Decoding your Digital Marketing ROI Metrics

by Rajneesh Kumar Work is worship

Businesses are in existence primarily for commercial interests. Strategies and campaigns that are undertaken for specific purposes are intended to help fatten the profit margins, either directly or indirectly. This makes it important for businesses to measure Digital Marketing ROI Metrics and understand if the strategies are working or ineffective. In the knowledge economy, analysis and information are the drivers of success, offering businesses key insights that help to bring about transformation.

How to decipher ROI with metrics

Calculating the return on investment on a single activity may be relatively simple and uncomplicated. However, when an activity is intertwined with multiple other activities, it becomes challenging to separate the data sets and understand ROI. This becomes a lot more complicated when many there is an interplay of many factors. However, this can be achieved easily if the ROI of other aspects have been worked out prior to the latest activity.

A digital marketing campaign focused on converting prospects into customers of a specific product involves costs. Working out the total number of leads that have exclusively landed on the site due to the efforts of the campaign will indicate the cost per lead. The number of conversions of leads into actual sales gives the conversion rates from the leads.

You can understand the effectiveness of a campaign by working out the average customer lifetime value and the costs of attracting and converting per lead. This will give a near accurate picture of the ROI for campaigns. The total sales achieved and the total costs towards the campaign are high-level metrics which will not offer granular insights into the campaign and its effectiveness. The numbers are statistically important, but the most important criteria are the ability to make sense of the numbers and understand if the campaign is viable, considering the costs per lead.

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