Today, many businesses have gone beyond discovering digital. According to Statista, there will be more than 2 billion online shoppers around the world by 2020. So I guess it will only make sense that businesses that are looking to get a slice of the Two Billion shoppers pie have – at the least – started using one or more of the three most used digital channels (social media, website & email marketing)
Unlike the trend between 2014 and 2017, Management and Executives in Nigeria are appreciating the power that digital brings to the bottom line. However, many still do not quite understand how to effectively measure the impact to business. Just like every venture, if the benefit of any investment cannot be clearly articulated/defined, the excitement goes away overtime and one is sometimes left with the wrong conclusions.
If you’re a C-level decision maker, manager, entry level digital marketing executive or just a ‘curious soul’, this one’s for you.
In this post, I’d itemise some of the important metrics that can help you make sense of all the millions you may have invested in digital marketing – that will at least help you evaluate the impact (may not always be positive) to your business.
How Much Did I Make?
This question seeks to understand how much revenue (conversion in some cases isn’t currency based – e.g Leads) was generated from the marketing spend invested. Unlike traditional marketing, digital marketing often provides a sneak peak to this data. In the case that marketing channels are well integrated, it’s even easier to determine this.
To effectively measure Revenue, one must ensure that the business worth of each conversion action or sale is properly defined (e.g the average value of a lead is 1,000 Naira/Dollars).
By doing this, (and of course properly defining your conversion action + ensuring that measures have been taken to track them) you can easily get a clear picture of the sale/revenue/returns generated
Where Did The Monies/Conversion/Sale Come From?
In our experience, business owners tend to easily fall for the temptation to assume that certain channels or locations can deliver the highest conversion. This is sometimes not the case. Data from Digital channels provide clear insight on where the most sales is generated from. Thereby, enabling a business channel it’s resources better and will lesser (or no) assumptions.
In a recent campaign that we managed, the client’s brief specifically requested that we target some outlined channels. Infact, they clearly wanted their ads on some specific websites simply because according to them the managing director visits the websites and they’s love for him to see the Ads.
Although this may not be an outrightly bad thing to do, it’s generally not the best of strategies.
Back to the story – After several talks and what seemed like debates, we were able to convince our client to “cast their net wide” (i.e not limit themselves to their preferences but allow us to use as many channels as the results from our initial diagnostics suggested). Few weeks into the campaigns, things started getting clearer, while the impressions from their preferred channels were over the roof, the actual conversions (sale) were recorded from channels that neither of us assumed top three.
Just like your business is unique, your preferred channel may not always be the best performing.
Allow the data on location, placement, etc guide your decision on this
Who is My ‘Biggest Spender’?
Just like in everyday life, businesses want to put their money where they see more returns.
Knowing who your biggest and most consistent spenders are tell you who to target more and where your energy should be channeled.
Like the story on conversions, sometimes the people you assume to be your biggest spenders aren’t exactly the ones to focus on. Demographics reports provide insights on this.
With this information, management can better make decisions on strategy, creatives, marketing content, incentive models or loyalty programs that will best appeal to this category of users.
Where Are My Spenders Located?
Data on Location will help you invest your budget appropriately, thereby saving cost.
In Nigeria, it is generally assumed that every online marketing activity needs to focus on users in Lagos before other locations. However, our experience has shown that this doesn’t always have to be the case.
How Much More Did I Make?
Calculating the ROI or profit may be a little tricky and sometimes depends on the initial objective that the business setout to achieve.
In our experience, most businesses continue to struggle with this bit due to lack of marketing integration and automation. Most businesses have not effectively found a way to identify revenue generated from activities such as: offline conversions that resulted from online marketing. Some do not understand the difference between the actual cost of sale vs cost of lead generation, etc.
Until businesses figure out ways to effectively measure outcomes, ROAS & General marketing ROI will stay gray and sometimes undermined.
Finally, it’s important that businesses continue to seek growth by investing in and leveraging the growing digital trend; but more important to make sense of all the data you get out of it (well at least that’s what our Digital Analysts are here for).
We can help you piece it together and make sense of all that data you have.
Get In Touch! Let’s Get That Data Talking.