Using Metrics to Determine Marketing ROI
Do you know where your customers are coming from? Can you easily calculate the ROI of your campaigns?
If you can’t answer these questions, you certainly should. Research indicates that 77% of CEOs believe that marketers are focused on the wrong things. The perception is that instead of tracking revenue and ROI, marketers are far too focused on things like brand equity and value.
It’s certainly not a flattering perception. It’s enough to make even the most data-driven marketer wince, really. Perhaps most importantly, a complete lack of ROI tracking is downright shameful in a world where access to user-friendly technologies is abundant. Fortunately, there’s a tool that can completely change how your leadership perceives marketing, even if numbers are your kryptonite: closed loop analytics and reporting.
What is Closed-Loop Marketing?
Closed loop marketing tells you how your customers found your organization. It tracks their journey from the first time they visited your website to their final customer conversion. It’s the practice of compiling a massive amount of data into easy-to-consume reports that profile your organization’s customers. This process is fully automated, so even the most math-averse marketers can turn into ROI-focused number nerds.
As marketers, we can benefit immensely from closed-loop reporting. By tracking our buyer’s journeys, we can determine the campaigns that are yielding the best results. It’s possible to discover whether your company’s social media or content efforts are most fruitful; and adjust your inbound marketing strategy accordingly.
If you’re bold enough to make the leap from implementing closed loop marketing to applying the intelligence, it can change everything. Closed loop reporting can completely revolutionize your company’s close rate, and allow you to better understand your ideal customers. Knowing your buyer personas more intimately means that each campaign you create closes more customers, and earns more revenue for your organization.
Benefits of Closing the Loop
Closed loop marketing may seem too good to be true. However, the benefits are well-documented, and touted by some of the sharpest brands out there. Adobe reports that brands that employ closed-loop marketing and reporting can see the following benefits:
- Increased conversion rates
- Lower marketing costs
- Improved customer experience
- Better lead management practices
- Improved ROI analysis
When you understand the campaigns, channels, and workflows that convert, you can focus your efforts on emulating these in your marketing. Instead of pouring time and resources into concepts your buyers couldn’t care less about, you’re able to refine your approach effectively.
The Importance of Closed-Loop Reporting
As marketers, we should all be tracking our customer’s referral sources, and drilling down the ROI of each marketing campaign we launch. We should be determining the social media channels, forms of content marketing, and email lead nurturing campaigns that provide the best results. However, crunching these numbers manually would be an exhausting task.
Closed-Loop reporting is really only possible with the right marketing technologies. Instead of trying to trace each new buyer’s path towards becoming a customer, your software can track each click, CTA conversion, and email opened. This massive volume of data is summarized, compiled, and turned into marketing intelligence you can apply in real-time.
Besides, closed loop marketing works for everyone. You can apply these technologies even if your company has a complex, multi-channel approach to customer acquisition. It’s possible to drill-down success rates in your reporting even if you have multiple buyer personas, or an extremely wide range of products.
What to Do With These Insights
Most organizations never revisit their buyer persona profiles. They draft up profiles of their ideal customers, and assume they’ll remain stagnant. This can be a downright dangerous approach, even if you’re marketing within a very well-defined vertical. Consumer habits change drastically. 5 years ago, who even owned a smartphone? It was definitely a select few, instead of the major cultural phenomenon it’s become today.
Closed loop analytics should be first and foremost a tool for continually refining and adjusting your buyer personas. Instead of basing your customer profiles off a few interviews, you’ll be able to apply insights from your entire website visitor base to your marketing. You’ll discover actual data about how your customers engage with product research and sales. It’s crucial to fully embrace this new knowledge.
Closing the loop will also provide you with the opportunity to see some real weaknesses in your marketing assets. The social media posts and workflows that simply fail to lead to paying customers? These should be subject to careful assessment, and probable revision. Closed loop reporting is a powerful way to learn what’s working, and where you need some serious improvement.
There are virtually no downsides to deciding to close the loop. In fact, this inbound marketing tactic can completely revolutionize the way your organization does business. It’s a crucial way to really understand your customers, and where your revenue is really coming from.
Have you closed the loop on your inbound marketing? How have you applied the results?