ROI for Communication Pros is a three part series that will explore the basics of marketing and PR measurement and campaign tracking. In this final installment we share how to analyze your sales data to find ROI.
When a campaign is complete, the first thing you usually want to find out how well it did. Most CRM tools makes this easy with dashboards that showcase the campaign’s leads and subsequent revenue generated.
To truly get a good picture of your campaign success though, you will want to dig a little further into that and identify which tactics (social media, press release, advertising, etc.) helped generate the most leads. Doing that will require you to pull a report, which will likely be produced as an Excel spreadsheet depending on how your CRM is setup, or setup a dashboard that illustrates this more clearly.
What matters is you have an understanding of the following:
1. How many leads are generated by a specific campaign?
2. Over what period of time did those leads come in?
3. How many opportunities have been created and at what value?
4. How many of those opportunities have converted into revenue?
5. How long did it take for leads to convert?
6. Which sales divisions or representatives generated that revenue?
7. How many leads have not been converted into clients?
8. How many times have sales teams and marketing efforts touched a lead?
By answering these questions you can now identify how much money your efforts generate for the company and segment that data by campaign, month, quarter, or year.
Break out the following for each campaign or business period:
A: Number of leads generated = Marketing Qualified Lead (MLQ)
B: % of those leads that are qualified by sales = Sales Qualified Leads (SLQ)
C: % of leads converted to opportunities
D: % of opportunities closed
E: Revenue generated by closed opportunities
This will give you information to carry into a meeting with executives about a campaign’s performance. The majority of marketing or communications efforts have an associated cost in ad spending, costs of press release distribution or in agency associated expenses. If you know how much your campaign cost you can determine that campaign’s return on investment. A basic ROI calculation looks like the following:
Gross Profit – Marketing Investment
$100,000 (Gross Profit) – $10,000 (Marketing Investment
$10,000 (Marketing Investment)
Campaign ROI = 900% or for every $1 spent, the company generates $10 and $9 in profit
When they ask, “How did that campaign go?” you can respond with the following sentence:
“That campaign had an ROI of 900% and we generated $100,000 in new business.”
For your marketing team, the number of leads a campaign generated and percentage of conversion is very valuable information. Marketers want to know which tactics were most effective to help improve messaging or targeting in the future. You can represent this in a chart:
|Campaign Name||Leads or Revenue||% of Conversion|
|Marketing Qualified Leads||1,000||N/A|
|Sales Qualified Leads||200||20%|
|Lead to Close||1%|
With this data you can compare your activities against other departments in your organizations to better tailor your overall company efforts. For instance, a PR campaign with a higher ROI than a marketing campaign can help you argue for further investment in the future.
Pitfalls and Red Flags
The best laid plans can become your cement. Even with the greatest tracking in the world, things can break, mistakes can be made, and errors will happen.
Here are three common issues you may face:
1. The website will break. May be not the entire website, but if a form doesn’t work you won’t be collecting information from those who fill out their information. Ergo, no leads trafficked to your CRM system.
Fix: Test your forms before launching a campaign to see if your test lead is routed into your CRM. This will also let you know if your sales team is being notified that a lead has come in. Also, test important forms monthly to ensure each is operating properly.
2. Leads aren’t followed up on. The entire point of content marketing is to help a sales team find new people to pitch. If leads aren’t being contacted then they don’t make it further through the funnel and don’t get converted to closed deals.
Fix: Ask your sales team what is wrong with the contacts your efforts are bringing in. It might be that they are of the wrong seniority or they doesn’t know how to access the leads that your team generates. If you see something, say something and if you get feedback act on it.
3. The numbers don’t match: The data in your CRM doesn`t match with information provided by your finance department.
Fix: The data reported in a CRM will not always represent what is actually accrued by a business. An accounting department may accept payment and not update the CRM or the CRM data may be out of date when a report is pulled versus when your numbers are shared with another team. Because you have a list of which opportunities generate what amount of revenue, you can compare your numbers with that of your finance department. Side with your finance team`s numbers!
By bringing data to the table you can argue for more support, build a larger team and get more good work done. Want to learn more about how to prove your value as a PR professional, read our tip sheet today.