How do you ensure your online marketing is squarely focussed on a return on your investment?

An online marketing services company often focuses on pay per click or lead generation, which works only while the ad runs and the ad spend keeps clicking over.

The real value of digital marketing lies in seeing the digital reach  and digital footprint grow as a whole, developing authority and brand capital. This is often through a multi-channel approach and includes cross pollination and strategy across business units, such as marketing, production, sales and finances.

An old school approach to return on investment or ROI for your marketing is as follows:nike air max 270 women’s sale nike air jordan mid wig stores adidas yeezy slide nfl shop free shipping best nfl uniforms adidas yeezy foam Human hair Wigs adidas yeezy 700 nike air max 90 white sex toys adam and eve male sex toys nike air max 9 5 nike air max womens custom basketball jerseys
If I spend $5,000 on my ads, and see $50,000 in sales occur, my gross profit is 10 x what I spent.
My net profit is then derived after all costs, such as raw materials, fixed costs, labour, fulfillment. That’s my ROI for marketing.
In the digital world, often people view SEM or PPC (pay per click) as the same equation. But is it that simple?

Not any longer. Any online marketing business needs to adopt a wider approach which incorporates a global view and multichannel approach. Internet purchase trends are no longer dominated by only early adopter, impulsive and FOMO (fear of missing out) buyers. Especially during COVID, we are all spending more time online and doing our research on who we choose as our provider of goods and services, on a wider range of needs than ever before.

Here are some of the factors affecting buyer behaviour

  • Global competition
  • Multiple sales platforms
  • Goods that don’t arrive
  • Goods not matching product descriptions
  • Buyer preferences for green and eco friendly
  • Online reviews
  • Multiple touch point impact on buying
  • Brand consistency

Understanding these factors is key in debunking the notion that ROI is as simple as running an ad campaign.

Why is Multi-Channel Marketing so Important?  

Google now reports that people view a business somewhere between 20 and 200 times, or touchpoints in their buying journey. It becomes important not just to have a single funnel or point of sale, but to nurture your client’s understanding of your services through a combination of channels, with end points for delivery to the client across business units and platforms.Marketing, Sales, Finances and Fulfillment all need to work together to find out the process that delivers the most profitable results across the entire business.

For example our online Marketing team delivers on consultation and strategy. Sales fulfillment for social media or SEO collateral is through another team, yet those assets typically lead back to the client’s business for appointments or purchase processes. Outbound calling is handled in person by us or our clients. Our division for online marketing in Melbourne handles social messaging for our clients. However at the point of purchase, our clients’ sales team or platform takes control. In reality it’s a bit of a spaghetti process, and it can look something like this.

In most businesses, sales, marketing, leads and profit start with a user that finds the business in several ways, and it can be the most common problem that a business faces – the challenge of knowing what a lead costs, how much it takes to fulfil and the actual profit margin per product in the business.

What are the Digital Metrics That Might Play a Part in ROI?

From a digital marketing perspective, there are many ways to measure ROI within a business, and here are some of the prevailing terms and their explanations.

  1. Unique Monthly Visitors (SEO metric)
  2. Cost Per Lead (SEM or PPC metric)
  3. Cost Per Acquisition (CPA OR CAC)
  4. Return on Ad Spend (ROAS)
  5. Average Order Value (AOV)
  6. Customer Lifetime Value (LTV)
  7. Lead-to-Close Ratio
  1. Unique monthly visitors
Simply put this is how many people visit your business online. The short list includes social platforms, your website and Google my business. The longer listing includes Bing, directory listings and other portals such as online stores (eBay or Uber Eats for example).


  1. Cost per Lead 
This is often mistaken for CPC – cost per click – which is a metric pulled from a paid ad campaign, which is determined by how much it costs when someone clicks from an Ad through to a landing page, or other action. However, actually it should be when a click results in an action that allows you to track back to the actual person. In this case they have entered their details into a lead form, or made an appointment, or even replied to an email.


  1. Cost Per Acquisition 
This is the cost of acquiring a customer. It could be related to emails, social posts, google or social ads, physical products such as flyers, billboards, or even sales people who have then closed the deal. It’s no wonder it’s hard for this metric to be truly tracked.


  1. Return on Ad Spend 
This can also be mixed up with ROI – Return on Investment. This relates to what it cost to set up, strategise, design and manage your ads, the cost of running the campaign through a media provider, such as radio, google, or social platforms, and the resulting leads per platform. So you might even need to consider the cost of video, consultant fees, or staff wages to get a campaign up and running.


  1. Average Order Value 
In our business we have around 130 SKUs. These different product lines all have a value; some have a time (service) component, some are a deliverable product. The average order value of our clients is often $2 – 5k per month, however your average order value may be under $100. One way in which to increase your profitability and return on investment is to add higher value products to an existing customer bundle, so that they can easily order more from you, an already trusted source.


  1. Customer Lifetime Value (LTV)
People often underestimate the lifetime value of a customer when they consider ROI. For example, if you are a dentist who gains a client for a clean from an ad, that client is then likely to repeat their clean in 6 months, have some dental work at some stage. Their lifetime value could be in the thousands. So it’s important to realise that clients come in once, but well looked after clients will stay a long time. A part played in LTV is also how well your follow up processes support repeat business, like loyalty bonuses, customer service calls, SMS reminders or offers.


  1. Lead-to-Close Ratio
In digital terms, we often know the CPC – cost per click, and with the right forms or actions we know the CPL – cost of turning that click into a lead where we know who the person is. Then we need to look at how many leads we need before a sale is done. That metric is known as lead to close. In some industries, this can be high, up to 90%. In others it can be only 10%.


If you’re finding this a little confusing, you’re not alone. It might be disappointing to know that tracking your ROI on marketing is not as simple as paying for a single ad and while we sympathise, we don’t apologise. A simple approach will no longer get the right results for a business in our current global market and we would rather you were well informed.

Hopefully you now have some insight into some of the ways in which a business should look at online marketing services and their ROI. If you have any questions around this topic, feel free to reach out to our Creative Director, Emma on +61 429 331 519 or call the office on +61 8395 3369.