22 April 2019

Effectively Measuring Digital Marketing ROI

Article  Marketing
main post

One of the best ways to measure the effectiveness of a marketing campaign is to measure its Return On Investment (ROI). ROI is the most widely-used profitability indicator; it measures the profit or loss generated by an investment based on the amount of money invested. The result is then used to make future financial decisions.

For the marketing executive, marketing ROI could be one of the hardest metrics to measure or to justify to the person who controls the purse strings. However, measuring marketing ROI is one of the key duties of a marketer, right up there with creating and running a marketing campaign.

Usually, marketing ROI is measured in comparison with Key Performance Indicators, set and agreed upon by the marketer and other key people overseeing a campaign. However, a major challenge marketers face is justifying their marketing spend in the aftermath of a campaign. A 2018 HubSpot Research reports that proving marketing budget is one of marketers’ top challenges, right after generating traffic and leads.

In digital marketing, measuring marketing ROI should be less complicated because more quantifiable data exists; one knows how many people clicked on what and how many impressions what post made. However, it appears that the availability of such data, for some marketers, has created a more complicated problem. Data is represented in many terms; clicks, impressions, clickthroughs, open and even for the best of us, it may be quite difficult to keep up with what all of these mean and translate it into the bottom line of the company: increased sales revenue.

While the digital marketing agencies usually measure results of campaigns in terms of raw data, the onus falls on both the marketing manager and the digital marketing agency to work out a system that not only shows numbers but what those numbers translate to for the product/brand in line with previously clarified Key Performance Indicators. It is also imperative that digital marketing campaigns are tracked and reviewed continually by both parties through the campaign lifespan and effective changes made to the campaign to help reach the brand’s marketing goal.

Tracking key metrics will help marketers better understand their marketing activities and how well they are performing. It will also give a sense of how much value those efforts are adding to an overall marketing strategy goal. Analyzing ROI provides a valuable guide on how to fine-tune digital marketing strategies, which can effectively put one ahead of the game.

Questions that keep marketing managers up at night are ''Did this marketing campaign deliver an adequate Return On Investment''? and “How do I measure the marketing ROI?” As measuring marketing ROI may seem like a hard nut to crack, a dive will be taken into ways by which marketing ROI can be measured.

What Gets Measured, Gets Done Well

How to measure digital marketing ROI

To measure digital marketing ROI, the right metrics and tools must be identified based on campaign objectives. Do you want to increase awareness, generate leads or just drive sales? Choose the relevant metrics that can help you achieve your campaign goals and boldly defend your marketing spend.


Today's customers are digital savvy and your website is one of the first touch points for your customers. Understanding how your visitors or potential customers are interacting with your website gives you insights on your marketing efforts. You can also generate and track the number of leads from newsletter signups on your website or enquiries. You can keep track of important metrics like;

Traffic: You can easily track the number of visits to your website from your campaign.

Bounce rate (percentage of the number of users who came to your website and left without taking any action on your site). If your bounce rate is high, you may have to dig deep to find out why (which could be as a result of the content not resonating with the audience) and find a way to reduce it; else you run the risk of spending time and money on marketing campaigns that are bringing the wrong traffic to your website.

Unique & Returning visitors. This is the number of individuals who came to your page and how many kept coming back.

Conversion rate: This is important because measuring your conversion rate helps you determine the overall success of your marketing efforts.

Your website also has metrics that your social and emails may not: direct sales attribution. With transactions and revenue records on your site, you can see how much money your campaigns and website are generating.

You can use Google analytics which covers these metrics that helps you track and evaluate your marketing efforts.

Social Media

Facebook, Twitter and Instagram have improved over time to give in-depth insights and analytics about your campaign. You can measure the engagement, clicks or click-through rate; you need to determine if your audience is engaging with your content or if they are clicking on your call to action. It is also important to add tracking parameters to your URL if you are looking to generate leads. In the end, you will need to evaluate and ask yourself, how much revenue or leads did my campaign generate at cost?

You can leverage Facebook insights and Twitter analytics to get a report on how your campaign performed, how much was spent and if your objectives were met based on your budget.

Traffic: This results in brand loyalty, customer growth, lead generation and conversions.

Follower growth: This measures the increase in the number of people (audience) who like or follow your brand page. This results in brand loyalty amongst the audience, increased brand awareness and customer growth.

Engagement: This measures how the audience interacts with your brand. This can result to brand loyalty, Increase brand awareness and community growth.

Reach or impressions: This measures the frequency your ad is served to the audience or how many times they see it. This can result in increased brand awareness, community growth.

Conversions: How many converted? How many leads have you generated? Measuring this gives you insights on lead generation, customer growth and revenue.


You need to ask yourself, How much did each email, open, click and what's the conversion cost? How much revenue did this campaign generate and at what cost? Some metrics to look out for are Bounce rate, Open rate, Unsubscribed rate, click through rate (CTR), conversation rate and leads.

In summary, in today's competitive digital marketing environment, measuring digital marketing ROI is no longer optional. The growing costs of reaching your target audience means it is necessary to increase your budget, spend it in the most efficient way, and demonstrate its impact on your business. Therefore, it is important to get to learning how to do this in the most effective way.