One of the most important aspects of marketing is tracking. How do you know what campaigns work and what don’t? How do you know that what you are spending on marketing (time & money) is bringing you the returns you need?
Marketing without tracking is like playing darts blindfolded.
Tracking is not an afterthought. It is an essential part of your marketing that is implemented in the planning stages of the effort. Knowing the ROI of your marketing will allow you to better budget your money, your energy and your time.
Here’s a Pay Per Click Example of ROI:
PRODUCT SALES (in a month)
Number of site visitors from PPC = 1000
Number of site visitors from PPC who bought something = 20
Conversion rate = 2%
Average sale total for each purchaser = $40
Revenue per click = $40 x 2% = $0.80
Average profit total for each purchaser = $10
Gross Profit per click = $10 x 2% = $0.20
Your gross profit per click is 20 cents. If you are paying $1.20 per click, you are losing $1 for every new customer. Is that worth it for your business? Once again, knowing and tracking the activities of your customers can get you the answer. If 10% of your new customers wind up buying something from you again within a year and spend an average of $50. Is it worth it then?
SERVICES
Number of site visitors from PPC = 1000
Number of site visitors from PPC who became clients = 8
Conversion rate = .08%
Average Revenue from each client = $2000
Earnings per click = $2000 x .08% = $1.60
Here are just some of the questions every business needs to have ready answers to:
- Where do your customers come from?
- What are your customer retention rates?
- How much are they spending on the average?
- Why do you lose clients?
- What marketing gets you the best return on your investment?
These are just a few of the questions. What are your experiences with tracking?
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