Make It Loud Blog

Advice and Knowledge from EXPERTS

Ways Of Thinking About The ROI Of Digital Marketing

Today, more than at any other time in history, customers are being introduced to, talking to, and purchasing from businesses online. As the world wrestles with the pandemic fallout, this trend is only going to accelerate. That is why digital marketing is vital to your ongoing survival or success.

Digital marketing provides a wide variety of ways of reaching potential customers online. You could choose to invest in SEO (Search Engine Optimization) to boost the traffic you receive from online searches. Paid advertising through Google AdWords can also be an effective option, and Google my business can generate traffic for a local business.

Outside of these, you can advertise on Facebook with Facebook ads or build an audience with social media posting and paying to boost posts. Email marketing is a highly effective tool as well.

Regardless of which channel or combination of channels you use, the one thing in common is that you need to be able to measure how they’re working for you. No one wants to throw their money away.

What Is ROI?

ROI is an acronym for Return On Investment. It is a calculation of the return you get on the money you spend. You can often break it down; for example, you may calculate that you receive two dollars in return for every dollar you invest into digital marketing. If it’s not going so well, you may be only receiving 50 cents back for every dollar you spend, and it may be time to make some changes.

How Do You Calculate ROI?

Time for the nerdy part. The Return on Investment compares the profit from the campaign against the cost of running the digital marketing. The basic calculation looks like this:

ROI = (Net Profit / Cost of the Campaign) X 100.

For example, if you run a campaign that costs $100 and creates a profit of $1,000, your ROI would be:

ROI = (1000 / 100) x 100

ROI = 1000%

As you can imagine, getting a return of one thousand percent is a spectacular ROI.

The results from this calculation are only as good as the data that you put into it. Put simply, inaccurate figures will give you an erroneous result. To get an accurate ROI that is of use to you, there are some areas you need to consider.

Understand Your Objectives

Before you can know if your campaign has been a success, you need to know what you were trying to achieve. Not everything you do will have a direct monetary value that will show up in the ROI.

Things like lead generation and web traffic can be measured, but you won’t see them in the ROI. You may have to look beyond the dollars earned to see the actual value of your digital marketing.

Identify Key Performance Indicators (KPIs)

You need to understand the KPI’s that make your business tick. They will be unique to each business, as no two enterprises have the exact same circumstances. Copying KPIs from a competitor is a sure way to measure information that may or may not be helpful to you. KPIs you could consider are:

•      Unique Monthly VisitorsThis lets you know how many people visited your website in a month. You can further break this information down to show the source of the visits. How many came to you via organic search, or from paid social media posts, etc.

•      Cost Per Lead This is calculated automatically by Google AdWords and shows how much you spend to get each lead.

•      Cost Per AcquisitionHere, you’ll learn how much it costs you to get a paying customer. You get this figure by dividing your total ad spend by the number of new customers.

•      Return On Ad SpendThis is the ROI on an ad that you have created

•      Average Order ValueThis is a valuable metric that lets you know how much a customer spends once you acquire them.

•      Customer Lifetime ValueWhat is a customer worth to your business? Here is where you answer that question.

•      Lead To Close RatioYou get this figure by dividing the number of leads by the number of sales. This will help you measure the quality of the leads you’re generating and how effectively you convert leads.

•      Branded Search Lift This will tell you how many people are out there searching specifically for your business. As your brand awareness increases, so to will this number.

•      Average Position This will let you know where you’re ranking on search results for your targeted keywords. Google Analytics can be an excellent source for this data, which will significantly affect the volume of traffic visiting your site.

•      Non-Brand Click-Through-RateThis will tell you how well your SEO is working by letting you know how many people visited your site when they weren’t searching for your business by name.

•      Visibility ScoreThis is a measurement of how often your website shows up in the search results which increases the likelihood of getting more clicks.

Make Sure You Collect Accurate Data

For data to be valuable, it has to be clean. Any inconsistencies or errors in data collection will alter your results. With skewed information, you will not have an accurate picture of how you are performing against KPIs or your ROI.

Before collecting data, you should decide which are the critical indicators for you. Using appropriate data collection software and having standardized procedures across marketing and sales teams are essential. The system should be centralized and accessible.

Work Out How KPIs Fit Into The Bigger Picture

The sole reason you run a digital marketing campaign is to increase sales. So it’s only natural that you would focus on revenue and ROI. However, if your focus is too narrow, you will miss how all the cogs work together to turn the engine.

For example, if you have KPIs to increase traffic to your website and lower the acquisition cost for each customer, these could work together to boost your marketing ROI. A KPI of promoting organic search could increase site traffic and reduce the cost of each customer. One area can affect many others.

What Is A Good ROI Anyway?

Industry benchmarks are a good place to start evaluating your ROI. For example, Google AdWords has an average conversion of 2.4%. If you can get yours up to 11.1%, you’re in the top 10% of companies.

Beyond benchmarking, you can also compare your companies historical ROI performance with what you’re producing now. Look for peaks and troughs and performance and see if you can diagnose what has caused them.

A good ROI for digital marketing will be subject to the audience, business size, goals, and the industry. There may also be times you need to look beyond the ROI to assess performance.

Tools To Help Identify Your ROI

All of this may seem a bit overwhelming at the moment but never fear. As always, there’s an array of tools that can have the information you need at your fingertips.

Google Analytics

Google Analytics is a must-have tool for anyone who runs a website. It helps you keep track of what is happening with your website traffic. Things like:

•      Pageviews

•      Bounce rates

•      Visitors location

•      Source of traffic

•      Page value

•      Conversion goals tracking

•      Assisted conversion value

Google Analytics can track all this information on specific campaigns to see how much they’re contributing to the traffic on your site. If you have a particular goal, such as lead generation or conversion, this tool can also track them.


Cyfe is a tool that will provide you with data on your digital marketing across multiple channels. You will be able to collect data from:

•      Advertising

•      Blogging

•      Email

•      Sales & Finance

•      SEO

•      Social media

•      Web analytics

For example, you will be able to see how well you can reach and convert customers on a social media platform.


Running social media on many different channels can quickly become a time-consuming hassle. Hootsuite allows you to run all your accounts from a single platform.

It will also provide data on the results of your social media efforts. You can look at your social media as a whole, or for example, see what your ROI is on just Facebook.

Sprout Social

This is another tool to measure your social media performance. It will show you posts with the highest engagement as well as the lowest. You can also measure other metrics like impressions and clicks through to your site. Sprout Social will let you monitor all your social channels in a single place.


Apart from being a keyword tool, SEMrush is a goldmine of information on your organic traffic. It has an Organic Traffic Insights tool that will tell you how many visitors find you through search engines. You will be able to see:

•      Number of users

•      Number of sessions

•      Number of pages per session

•      Bounce rates

•      Goal completion


Email can be one of the most effective forms of digital marketing. Once you have collected the following data from your Email Service Provider:

•      Send volume

•      Open rates

•      Click-through rates

•      Conversion rates

•      Average value of a conversion

•      Campaign’s cost

You can then use this tool to provide you with information such as:

•      Revenue

•      Profits

•      Cost per open email

•      Cost per conversion

•      ROI

A Simple Way To Consider ROI (Without A Lot Of Math)

If you struggle with the math involved with ROI calculation, there is a simple way to measure the ROI of your digital marketing efforts.

Consider what your average customer is worth to your business. For some, this may be tough to nail down, so be conservative with your numbers just to be safe.

For example, we recently talked to a prospect who installs commercial fire alarms in buildings. He said an install can bring in anywhere from $5000 to $60,000. In this example, even taking the lowest number means that an SEO campaign that costs $1000/month would need to only bring in one client a month in order to be profitable. The same is true for an Adwords campaign with $1000/month.

Clearly, looking at the total cost of your ad spend vs what that campaign needs to bring in is a reasonable way to keep track of your return on investment (ROI).

The Final Point

For the past 17 years, the staff at Make It Loud has worked with all kinds of businesses, and one thing that consistently amazes us is how often we come across business owners that simply don’t keep track of any data around their marketing. We once worked with a roofer who had another digital agency run an Adwords campaign for him at $1200/month, and he forgot about it- for 6 years! He had no idea how poorly it was doing until we found it and pointed it out for him.

The point here is that it’s important to measure your digital marketing efforts. The simple fact is that what is observed (or measured) improves.

If you need help with any aspect of your marketing strategy, contact the staff at Make It Loud today. Let us bring our experience and expertise to help put more money in your pocket.




author avatar
Cliff Tillery COO
Cliff Tillery, MBA is the Chief Operating Officer and SEO Director at Make It Loud which is a digital marketing firm located outside of Atlanta Georgia. More than 15 years ago, he started search engine optimization at this award-winning agency and has taught digital marketing skills to interns and new employees, business owners at the Gwinnett Chamber of Commerce, the Gwinnett Entrepreneur Center, and other groups.
Google Certified Partner logo

  Address: 2828 Buford Dr #300, Buford, GA 30519

  Phone: (678) 325-4007

  Office Hours:

Monday - Friday OPEN 9:00 AM - 5:00 PM
Saturday and Sunday CLOSED

Address: 3409 N. Holland Sylvania Road, Suite 8, Toledo, Ohio 43615

Phone: 419.405.1609

  Office Hours:

Monday - Friday OPEN 9:00 AM - 5:00 PM
Saturday and Sunday CLOSED

[widgets_on_pages id="1"]