Intelligent Content Conference
March 30, 2017
ROI is the benefit to an investor resulting from an investment of some resource. This session will provide you with a guide to having a conversation on the value of content marketing in relation to capital investment.
Key takeaways:
Discover Data Scientists: your new best friends
Found: The missing link between engagement and revenue
Content Marketing Platforms: their role in finding your very own unicorn
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Leveraging data scientists and why content ROI
1. @katrina_neal • #intelcontent
Leveraging Internal and External Data
Scientists
and why its key to content ROI
Katrina Neal
Content Marketing Evangelist, LinkedIn
@katrina_neal
@katrina_neal • #intelcontent
2. @TwitterHandle • #intelcontent
AGENDA
@katrina_neal • #intelcontent
How to talk ROI for [content] marketing
How to measure the value of your content marketing
How to leverage internal and external data scientists
The role of Content Marketing Platforms
8. @katrina_neal • #intelcontent
Return on Investment (ROI) is the
benefit to an investor resulting from
an investment of some resource.
In this formula, "Gain from
Investment” refers to the proceeds
obtained from the sale of the
investment of interest
Return on Investment
Gain from investment – Cost of investment
Cost of investment
=
ROI
10. @katrina_neal • #intelcontent
For Return on Marketing Investment
(ROMI) the two key metrics are
incremental net profit generated
from the activity (the financial
return), Versus the cost of campaign
(the investment). Measuring the
incremental net profit requires
deeper investigation.
Return on Marketing Investment
Incremental Net Profit
Cost of Campaign
=
ROMI
x 100%
11. @TwitterHandle • #intelcontent
AGENDA
@katrina_neal • #intelcontent
To calculate ROMI you need
• Cost of Campaign
• Incremental Sales
• Retailer Margin
• Variable Cost per unit
• http://romi.ipa.co.uk/index.php/calculator
13. @katrina_neal • #intelcontent
Calculate the revenue you generated
Incremental sales units [A] = 18 courses
Average price paid per unit [B] = £299
Value of incremental retail sales [C] = A x B
Value of incremental retail sales [C] = £5,382
Step 1
Return on Marketing Investment
Actual
A Incremental sales volume (units) 18
B Average price paid per unit £299
C = A x B Value of incremental retail sales £5,382
D Retailer gross margin (%) 0%
E = D x C Retailer cash margin (£) £0
F = C – E Incremental sales revenue to manufacturer £5,382
G Variable cost per unit £102
H = G x A Incremental variable costs £1,836
I = F – H Contribution margin from incremental sales £3,546
J = I ÷ F Contribution margin (%) 66%
K Cost of campaign £300
L = I – K Net profit generated by campaign £3,246
M = L ÷ K x100 Return on marketing investment (ROMI) 1082%
14. @katrina_neal • #intelcontent
Calculate the actual contribution you
generated. To do this you must take into
account the incremental COSTS incurred.
Variable cost per course (unit) was £102 = [G]
Incremental sales units [A] = 18 courses
Incremental variable costs [H] = [G] x [A]
Incremental variable costs = £1,836
Incremental revenue [F] £5,382
Incremental Costs [H] £ £1,836
Contribution Margin [I] = [F] – [H]
Contribution margin [I] = £3,546
Step 2
Return on Marketing Investment
Actual
A Incremental sales volume (units) 18
B Average price paid per unit £299
C = A x B Value of incremental retail sales £5,382
D Retailer gross margin (%) 0%
E = D x C Retailer cash margin (£) £0
F = C – E Incremental sales revenue to manufacturer £5,382
G Variable cost per unit £102
H = G x A Incremental variable costs £1,836
I = F – H Contribution margin from incremental sales £3,546
J = I ÷ F Contribution margin (%) 66%
K Cost of campaign £300
L = I – K Net profit generated by campaign £3,246
M = L ÷ K x100 Return on marketing investment (ROMI) 1082%
15. @katrina_neal • #intelcontent
Subtract the cost of the campaign to
calculate the actual profit it generated
Contribution margin [I] = £3,546
Cost of Campaign [K] = £300
Net Profit Generated [L] =
Contribution Margin [I] – Cost of Campaign [K]
Net Profit Generated [L] = £3,246
Step 3
Return on Marketing Investment
Actual
A Incremental sales volume (units) 18
B Average price paid per unit £299
C = A x B Value of incremental retail sales £5,382
D Retailer gross margin (%) 0%
E = D x C Retailer cash margin (£) £0
F = C – E Incremental sales revenue to manufacturer £5,382
G Variable cost per unit £102
H = G x A Incremental variable costs £1,836
I = F – H Contribution margin from incremental sales £3,546
J = I ÷ F Contribution margin (%) 66%
K Cost of campaign £300
L = I – K Net profit generated by campaign £3,246
M = L ÷ K x100 Return on marketing investment (ROMI) 1082%
16. @katrina_neal • #intelcontent
The ROMI is presented as a percentage to
show the ratio of profit from the investment
Return on Marketing Investment (ROMI) = L F
Net profit generated by campaign [L] £3,246
Cost of Campaign [K] £300
ROMI = 1082%
Step 4
Return on Marketing Investment
Actual
A Incremental sales volume (units) 18
B Average price paid per unit £299
C = A x B Value of incremental retail sales £5,382
D Retailer gross margin (%) 0%
E = D x C Retailer cash margin (£) £0
F = C – E Incremental sales revenue to manufacturer £5,382
G Variable cost per unit £102
H = G x A Incremental variable costs £1,836
I = F – H Contribution margin from incremental sales £3,546
J = I ÷ F Contribution margin (%) 66%
K Cost of campaign £300
L = I – K Net profit generated by campaign £3,246
M = L ÷ K x100 Return on marketing investment (ROMI) 1082%
17. @TwitterHandle • #intelcontent
AGENDA
@katrina_neal • #intelcontent
To Calculate ROMI you need
• Cost of Campaign
• Incremental Sales
• Retailer Margin
• Variable Cost per unit
• http://romi.ipa.co.uk/index.php/calculator
19. @TwitterHandle • #intelcontent@katrina_neal • #intelcontent
Pipeline marketing is what you’re
doing, while content marketing, inbound
marketing, lead nurturing, and growth
hacking are how you do it.
21. @TwitterHandle • #intelcontent@katrina_neal • #intelcontent
Attribution Models
Linear
Time
decay
U-shaped W-shaped
Full path
Custom/
Algorithmic
First
Touch
Last Touch
Lead
conversion
touch
22. @TwitterHandle • #intelcontent@katrina_neal • #intelcontent
B2B or B2C?
How many channels do you use?
Do you have a sales team?
How long is your sales cycle
Do you nurture opportunities?
29. @TwitterHandle • #intelcontent@katrina_neal • #intelcontent
Urchin Tracking Module (UTM) Parameters
utm_source
=Google
utm_medium
=CPC
utm_campaign
=spring_sale
utm_content
=logolink
utm_term
=scuba+diving
Optional
Simply tags you add to a URL - supported
out of the box by Google Analytics
30. @TwitterHandle • #intelcontent@katrina_neal • #intelcontent
Linear multi-touch attribution model
Each touchpoint is assigned the same amount of revenue credit
Calculate the percentage by dividing the whole value of 1 by the total number of touchpoints along your buying journey
31. @TwitterHandle • #intelcontent@katrina_neal • #intelcontent
Time decay
If the sales cycle isn’t short, the early moments may not considered to be very important
more concern is often given to nurturing initiatives
32. @TwitterHandle • #intelcontent@katrina_neal • #intelcontent
U-shaped
The U-shaped multi-touch attribution model focuses on two key touchpoints 40% each
but 20% of the revenue kudos is divided across the moments in the middle that occur between those two stages
33. @TwitterHandle • #intelcontent@katrina_neal • #intelcontent
W-shaped
W-shaped multi-touch attribution modelling is similar to U-shaped, but it includes an additional key touchpoint
34. @TwitterHandle • #intelcontent@katrina_neal • #intelcontent
Full path
The full-path marketing attribution model is one of the most sophisticated attribution models available.
A full-path model also includes the post-opportunity stage marketing initiatives and it incorporates sales activities into the mix as well
41. @katrina_neal • #intelcontent
Q:
What is the
probability that an
Engagement
Activity would
result in an SQL?
Q:
Which activities
would result in a
Return Visit?
Content as seen through a
Bayesian Network
Arcs: showing higher probabilistic relationships
Nodes: variables
45. @katrina_neal • #intelcontent
Guide vs. e-book?
We tested a Sponsored Update Headline with a Call To Action (CTA):
Download “Guide” vs Download “e-book”
“Guide” outperformed “e-book”
95% increase in Click Through Rate (CTR)
46. @katrina_neal • #intelcontent
Register vs. Join?
We tested a Sponsored Update Headline with a Call To Action (CTA):
“Register” vs “Join”
“Register” outperformed “Join”
165% increase in Click Through Rate (CTR)
47. @katrina_neal • #intelcontent
Quotes vs. Stats?
We tested a Sponsored Update Headline:
“Quote” vs “Stats”
“Quote” outperformed “Stat”
30% increase in Click Through Rate (CTR)
48. @katrina_neal • #intelcontent
Objects vs. People?
We tested a Sponsored Update Image:
“[Professional] Person” vs “Object”
“Person” outperformed “Object”
160% increase in Click Through Rate (CTR)
49. @katrina_neal • #intelcontent
Inmail vs. Inmail + Sponsored Content?
We did a multi channel test:
“Inmail” vs “Inmail + Sponsored Content”
“Inmail + Sponsored Content” outperformed “Inmail alone”
72% higher Click Through Rate (CTR)
55. @TwitterHandle • #intelcontent
AGENDA
@katrina_neal • #intelcontent
Step 1
• First, create a campaign that you want to promote.
Customize the creative, bidding, budget, etc. then
create an exact replica of that campaign as a second
campaign.
@katrina_neal • #intelcontent
56. @TwitterHandle • #intelcontent
AGENDA
@katrina_neal • #intelcontent
Step 2
• Once you have two campaigns that are exactly alike
in every way, change one variable - for example, the
targeting, the image or the headline text
• Run against the two different audiences for at least
two weeks
• After two weeks, use an A/B significance test to
monitor the results.
@katrina_neal • #intelcontent
58. @katrina_neal • #intelcontent
Variation A:
Control (the unaltered, original version)
Variation B:
Treatment (the optimized version which you
expect to perform better)
61. @TwitterHandle • #intelcontent
AGENDA
@katrina_neal • #intelcontent
Step 3
• Make sure to also keep track of your A/B tests over
time. Finally, glean the results from all of your tests
(or design a long-term experiment) to gain insights
about your target audience and the success of your
campaigns.
@katrina_neal • #intelcontent
62. @katrina_neal • #intelcontent
Variation A:
Control (the unaltered, original version)
+ 48%
Variation B:
Treatment (the optimized version which you
expect to perform better)
65. @katrina_neal • #intelcontent
Q: What is the
probability that an
Engagement Activity
would result in an
SQL?
Q: Which activities
would result in a
Return Visit?
66. @katrina_neal • #intelcontent
Q: What is the
probability that an
Engagement Activity
would result in an
SQL?
Q: Which activities
would result in a
Return Visit?
67. @TwitterHandle • #intelcontent@katrina_neal • #intelcontent
Understand commercial language
Champion the evolution of your content attribution models
Leverage data scientists and carry out your own experiments
Explore the potential of Content Marketing Platforms
TAKEAWAYS
68. @katrina_neal • #intelcontent
Leveraging Internal and External Data
Scientists
and why its key to content ROI
Katrina Neal
Content Marketing Evangelist, LinkedIn
@katrina_neal
@katrina_neal • #intelcontent