As a small business owner, breaking even and earning a profit are likely the two most important goals of your business plan. But the path from putting your company on the market and gaining traction to paying all of your expenses and coming out in the black is a hard battle, especially at the start. One of the ways you can get a head start is by maximizing your marketing ROI and building on the engagement that brings.
Marketing is one of the primary ways of getting your prospective customers’ eyes on your product or service. But it’s also overlooked by many small business owners due to the idea that it’s not worthwhile or too expensive. However, knowing how to make the most out of your marketing budget will help you see a better return on your investment, or ROI.
Your ROI is determined by measuring the goals of your campaigns and the money they’ve contributed to the company against the investment or money your company spent on the campaign. Although the particular calculation varies depending on your goal and the type of marketing campaign you’ve deployed, whether it be through social media, email, or other avenues, you’ll want to consistently check on the profit your campaigns are making and make improvements.
Ways To Improve ROI
But how do you make those improvements? By analyzing the data on how your campaigns are doing and optimizing as needed. There are several tools and methods you can use to determine if a campaign is performing to your benefit.
One of the best tools at your disposal if you’re running paid ads is to use Google Ad Manager. It works in tandem with Google Ads to show your advertising campaigns on the Google Display Network as well as search pages and Youtube and provides a hub for your team to manage these ads and optimize them. A big advantage is that you can have multiple manager accounts, and with its conversion tracking feature you’ll be able to easily track your ROI as you’ll be able to compare the data and determine how much revenue you’ll likely gain from your campaigns.
A simple yet incredibly effective marketing channel that you may be underutilizing as a smaller business is email. It’s known as the most effective marketing channel, able to deliver the most ROI out of all channels. A tactic you should be employing is building your email list, as that allows you to build a solid base of both prospective customers interested in learning more about your product or service and those who are already customers and can be turned into repeat buyers.
But it’s not as simple as sending out emails with text-only, unless that’s proven to work with your list, about sales and company news. You’ll need to dedicate time to figure out what information your customers and would-be customers want to see, and segment your list accordingly.
Determine if You Need To Optimize
Email marketing works best when the right messages are being sent to the right people at the right time. But to do so you’ll have to follow a few steps to optimize your ROI for this channel:
1. Determine if the campaign is meeting the core metrics, which for email include clickthrough rate and conversion rate. If people are clicking on the links and performing the action you want, that’s a good sign.
2. Consider whether the channel you’re using, i.e. ads, video, etc, is the proper channel for the campaign. For email especially, you may poll your list to find out if there’s a channel that they’re more active on or prefer to read updates from your company on. If your target market isn’t on the channel you’re using, you’re less likely to get the traction and sales you’re after. If your competitors are utilizing the channel effectively, perform market research to find out how you can improve your campaigns and reach your prospective buyers.
3. A main point of marketing is testing, so a third step is to conduct A/B testing. While your campaign may be performing well as is, using A/B or split testing to find out if your customers react more positively to a different call-to-action, landing page copy, or subject lines can easily boost your ROI. This is especially useful in email marketing as you have to entice your recipient into clicking on a link, and then continue to bring value and/or information so that they’ll convert.
Optimize for the Future
Optimizing for ROI not only sets you on a better course to increasing profit and scaling your business, but allows you to focus on the correct market and offer them the correct content which improves their trust in your brand. Using Google Ad Manager and email marketing to your advantage can set you apart from your competitors and make it easier to implement changes and adapt as the market shifts which overall makes for a more stable business model.