ROI for digital marketing can be tough to understand and tricky to calculate. But doing both is essential to achieving the inbound marketing results you want. If you ever wonder, “How do I calculate my ROI?” or, “Does ROI really matter?” – you’re not alone. Check out our recent blog post on the subject, and you’ll be on your way to understanding how to determine your return on investments. And then there’s another piece of this puzzle that is often forgotten: feedback from your marketing agency.
Your digital marketing agency surely gives you some sort of year-end overview of how your work together has gone, but do they get into the nitty-gritty with you? If not, it’s up to you to ask them the right questions to get the conversation started. Here are a few suggestions…
1. How do the metrics your marketing agency is using tie into the results your sales team is getting?
There’s a common misconception that metrics are all created equal. But the reality is that the metrics your marketing agency uses to measure success are likely different than the ones your sales team relies upon. After all, it’s no secret that marketers tend to dream in volumes of leads, while salespeople salivate when a deal has actually closed.
So in order to make sure you’re using the same language and measurements, get both groups in the same room! Really… they won’t bite. Have a meeting about what numbers are important to your agency and to your sales team, and then define shared terms so everyone is speaking the same language. And finally, be sure you’re using closed-loop reporting. This is one of the only ways to be certain that your agency and your sales team are in fact seeing the same results.
2. What variables should be accounted for when reviewing the metrics?
When your marketing agency sits down with you for a year-end review of their work on your behalf, it’s easy to jump ahead to “the numbers.” Your executive team is busy, and you’d rather see the cold, hard figures then get back to work (or Christmas shopping…). But if you do this, you could be jeopardizing your understanding of the marketing ROI your business has experienced. There are actually numerous factors that can impact performance throughout the year – which are unable to be illustrated in numbers alone.
So when you analyze the year-end numbers, invite the context around it all too. Business seasonality or monthly changes in budget can greatly impact the results you’ve seen. You don’t want to make a rash decision about your marketing strategy based on numbers since the circumstances could paint a different picture. To be optimally informed, approach return on marketing investment like a human. And ask your agency to do the same.
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3. What has our cost per lead been, and why is this good or bad?
If you trust your marketing agency, it can be tempting to hand the reins over to them and keep yourself out of the weeds. But understanding your company’s cost per lead (CPL) should be on the top of your holiday wish list this year. It’s actually really important for you, the brand, to be familiar with numbers like this. Your agency should be able to tell you what your CPL is and whether or not it’s on par for your industry. If it’s higher than average, they should give you an honest answer about why that might be, and the same is true for if it’s lower than average. Even if you don’t want to be involved in the day-to-day work that your marketing agency does, you should feel comfortable with – and understand – specifics that impact your marketing ROI, instead of taking a backseat.
When it comes to your costs per lead, this is another area in which the numbers alone don’t tell the full story. While a vast number of leads might look good on paper, a smaller amount of highly qualified leads will translate into better sales. So even if your traffic and number of leads decrease, and your costs per lead increase, you might be generating better overall results. Be sure to understand the full scope of your cost per lead and these interrelated factors, so that your marketing ROI can be merry and bright.
4. What is the full picture of our sales funnel?
You’ve probably heard your agency speak in jargon, regularly using acronyms like “KPI.” Don’t tune this out! KPI is the abbreviation for Key Performance Indicators, and the term refers to the specific metrics a business uses to gauge success. If you ask your marketing agency about your brand’s particular KPIs, then you can better understand which parts of your sales funnel are effective – and which are not.
Once you know this information, you can figure out how to tweak your efforts to get the results you want. An example would be if you aren’t seeing the number of leads you want, the problem might be at the top of the funnel where not enough people are coming to your site in the first place. So yes, it’s your marketing agency’s job to stay on top of your KPIs and keep you apprised of how they’re stacking up. But it’s a good idea for you to be actively involved in evaluating these metrics as well.
5. How are we setting ourselves up for success in the coming year?
As December rolls around, your agency should give you a thorough analysis of the return on marketing investment that has been achieved in the present year. They should also present you with a plan for the coming year, and explain to you the strategy behind that plan. If certain results weren’t achieved that you had been expecting, ask your team how they intend to get those results in the coming year.
This should open up a discussion about the obstacles that may be preventing you from reaching these goals. Maybe your tracking isn’t setup correctly to properly measure marketing efforts, or maybe there’s an issue with your definition of success metrics versus your agency’s (as touched on in the first section above). Make sure you understand how your agency will improve upon the current year’s efforts and prepare to make the coming year even better.
Always remember: You’re the client in the agency/brand relationship. You have a right to ask these questions and receive thorough explanations. You should feel comfortable with your agency’s direction and plan for the New Year. If you’re not, it might be time to do some window shopping for a new inbound marketing agency. As always, we’re just a call away! Or stop by our office in Scottsdale at any time. We’d love to chat digital marketing with you and get you ready for wild success in 2017. Cheers!
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Jay, the CEO of StringCan, oversees strategy and vision, building culture that makes going into work something he looks forward to, recruiting additional awesome team members to help exceed clients goals, leading the team and allocating where StringCan invests time and money.
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