How to Track Your Digital Marketing ROI

/How to Track Your Digital Marketing ROI

This is the final article in our 4-part series covering the 4 Pillars of Effective Digital Marketing.  In case you haven’t been following along, the 4 Pillars are:

  1. Website Traffic
  2. Website Conversion
  3. Customer Value
  4. Tracking

That means we’re going to focus on Pillar #4 today, which is Tracking. Tracking is the “ugly duckling” in most businesses because it’s just not as sexy as Website Traffic, Website Conversion, or Customer Value.  Therefore, it’s often an afterthought or completely overlooked when launching digital marketing campaigns.

But like the other 3 Pillars, proper tracking is critical to digital marketing success.  Without tracking, you’ll never reach the full potential of your marketing and advertising.

Marketing ROI

Why Tracking Is So Important?

Just about everyone talks about how important tracking is, but have you ever stopped to really think through why it is?  Couldn’t you get away with only focusing on driving more traffic, more more conversions, and increasing your customer value to be successful?

The truth is no, you can’t, and here’s why…

First, you need tracking in place so you can identify where in your marketing campaign you’re losing sales.  In every marketing campaign there is a bottleneck, or weak link in the chain, where you’re choking sales.  It doesn’t matter how much you optimize, there’s always a weakest link!

As marketers, it’s our job to isolate this area and find ways to improve.  For example, with advertising, the bottleneck may be your ads (identified by low click-through rates) or it may be your landing pages (identified by low conversion rates).  The only way to know where your campaign is breaking down is via proper tracking.

Second, you need tracking so you can reinvest in campaigns that are generating ROI and ditch any campaigns that are losing money.  If you’re not tracking, then chances are you’re allocating your budget equally across many different marketing channels.

The problem with this strategy is that your campaigns are likely not generating the same ROI.  In fact, some are probably losing money!  When you’re tracking and analyzing the data, then you’ll identify these money pits so you can shut them off and reallocate your budget to the campaigns you know are profitable.  It’s amazing how much more profitable your marketing can be by simply adjusting your budgets according to profitability.

 

The 4 Tools to Track Your ROI

OK, hopefully you’re now convinced you need tracking, but what does that mean in practice?  Well, it means you need the following 4 tracking tools in your business:

    1. Website Analytics
    2. Phone Tracking
    3. Customer Relationship Management (CRM) Tracking
    4. KPI Tracking

 

1. Website Analytics

This one should be obvious.  You have to track how much traffic you get from all of your digital marketing and advertising campaigns.  Plus, how many of those visitors convert to leads via webform submissions.

The tool I use and recommend is Google Analytics.  It’s free, simple to install, and doesn’t require a 4-year college degree to generate and analyze the reports.  :)

I’ll admit, it’s scary when you first get started, but trust me, there are only a few graphs you really need to worry about, so it’s not overly complicated.

 

2. Phone Tracking

For a lot of businesses, phone calls are the preferred method to receive sales inquiries.  That’s because prospects that take the time to pick up the phone and call are typically further along in the sales process and more ready to buy than prospects that use an online contact form.

With that in mind, it’s surprising that many businesses do not use phone call tracking to see where exactly the calls are coming from.  Without phone tracking there’s no way to know if your advertising, SEO, social media, or other marketing is driving calls, which eventually convert to sales.

To set up phone tracking correctly you’ll want to use what’s called DNI, or dynamic number insertion.  This is just a fancy term that means your website will display a different phone number based on the source of the website visitor.

For example, a visitor who clicked on an AdWords ad would see phone number A and a visitor who searched and clicked on your organic listing in Google would see phone number B.  At the end of the month you can tally up all the calls from your unique phone numbers to see how your marketing is performing.

 

3. CRM Tracking

Now we’re moving into the more complicated tracking tactics.  A customer relationship management (CRM) system is simply a database to store your prospects, customers, and any other business contacts.  Popular CRMs are Salesforce, ACT, and Infusionsoft.  You can also use an Excel file or a Google Spreadsheet to get started.

Note that if you’re running an eCommerce business and all of your sales are generated online, then CRM tracking is not necessary because you can use your Website Analytics. However, non-eCommerce businesses make sales over the phone and in-person where website analytics can not help you.

CRM tracking is the process of documenting the source of all of your prospects in your database so that you can run sales reports per marketing channel.  For example, if you’re using phone tracking, then your sales team can document in the CRM system exactly where your phone calls came from. Then at the end of the month you can tally up all the phone call sales that came in from your AdWords advertising campaign versus your SEO campaign.

 

4. KPI Tracking

The 3 above are the tracking tools you need to measure the performance of your marketing campaigns over time.  The 4th, KPI tracking, is how we bring it all together into a concise list of metrics that give you X-ray vision into your digital marketing campaigns.

A KPI is an acronym for key performance indicator.  Any data point that gives you insight into your marketing performance could be a KPI.  As the business owner or marketing manager, it’s your job to monitor the correct KPIs and then make data-based decisions to improve your overall marketing performance.

 

Need More Help Tracking Your ROI?

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By | 2017-11-12T10:19:22+00:00 March 29th, 2015|Categories: Tracking and Analytics|Tags: , , , , , , |

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