Increasing your marketing ROI (return on investment) happens when you boost your ROI by increasing your income, decreasing your costs, or both.
As long as you have a positive ROI and earn more than a dollar for every dollar you invest you are in a positive position and are poised for growth.
The higher your ROI the easier and faster it will be for you to scale your marketing and sales.
The shocking truth is that often ROI is often not even calculated, as the infographic below about social media marketing ROI reveals.
So what can you do? First of all make sure you track everything related to your marketing spend, so you can find out your ROI and determine what works best.
Then put the tips below into action so you can boost your ROI and improve your profitability! 🙂
1. Focus on Increasing Your Income
Although decreasing costs can improve ROI by taking action to increase your income you will give yourself the greatest potential for growth.
Seek out ways to increase your income by investing time and money into setting up profitable systems so you can see significantly better sales down the road.
“Sales Cure All. Know how your company will make money and how you will actually make sales.” ~Mark Cuban
Income is vital for the survival of a business. With plenty of income a business will have plenty of options to scale, but without income a business will stagnate and fail.
2. Become Obsessed With Powerful Metrics
Analytics will reveal where the most profitable parts of your business are.
Use unique URL’s for every promotion channel you launch so you can identify your best performing campaigns.
One way to track clicks is to use a link shortening service like bit.ly. To get analytics on any bit.ly link simply put a + at the end of the link and that will give you in depth info on the origin of your traffic.
If you are a webmaster Google Analytics is a must. For those with a self-hosted WordPress blog there is a free plugin called Google Analyticator that makes adding analytics tracking code into every page a breeze.
Ultimately the metrics that you measure are likely to improve, so set aside time to geek out with your data so you can find ways to optimize the metrics that matter most.
3. Raise Your Prices
Recently I was listening to a podcast with Marc Andressen (A silicon valley legend who sits on the board of directors of Facebook, eBay, and Hewlett Packard Enterprise, among others) and Marc was asked “If you could put a billboard anywhere in the world where would it be and what would it say?”
His answer: Marc said would put a billboard in Silicon Valley that said “Raise Prices.”
Raising prices is Marc’s #1 startup advice since it creates pressure for a product to be of a high enough quality to justify the increased price, and it helps provide the capital a company needs to grow.
My thoughts on raising prices are that it will lead to better, happier, customers.
Many customers feel that “you get what you pay for” so when they pay more for something this helps them realize more of the value in what they bought.
4. Identify Your Core Metrics
What metrics matter the most to your business?
Take into account that all traffic is not created equal. Targeted traffic to your sales pages will move the ROI needle far more than traffic to elsewhere on your site.
Dig into your data and discover what is working best: Then find more ways to make it work even better.
One powerful way to do this is by looking at the posts on your blog that are almost at the top of Google for your focus keyword, and then building quality back links until your content is #1.
Of course page 1 of Google search results is where the vast majority of the traffic is, as the graphic below illustrates.
5. Experiment & Analyze
“Insanity: doing the same thing over and over again and expecting different results.” ~Albert Einstein
Experiment with different channels and campaigns to discover what works best for your business.
Some channels to use and test include:
- Social Media
- Digital Advertisements
- Content Marketing
- Direct Mail
6. Use Coupon Codes
Coupon codes are a great way to get people to take action, and track what channels are performing best.
Use a different coupon code for each promotion channel so you can analyze which channel delivered the highest ROI.
7. Leverage Automation
Automation can enable you to achieve efficiency and maximize ROI by getting software to do the heavy lifting.
One of my favorite forms of automation is an email auto-responder through a service like Aweber, which can deploy an email sequence at intervals that you specify. This can be a great way to add trust and build value with your audience on autopilot.
Even simple automation tools, likes scheduling posts for social media ahead of time, can help you take advantage of these platforms without having to invest a ton of time every day.
8. Use Video
The average person receives more than 84 emails per day. One way to separate your emails from the herd is to embed video.
According to Experian, embedding a video in emails can increase your conversion rates by 21 percent. The same study revealed that click rates improve up to 13 percent when marketers include “video” in their subject lines.
Facebook reports that 100 million hours of video are consumed on Facebook each day, so you should definitely be using video there as well.
To optimize make sure your videos feature text early on since often videos will be played with the sound turned off so text can be a compelling way to capture attention and get people interested in the video.
9. Do A/B Split Tests
A/B tests are a great way to compare two different elements of marketing and determine which one works best.
Running an A/B test compares a variation (such as a headline) against a current experience so you can collect data about the impact of that change.
Doing A/B experiments enable you to use data to determine the best ways to optimize your marketing funnel.
Google Analytics calls tests like these content experiments because often tests will involve many different variations instead of just two.
By performing experiments that improve your conversion rates you will be able to move more people through your funnel and increase your marketing ROI.
10. Use Powerful Marketing Software
Marketing software can take your marketing ROI to the next level and give you an edge over your competition.
Just a few of the software tools I use to boost my marketing ROI include:
- Aweber (Email Marketing & Autoresponder Software)
- Hootsuite (Social Media Management Web App)
- Tweet Jukebox (Twitter Automation App)
- WordPress (The Best Website Platform for Marketers)
- Bluehost (Quality Hosting for WordPress)
- Dropbox (Cloud Based Auto Backup File Storage)
What Determines a Good ROI?
Whenever your ROI is positive that is a good thing. A positive marketing ROI is when for every dollar you spend you get more than one dollar in return.
An example of a great ROI is $15.82 for every $1 spent. This feat was achieved by IBM, according to a recent report by Nucleus Research.
According to the Nucleus Research report IBM was able to help their clients achieve this marketing ROI “by taking advantage of IBM’s investments in cloud and integration, enabling new lines of business, and delivering productivity gains through marketing automation.”
When your marketing uses automation to achieve operational efficiency and you implement systems for creating new business, you too can enjoy a great return on your marketing investment.
The better your ROI the more confidently you can reinvest in your marketing to scale up your business and your profitability fast.
What is your favorite tip for boosting your ROI? Let me know with a comment below! 🙂