sales, adjusted for your percent markup for a medium-ranged budget.
Be more proactive by identifying potential obstacles that could stand in your way. Are too many unnecessary people involved in the process that add confusion or roadblocks? Are there resource challenges with your budget? What about the threat of rising production costs? Do you have enough people with the skills to manage projects?
Marketing plan ROI is always more difficult because it is often less tangible. Executives need to see measurable milestones that show them you are meeting their expectations. As a result, measuring your marketing plan ROI requires a bit of education to explain what can and can’t be measured. How can you effectively show proof of your success?
When you consider something like your content strategy, this often comes across as real pie-in-the-sky stuff to executives used to dealing with numbers. You know how vital effective content is to your SEO strategy and to drive more people to your social channels and website. These touchpoints are major contributors to your business growth. It is possible to explain how content helps meet those broad objectives. You can tie your ROI to other objectives using numbers you know to be measurable.
Your sales team, for example, should know how many leads they need from your website to convert the right number of sales to positively impact revenues. You need to measure how much traffic that takes and how many conversions that traffic generates. If you can point to the types of content used as part of your campaigns to drive that number of visitors to your website landing pages, you can create a clear path that demonstrates how your content drums up new business. In this case, it’s all about attribution to help demonstrate how the most successful pieces of content generated more conversions. Voila, you’ve created a connection and shown how content impacts ROI.
The next piece of the puzzle is your benchmarks. As noted above, you need to have a reporting strategy that demonstrates success with measurements that contribute to meeting broader goals. You can access data through tools such as Google Analytics to set benchmarks to measure your success. Tracking performance is key to proving and measuring ROI. If you haven’t tracked performance historically, now is the time to introduce it as a major pillar of your marketing structure. You need that baseline data to put tactics into context so you can set feasible goals.
Now, you’ll run into big challenges without previous analytics, and this calls for research. You need intelligence to set those benchmarks. But your marketing strategy is also difficult to devise if you don’t understand your audience’s needs. What do they measure their purchases against when it comes to product or service criteria? Where do they tend to conduct their own research before making a purchase? What channels do they favor? This research tells you the channels you’ll want to use.
Last, consider the less tangible metrics you might want to measure. For example, with brand perception you’ll need to set benchmarks based on online coverage, the share of voice, message pull through, mentions, drivers to your website, etc. Another might be customer satisfaction. In this case, you have to plan to run surveys to help get a sense of customer experience.
Keep in mind research involved in setting benchmarks is time-consuming and therefore impacts your resources and budget. In fact, having a well-defined budget makes it easier to set realistic benchmarks. They tie to the goals you’ve defined as necessary to keep the business moving forward and the expectations set for your marketing channels. This helps you decide how much money you’ll need to throw at each tactic.
Therefore, every marketing plan requires a reporting budget and schedule. Your reporting budget keeps you up to date on what you planned to spend and what you actually spent, while your budget schedule is the frequency you plan to update and maintain your budget with new information on spending. As mentioned, everything needs to be accounted for, including time spent tracking your efforts, the tools required, outside resources, etc. Budget reporting is not just the money spent on actual marketing tactics such as pay-per-click or digital ads. In fact, you even should include the hours needed to follow up and track things like your budget.
Since you want to maximize ROI, monitoring performance is a must. Evaluation tells you how effective your campaigns are so you can continue to improve your method and approach. As you track performance, you can then improve your budget by taking money away from poor performers and investing more in your successful campaigns.
4. Be Accountable
Marketing accountability is the best way to measure and monitor your strategy to see where results are delivered. This is a key component to a great marketing structure and requires regular status reports to make sure your team is on track with your marketing plan. Accountability relates to both the financial and strategic elements of your marketing structure. When you are committed to marketing accountability, you are more likely to achieve better ROIs because you are focused on improving competencies.
5. Best Use of Resources
Managing resources is the final component of the marketing structure. If you don’t evaluate your resources accurately, it is more likely you won’t complete tasks as planned. It starts with scheduling project milestones and assigning resources to manage all related tasks. You can then measure progress at status meetings to determine if you have the resources to meet your goals on schedule.
Without resource assignment and reevaluation, you are more likely to find a growing stack of incomplete tasks. You’ll have nothing to show for your efforts. Breaking down projects into small bites assigned to your resources ensures you keep to your schedule, have enough resources and can more effectively and consistently meet your goals.
It might seem overwhelming to begin the process of developing a marketing plan. Hopefully, we’ve helped identify some ways to build ROI and accountability into your plan. If you need a little help building a marketing plan, we’re happy to chat.