Internet Marketing ROI

Christopher S. Penn, Director of Strategywww.WhatCounts.com

Fair Warning

XThree Disclaimers

How can a company be innovative and focus on ROI? How do you make a business case for something that's experimental? Let's say I wanted to my training team to spend two hours a week answering questions on Quora to see what happens, is it ok to do this without any ROI objectives?

- Scott Hemmons

I get a lot of analytics from various tools, including web site metrics, Bitly, Klout, Twitter, Facebook, LinkedIn, YouTube etc. It takes me a about an hour+ to pull it together each month. Do you have a one-stop shop solution that would make it easier? Even if I had 1 thing plus our web analytics that would make reporting so much easier.

- Becky Livingston

What?When?How?

Returnon

Investment

Earned - SpentSpent

= ROI

Return on “influence”Return on conversationReturn on engagement

1,000 - 500500

= 100%

250 - 500500

= -50%

Earned - SpentSpent

= ROI

Annual Income2,080

=Hourly

Annual Income2,080

=Hourly

Hours x Rate = Time

Spend in Money

$50,0002,080

= $24.04

5 x $24.04 = $120.20

1000 - 620.20620.20

= 61.2%

Money Earned:Money Spent:

Hourly Rate:Time Spent:

Time Spent in Money:

Total Spent:

Total Earned-Total SpentTotal Spent

$_______$_______

$_______ _______$_______

$_______

_______%

Worksheet 1

What?When?How?

ROI is not everything

Audience

Prospects

Leads

Customers

Evangelists

ROI really important!

ROI not as important!

What?When?How?

Earned - SpentSpent

= ROI

Worksheet 2

Method PPC Email Twitter

Money Earned

Money Spent

Hourly Rate

Time Spent

Time as Money

Total Spent

Earned - Spent / Spent

Worksheet 2 Example

Method PPC Email Twitter

Money Earned $1,000.00 $12,563.00 $750.00

Money Spent $500.00 $5,000.00 $0.00

Hourly Rate $24.04 $24.04 $24.04

Time Spent 5 5 40

Time as Money $120.20 $120.20 $961.60

Total Spent $620.20 $5,120.20 $961.60

Earned - Spent / Spent 61.24% 145.36% -22.00%

Worksheet 2 Example

Method PPC Email Twitter

Money Earned $1,000.00 $12,563.00 $750.00

Money Spent $500.00 $5,000.00 $0.00

Hourly Rate $24.04 $24.04 $24.04

Time Spent 5 5 40

Time as Money $120.20 $120.20 $961.60

Total Spent $620.20 $5,120.20 $961.60

ROI 61.24% 145.36% -22.00%

ROI is not necessarily a

helpful number

Keep or kill decisions

Last Touch Problem

Webinar

Tweet

PPC Ad

Blog Post

Sponsored

Email

Which caused the sale?

Old school single channel ROI is broken

Back to the

drawing board

Net Profit

Margin

Volume

Income

Expense

Audience

Action

Net Profit

Margin

Volume

Income

Expense

Audience

Action

Product

Operations

Marketing

Sales

Marketing’s primary output is qualified leads, yes?

EPL

Earned - SpentNumber of Leads

Money Earned:Money Spent:

Hourly Rate:Time Spent:

Time Spent in Money:

Total Spent:

Total Earned-Total SpentLeads

$_______$_______

$_______ _______$_______

$_______

_______ EPL

Worksheet 3

So what?

Yes, but so what?

Last Touch Problem Solved

Google

MCFOne Phrase:

Multichannel Revenue

Channel Last Touch MCF

Twitter $59,084 $125,315

Facebook $14,036 $22,388

Channel Last Touch MCF

Twitter $59,084 $125,315

Facebook $14,036 $22,388

Earned - SpentSpent

= ROI

59,084 - 50,00050,000 = 18.2%

125,315 - 50,00050,000 = 150.6%

The Big Picture ofInternet Marketing ROI

Walkthrough/Case Study

Worksheet 1

Method Web Facebook TwitterMoney Earned

Money Spent $180.00Hourly Rate $19.23Time Spent 780

Time as Money $15,000Total Spent $15,180

Earned - Spent / Spent

Worksheet 1

Method Web Facebook TwitterMoney Earned

Money Spent $180.00 $0.00Hourly Rate $19.23 $19.23Time Spent 780 260

Time as Money $15,000 $5,000Total Spent $15,180 $5,000

Earned - Spent / Spent

Worksheet 1

Method Web Facebook TwitterMoney Earned

Money Spent $180.00 $0.00 $0.00Hourly Rate $19.23 $19.23 $19.23Time Spent 780 260 260

Time as Money $15,000 $5,000 $5,000Total Spent $15,180 $5,000 $5,000

Earned - Spent / Spent

Worksheet 1

Method Web Facebook TwitterMoney Earned

Money Spent $180.00 $0.00 $0.00Hourly Rate $19.23 $19.23 $19.23Time Spent 780 260 260

Time as Money $15,000 $5,000 $5,000Total Spent $15,180 $5,000 $5,000

Earned - Spent / Spent

Channel Last Touch MCF

Twitter $4,800 $7,200

Facebook $42,000 $51,000

Last Touch VersionMethod Web Facebook Twitter

Money Earned $133,200 $42,000 $4,800Money Spent $180.00 $0.00 $0.00Hourly Rate $19.23 $19.23 $19.23Time Spent 780 260 260

Time as Money $15,000 $5,000 $5,000Total Spent $15,180 $5,000 $5,000

Earned - Spent / Spent 777.47% 740.00% -4.00%

MCF VersionMethod Web Facebook Twitter

Money Earned $133,200 $51,000 $7,200Money Spent $180.00 $0.00 $0.00Hourly Rate $19.23 $19.23 $19.23Time Spent 780 260 260

Time as Money $15,000 $5,000 $5,000Total Spent $15,180 $5,000 $5,000

Earned - Spent / Spent 777.47% 920.00% 44.00%

Channel Last Touch MCF

Twitter -4% 44%

Facebook 740% 920%

If you remove Twitter,this sale goes away.

Now You Have The Big Picture ofInternet Marketing ROI

ReviewWhat?When?How?

Webinar Tomorrow!

www.WhatCounts.com/smplus

cspenn.com/book

Christopher Penncspenn@gmail.comTwitter: @cspennLinkedIn: cspenn.com/lFacebook: cspenn.com/fGoogle+: cspenn.com/gWeb: christopherspenn.com

Questions?