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Maximizing the Marketing ROI Maximizing the Marketing ROI Maximizing the Marketing ROI Paradigm Marketing and Design
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Marketing Tips, Insights, and Trends

Maximizing the Marketing ROI

Author: Rachel Durkan Category: Marketing, Strategic Business Growth Date: April 6, 2018

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Typically, when we spend money, we expect to receive something in return. Chances are, you wouldn’t wander into a grocery store, hand the cashier a $20 bill, and happily walk out empty-handed. If you’re going to spend $20 at the grocery store, you expect to go home with $20 worth of groceries.

The same concept holds true for your marketing dollars. For any business, big or small, the money you spend on marketing should materialize into something of value – namely, the conversion of new customers or the increase of brand equity. This is your return on investment. Your dollars, and the strategy put forth behind those dollars, are your investment. The increase in business revenue and profitability brought in as a result of your new customers is your return.

The major differences between marketing ROI and the grocery store example, however, are two-fold. First, whereas at the grocery store you would expect to walk out with a cartful of groceries that’s about equal in value to the money you spent, in marketing the goal is to seek a return that’s worth exponentially more than your investment. And second, marketing ROI generally requires multiple phases before a return is seen.

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In small business, it’s inefficient to try to obtain a direct ROI from one campaign – especially without a nationally recognized brand or the budget to achieve one. Instead, we have to look at short- and mid-term marketing, operations and finance goals as vehicles for achieving long-term objectives (namely, growing your business).

To most accurately measure your ROI, you must first identify and analyze your key performance indicators (KPIs) and then back into your approach, starting from the top of the pyramid and working your way down. Once your plan is in place, you start executing it from the bottom and work your way back up.

In the example illustrated below, our long-term goal is to increase our business revenue by $100,000, or the conversion of approximately 20 new clients. Over time and through careful execution and measurement, we’ve realized that for every five consultations we schedule, we typically convert two new clients. So to get 20 new clients, we’ll need to land 50 new consults; and to get those consults, we first need to create a strategic marketing and sales funnel that may look like this:


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In this example, we’ve opted to use a webinar as our hook for generating consultations. To increase the impact of our campaign, and to land the optimal number of webinar registrants, we know our best bet is to increase our Facebook following. So we allocate $2,000 toward a Facebook ad campaign that’s aimed at netting 3,000 new followers and, ultimately, 50 webinar registrants. Following the webinar, the participants receive a series of three emails that are part of a drip campaign, and 50 percent of them open those emails. Now we have 25 potential clients left in the funnel.

From there, our sales team follows up with the remaining 25 hopeful clients, and they’re successful in producing five consultations, which ultimately nets two new clients and produces $10,000 in revenue. After repeating the same campaign 10 times, we spend $20,000 and reach our desired $100,000 in revenue – a five-fold return on investment.

Although there are infinite types of campaigns you could run, the most important point to understand here is that 300,000 Facebook likes didn’t simply net $100,000 in revenue. It was the combination of our short- and mid-term marketing strategies – coupled with our commitment to sticking with them – that ultimately led to the accomplishment of our long-term objective.

For help maximizing your own marketing ROI, contact Paradigm Marketing & Design today for a consultation.

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330 Changebridge Rd. Suite #101 Pine Brook, NJ 07058, USA
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