A Guide to Digital Marketing ROI
Nowadays most business owners want to grow their business digitally as people purchase most of their items online. According to researches, approx. 70% of people search about a company before buying products from them. All businesses from startups to enterprises, everybody wants to invest their money in digital marketing. If you want to measure return on investment online, a digital marketing agency helps you calculate the Internet marketing ROI. If you do not have any idea about ROI or how to improve it, then read this article to the end.
What Is ROI In Digital Marketing?
You can measure your profit and loss from digital marketing campaigns by calculating the ROI. The total calculation relies upon the money you invested in this. In this way, you can understand whether your money is worth what you are doing. If you notice a positive return on investment that means the digital marketing campaigns are giving more money compared to what you have spent on them. You can also understand which area of your digital marketing is not working as you expected. Consequently, you can analyze the problems and take steps to improve your business digitally.
How Can You Calculate Digital Marketing ROI?
The formula for measuring the ROI is (Net profit / total online marketing costs) x 100 = ROI. You have to subtract your costs from the revenue to determine your net profit. After that, you have to divide the net profit by your total costs. Next, you have to multiply that number by 100 to make that number a percentage. If you include the net profit calculation, then the formula is ((Revenue – costs) / costs) x 100 = ROI. For instance, if you have invested $3000 into digital marketing and earned $15,000, then you have to calculate your ROI in this way - (($15,000 – $3000) / $3000) x 100.
If you do not know about your net profit, then you can calculate Internet marketing ROI in this process - [(Number of leads x lead to customer rate and average order value) – cost for marketing] / cost for marketing = ROI. There are a few terms that you should know to calculate your ROI properly. The following are conversion rate, cost per lead, average order value, customer lifetime value, lead close rate and cost per acquisition.
Which Tools Can You Use To Track ROI?
Many startup companies use Google Analytics to track and evaluate their digital marketing efforts. It does not matter if you operate in the B2B or B2C sector, you may get help from Google Analytics. By using this app, you can track various things such as:
Bounce rate
Online conversions
Organic search, social media
Page views
Traffic sources, like Facebook and Google.
Get in Touch with Us
If you have begun a startup and cannot handle all these complications by yourself, then contact an experienced digital marketing agency that takes all responsibilities on behalf of you. To get professional guidance to grow your business digitally, contact High Five Media in OKC.
