This is as tricky of a question as ever, and the answer is both yes, and no. With so many companies in the building industry relying on larger projects to drive their revenues, meaning fewer overall projects, it only makes sense that those clients are touched by a variety of the company’s marketing strategies before signing a contract, therefore, making it challenging to truly measure ROI on a particular marketing campaign. As an example, would you decide on which contractor to hire for your $100,000 home remodel, or your $100 million commercial development based solely on an ad which popped into your Instagram feed? Surely the answer is no! While this is a rather extreme example, the point is a valid one.
Before diving deeper into this topic, let’s first understand how ROI, or Return on Investment, is measured in the marketing arena. Typically, the formula used for calculating ROI is as follows:
((total earned – initial investment)/initial investment) X 100
Simply input the total amount you earned from a campaign and the amount you invested in it. Then work the formula, and the resulting number will be your ROI as a percentage.
For example, if you invest $100 in a campaign and make $600 from it, the result would be (600 – 100)/100 ´ 100 = 500%, meaning you earned five times what you invested.
Unfortunately, in construction marketing, it’s just not that simple. As mentioned previously, your clients likely have seen a multitude of your campaigns and have probably even independently done some research on your company prior to signing on the dotted line. Therefore, assigning ROI to a specific campaign may in fact be an exercise in futility. BUT, this doesn’t mean that efforts at measuring ROI should be abandoned. Quite the opposite actually, as taking some basic measurements and doing some tracking are critical when evaluating current marketing campaigns and planning next year’s strategy.
So, where do you start?
These are the five steps to measuring marketing ROI that you can begin implementing immediately.
- Set measurable marketing goals that include quantification, deadlines, purpose, and an action plan.
- Use multiple metrics and measurement tools to evaluate the program and individual tactics.
- Agree on what is being counted such as identifying what you are trying to measure, what data you are collecting, and what data will look like in the final report.
- Use existing measures before creating new ones such as company records, complaints, sales, and old surveys.
- Arguably most important, effectively communicate and present the ROI findings. Your team needs to understand how marketing efforts impact the bottom line.
While tracking marketing efforts to show ROI takes some time and money, the results will definitely be realized when you sit down to make next year’s marketing plan. You will have a strong understanding of what tactics were effective for your company. ROI gives power to decide if an increase or decrease in funds for certain tactics is necessary, and also adds credibility to your marketing efforts.
If your company needs help with its marketing campaigns and understanding/assessing ROI, contact BLDG Creative Company at info@bldgcreative.com or 619-796-2560 to schedule a consultation today!
