What is the difference between a successful website and a complete flop? I know it sounds like the start of a joke but it really isn’t funny. The answer is the ROI (Return on Investment).

Topics to be covered today

1. What is ROI
2. How is ROI calculated
3. Optimizing ROI

This is probably one of my favorite topics because this is often times the topic that grabs my client’s attention the most. Goals and audience definition are incredibly important but unless you really get into it, the value isn’t always clear in the beginning. When we talk about ROI and a businesses “bottom line”, people perk up. SO PAY ATTENTION!

ROI is short for Return On Investment and it is a measure of how much return you got back from an initial investment. The higher the ROI the better the campaign.

ROI is calculated as follows:
ROI = (Investment Gain + Investment Cost) / (Investment Cost)

Investment Gain – What you got back from your initial investment
Investment Cost – The initial investment

Example:
If I spent $100 on a banner ad and because of that banner and I make $100 profit – my ROI would be 2.
If, on the other hand, I spent $100 on a banner ad on a different site and made $0 profit – my ROI would be 1.

An ROI of 1 is breakeven. so if ROI > 1, you made money. If ROI < 1, you lost money.

In the online world we will typically see ROI calculations for marketing efforts like:

• PPC advertising
• Display advertising
• Email marketing

But this isn’t all that we can calculate ROI for. ROI can also be calculated on indirect marketing activities such as:

• Web site maintenance/additions
• Lead generation
• SEO efforts (remember with SEO we are improving the site, not paying for traffic)
• etc.

The big key when optimizing campaigns to maximize ROI is to not make a lot of changes at once. In the online world we can usually see results quickly so make one small change at a time and see how it affects your ROI.

Items that you can modify include, but are not limited to:

• distribution channels (switch from Bing to Google to Facebook)
• modify ad headlines
• increase the number of posts to your blog
• the time of day your ads are showing up
• the market you decide to target (re-read yesterday’s email)
• etc.

The daily take …

1. ROI is a measure of campaign success
2. Calculation is a ratio total investment + profit divided by the total investment
3. ROI > 1 is good, ROI < 1 is bad
4. When optimizing your ROI, only make small incremental changes and track them (they won’t all be good)

If you have any questions about any of this please feel free to email me or call.

Topics to be covered today

1. Audience definition
A while ago I was starting a marketing campaign for a client and after a nice long chat about goals the question comes up .. “So who is our target market”?

The client answers, “Everybody that has a business”.

WRONG! Defining your audience is a crucial step in marketing (online and offline) and unfortunately, this is a step that most people never go through. They assume their market is everyone and they move forward without any precision in their campaigns. Lack of precision WILL result in lack of conversion.

Your audience is going to determine

• your keywords
• where you go to market your product/service
• how you position your product/service
• the product/services that are complimentary to yours
• and so on

SO … The more information you have about your audience the better off you will be able to address them and the problems/issues that they may be facing.

Things to look at when determining your target market are

• Geographics (location, climate, pace of life, etc)
• Demographics (age, religion, income, education, marital status, etc)
• Psychographics (attitudes, beliefs, emotions)
• Technographics (technologies used, etc)

Audience Definition Example:

Bad
All Businesses

Ok
Small to medium businesses based in California with annual revenues in excess of $1M

Better
Woman-owned businesses in the pet food industry, based in California with annual revenues > $1M. Organization size less than 10 people experiencing rapid growth over the past three years.

Can you tell the difference? When your target market is sufficiently defined you should be able to picture them in your head. Once you have this level of understanding of your audience – your keywords
will get better because you can craft them to appeal to a specific trait. With better keywords you will get more targeted traffic and with more targeted traffic – your conversion rates will be higher.

Sound simple? It can be if you practice.

I almost forgot – it is OK to have more than one target market as well. You just want to run through the audience profile for each one.

The daily take …

1. Audience definition will help you precisely target your market(s)
2. 4 areas to look at when defining your market (Geographics, Demographics, Psychographics, Technographics)
3. When properly defined you should be able to see a mental image of your customer
4. It is OK to have more than one target market

Coming Up … What’s up ROI? Calculating Return on Investment.

Over the past 10+ years we have been “fix-it” guys for a lot of web sites. These sites that need some repairs usually come with some pretty angry clients attached. In situations like this we really have two tasks – first we need to fix the problem and second we need to help the client understand what happened. Listen … not every web developer is a hack but there are a LOT of them out there. If you know the right questions to ask, you may just get lucky enough to avoid one of them.

The questions listed below act as a checklist. If you actually click on the links they will bring you to a deeper description of what to look for and what you should expect from a professional developer.

1. What do you think the most important aspect of my project is going to be?
2. What happens if I want to make changes during the course of the project?
3. Will I be able to make modifications to the site once it is done? What skills will be necessary?
4. Once the site is done and launched … Then what?
5. How long have you been doing this professionally?
6. What languages will you use to program my site?
7. Will you be migrating the content from my existing site?
8. Tell me about your testing procedures.
9. Who owns the site once it is completed?
10. Can you provide me with references from your last couple of projects?

As always, if you have any questions about any of the items listed above please feel free to contact me directly here.