The beauty of Internet marketing is how measurable the ROI is.  That being said, it’s surprising how many Internet marketing campaigns are run without clearly defined goals and a means of measuring performance to reach those objectives in place.  Simply driving traffic to a site’s homepage and utilizing the increase in Web site visits is not an effective measure of an Internet marketing campaign.  One must define conversion goals (e.g., form submission, newsletter sign-up, or product purchase) and measure the success of the campaign based on the volume of visitors that complete the pre-defined actions. Otherwise, you may be driving tons of traffic to your site through compelling ads that, in hindsight, are attracting nonqualified users. One cannot differentiate the performance of and optimize one text ad, keyword or banner versus another without the proper tracking.  There is no excuse not to have effective tracking in place as the most widely used Web analytics package, Google Analytics, is available free-of-charge.  If you cannot tell me your exact ROI for most every aspect of your Internet marketing campaign down to the most granular levels, I am confident that the campaign’s overall ROI can be improved.

That being said, many marketers are seeing a dip in their Internet marketing ROI across online verticals. The reason for the decline may be due to increasing media costs, a more competitive landscape, and/or changing Internet behaviors.  Each company that is experiencing a falling ROI also probably has contributing variables that are unique to their industry and demographic.  Regardless of why a company’s ROI is decreasing, it most likely can be improved.  A well-run Internet marketing campaign requires:

1.) An easy-to-use Web site that leads to conversions
2.) A well-researched and strategic online marketing plan
3.) Excellent reporting
4.) Ongoing adjustments
5.) Knowing when to outsource

If your campaign is missing any or all of the above attributes, you’re fighting an uphill battle.  This article explains why each of the above is so important to Internet marketing success and points you in the right direction to improving your results if an issue is identified.

No matter how much traffic is driven to a Web site, if users do not know what to do once they have arrived, there is no chance of turning them into customers.  It is our job as marketers to provide potential customers with the information they are looking for and to create clear paths to conversion.  This process includes writing copy that will be read, highlighting the desired calls to action, making “contact us” information ubiquitous on the site, and monitoring/optimizing user navigation paths.   Professional images must support the text and make users comfortable with your brand.

Regardless of how good we think our site is, we can probably improve it by effectively using Web analytics software to determine how users are navigating to conversion and juxtaposing that information against where nonconverting users are exiting the site.  A thorough analysis should provide actionable data that can be used to add, delete, or change links to better funnel customers towards conversion, hence improving ROI.

There is no doubt in my mind that declining ROI within Internet marketing can partially be contributed to the fact that many firms are casting too wide of a net into unresearched territory.  Much of this phenomenon can probably be based on the advent of Web 2.0 (Social Media) and the fact that more “traditional” forms of Internet marketing (e.g., SEO and Paid Search) have now been legitimized within the marketing trade journals.  Unfortunately for many companies, “Internet marketing” is an undefined line item within a marketing plan.  It should instead be a complete subsection, in essence its own marketing plan, that includes SWOT analyses of SEO, paid search, social media, banner advertising, affiliate, and e-mail marketing.  If your company has “thrown” money at Facebook advertisements, Google media, or banners, it is highly probable that your Internet marketing ROI can be improved with a better-researched strategy.

I imagine some readers who are experiencing declining online ROI feel they have an easy-to-use Web site, well-researched Internet marketing strategies, and excellent reporting and still do not feel they have an answer to the question of why their ROI has declined. My question to you would be; how much time are you devoting to analyzing and optimizing the performance of your Internet marketing campaign?  You may have the ultimate conversion funnel defined on your Web site, the Cadillac of analytic packages and perfect reporting, but, if you are not constantly monitoring the data and taking action based on the information gleaned, then you are underutilizing the metrics available to you and your ROI can be improved.

An effectively run Internet marketing campaign is not something that one can set up and then put on autopilot.  Ongoing management is required to maintain positive ROI trends in an increasingly competitive atmosphere whose users’ behaviors are constantly changing.  It is extremely important that the person who will be monitoring/optimizing the campaign’s performance has Internet marketing knowledge, excellent analytic ability, the power to implement changes, and, most preciously, time.  Unfortunately, some extremely busy marketing departments add Internet marketing into their “mix” with little or no knowledge of the channel (or various channels within), an inherent leaning to creative versus analytic ability, and little or no time to effectively manage, much less continuously learn about, the channel.

If you find yourself in this position, it is time to consider handing the reigns of your campaign to an Internet marketing professional who should be able to reverse your declining ROI.  Knowing when to outsource can be the most effective decision toward improving your overall Internet marketing ROI–even with the additional management fees.

The long and short of it is that there are many variables that affect Internet marketing ROI.  Some will affect performance more than others; however, if your campaign is running on all cylinders, it is doubtful that you’re experiencing the decreasing ROI trend that many are complaining about.  If you are able to identify where your campaign is falling short and reverse the issue(s), I am confident you will be on the path to improving your ROI.

This entry was posted on Tuesday, November 10th, 2009 at 5:04 pm and is filed under Internet Marketing Strategy, Rise Interactive. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.