Digital, social, and mobile technologies have dramatically changed the world we live in. And no function has been more disrupted than marketing. Executives won’t fund marketing if it doesn’t demonstrate real results. That’s why marketing ROI—including content marketing ROI—is one of the top challenges for CMOs and marketers. Social shares have no real value unless they drive engaged visitors back to your website. Ads have no quantifiable value unless they deliver leads or sales you can measure.
So before we can start to measure marketing ROI, we have to have the courage to stop doing things that don’t deliver real value. Stop creating content that no one wants. Stop advertising if you can’t measure click-throughs. Stop any marketing tactic that you invest in just because someone asked you to.
How are you doing? Still with me? It’s OK. We can do this together. Fearless marketers have the courage to stop investing in under-performing marketing activities and to start creating content that buyers want. And to invest in programs that deliver real ROI for the business. But how?
Let’s start with a definition of content marketing:
The difference between just any piece of content and content marketing is a destination you own, where you publish customer-focused content, with the goal of measuring value. Click To Tweet
Step 1: Build The Business Case
If you have don’t have a blog or resources section on your website, maybe you need to build the business case for content marketing to present to less fearless marketing executives.
I suggest you start by looking at your marketing ROI overall. When I hear the question about the ROI of content marketing, I always ask: “Well, what’s the ROI of your marketing overall?” And too often, I hear the answer: “We don’t know.”
Think about this: The majority of content discovered by your audience comes from just three channels: email, search, and social. Click To Tweet The best marketers focus their efforts on creating content that can be discovered across all of these. And what powers those channels? Of course, the answer is customer-focused content marketing.
Some questions to get you started building the business case:
- Do you rank for the keywords your audiences use the most?
- Do you create content that your audience chooses to subscribe to?
- Do you create content that actually gets read and shared?
If not, you can identify the business case as the potential to reach (organic search traffic), engage (social shares), and convert (subscribers and leads) buyers you would have never reached if you hadn’t done content marketing. You can find this data quickly using some available tools like SEM Rush, BuzzSumo, your website analytics platforms like Google Analytics, and your engagement platform. Then you can quantify the opportunity in the size of that audience you are NOT reaching.
Unlike campaigns that only achieve results while you are actively investing in them, content marketing requires a consistent investment over time, but you get increasing rates of return. This should be music to your CFO’s ears. It’s like a retirement account. Invest a small percentage of your budget over time. The first dollar you invest continues to deliver value to your brand long after the publish date. You compound those returns by continually making that investment.
If the math doesn’t convince executives, try tapping into fear. “Fear of loss” is considered one of the greatest human motivators. Executives are scared of being left behind their peers, and asking questions like the ones below are a great way to start the conversation:
- Do you show up first when someone searches for the category of your solution?
- Or does a competitor beat you on organic search?
- Does your competition create content with more social shares?
Step 2: Find or Reallocate The Budget
You don’t necessarily need additional investment to fund content marketing activities. Instead, just move budget from programs that aren’t working. You can find that using a campaign ROI report or ask yourself questions like these:
- How much content do we create that never gets used?
- Is the content we are creating driving leads and sales?
- How many marketing programs have delivered little or no leads or revenue?
- What do you spend on paid search because you don’t rank organically for those keywords?
Once you’ve identified the content and programs that haven’t worked, shift a portion of those marketing dollars into funding an annual, consistent content marketing program. Easy, right?
Step 3: Measure the Results
If the business case of content marketing is to reach, engage, and convert buyers. Then that can serve as a model for how to measure the ROI of content marketing.
The value of organic search traffic can be identified by looking at the average cost per click (CPC) you would have needed to spend in order to drive that traffic to your website or landing pages. Then simply multiply the CPC by your content marketing organic search visits.
If you get 10,000 visits from organic search and your average CPC is $2, that traffic is worth $20,000. This is a nice way to look at the value of reaching new customers, but you can’t take that money to the bank. So let’s look at something with real value:
Subscribers
Subscription rates are not only one of the best ways to measure the value and engagement of your content, but they also measure real value. You can quantify email subscribers’ monetary value if your email database has ever been used to nurture leads or present direct offers to sales/revenue.
To calculate the value per email address, take the total revenue from email campaigns and divide by the number of emails in your database. To calculate the value of subscribers, multiply the value per email address by total content marketing subscribers, and that’s the value of your subscribers.
If you generate $1 million in revenue from your email database and you have 250,000 subscribers, then each new subscriber is worth $4.00. Email is one of the highest producing ROI tactics marketers can use. And email subscribers are many times more likely to convert to real customers than non-subscribers. Click To Tweet
Leads
Many B2B marketers look to conversions and leads as the main objective of their marketing activity. For consumer marketers, they want to show actual revenue. One of the best ways to track this within content marketing is to define the customer journey.
For B2B, that should include the creation of mid-stage content offers such as a buyer’s guide, or webinars or event registrations to your annual user conference where sales can close all those leads. For B2C, we are talking about direct e-commerce revenue (L’Oreal’s Makeup.com is my favorite example).
Once you map content to the buyer journey, you will soon realize that most blog readers don’t immediately convert to customers. But if you offer them deep content to help them navigate their buyer journey, you can generate leads that ultimately convert to sales.
Retention
We’ve talked about the value of traffic, subscribers, and leads, but what about customer retention? Research has shown that a small investment in retention can deliver much higher ROI than investments in acquiring new customers. Click To Tweet But how do we measure this?
If you focus on subscribers, you can match customer email addresses with content subscribers. Then just do some simple math: How much more do subscribed customers spend vs. non-subscribed customers? How much longer do they stay as customers?
This is one of the best ways to demonstrate the value of content marketing. My clients who tracked customers who engage with their content marketing found these customers spend on average two to three times more and stayed three to four times longer than non-subscribed customers.
There is a formula for measuring the ROI of content marketing. But you need to be fearless. In short: Build the business case, find the budget, and measure the results.
For more on how to be a fearless marketer, follow Michael on Twitter @BrennerMichael or see his session on the Future CMO at Marketing Nation Summit.