How to Calculate Content Marketing ROI - Insights
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Measurement

How to Calculate Content Marketing ROI

Despite a huge surge in adoption of content marketing, measuring the business impact of content is complicated. “How do I calculate content marketing ROI?” is the most common question we hear from marketers struggling to build their own business case internally. Many are plagued by their inability to measure the effectiveness of their content initiatives, usually because they’re measuring too narrowly and vanity metrics such as like and views aren’t enough. Marketers need to be able to measure things that have a quantifiable value that they can take to the bank. In this guide, we’ll map out how to calculate the impact of content across the business and the recommended metrics to benchmark your content initiatives.

Whitepaper by NewsCredAugust 3, 2016

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In this collection 1 Whitepaper / 35 Minutes

Part 1: Build the Business Case

All marketing spend should be tied to quantifiable results the sales team and executives can understand. Knowing the costs and ROI of other marketing departments will also help benchmark your content marketing ROI program and see how to stack up in comparison.

If you’re not sure what metrics to ask for, here are some to get you started:

 

Content Marketing ROI Metrics.png
Content Marketing ROI Metrics

 

Part 2: Find the Budget

Sometimes it can be difficult for companies to carve out sufficient budget to fund new content marketing programs. But we can find this budget if we look in the right places. First, we need to have a solid understanding of your organization’s current content costs and utilization. Every organization creates content, so start with calculating those content costs. Here are the steps:

  1. Conduct an audit for a sample of the content your organization produces.
  2. Apply to average costs in order to gain a sense for the size of the problem.

Next, we need to understand how much of your content actually gets used.

 

60 - 70% of content is wasted
60 – 70% of content is wasted

 

Remember that content that gets created but never used is 100% wasted. Here’s the way to calculate this:

Current content production costs – Amount that gets used = How much your organization is wasting on unused content. 

A planned content marketing strategy would provide a platform to share, reuse, and repurpose that unused content in order to grow brand awareness, improve brand health, and drive conversions.

Next, we need to look at opportunity costs from under-performing digital assets. We know that customers are tuning out advertising:

 

Consumers are more likely to be struck by lightening then click on a banner ad
Consumers are more likely to be struck by lightening then click on a banner ad

 

Asking for a small percentage of a larger advertising budget for short-lived campaigns is a good place to start looking for budget donations.

Part 3: Measure the Business Case

There are a few different ways to go about this, and the main three things to measure are brand awareness, brand health, and conversions.

How to Measure: Brand Awareness

In other words, how many of your early-stage prospects are finding their way to your company website?

 

Brand awareness what to measure.png
How to calculate content marketing ROI by measuring brand awareness

 

How to Calculate the Value of Paid vs. Organic Search Traffic

Content marketing allows you to gain additional reach, engagement and conversion without having to pay for it. You can literally earn your audience’s attention vs. buying it.

Organic search traffic can be calculated easily via Google Analytics.

  1. Go to ‘Acquisition’
  2. Then go to ‘Campaigns’
  3. Finally go to ‘Organic Keywords’

Here’s what this flow looks like:

How to use keywords in your content marketing strategy
How to calculate content marketing ROI by calculating the value of organic keywords.

You will then see the keywords people have used to find your website and the number of visits and percentage of overall visits you have received from each keyword. In this example, the site has received 359,953 visits from organic search traffic, totaling 25% of overall traffic.

Using keywords in your content marketing strategy
How to calculate content marketing ROI by calculating the value of keywords.

 

Next we want to see how much paid traffic we’re receiving, which we can also find in Google Analytics’ ‘Paid Keywords.’ In this example, let’s say we spend $100,000 on paid search traffic for 1,078,779 visits.

 

Calculating organic search traffic
How to calculate content marketing ROI by calculating the value of organic search traffic.

 

Based on those numbers and percentages, we can calculate the value of that organic traffic. In this example, let’s say we spend $100,000 on paid search traffic.

How to Calculate the Value of Unbranded Organic Search Traffic

Any visitor that searches your brand name already knows where they want to go. Unbranded organic search traffic is important to calculate because we want to know about the people who didn’t know where they would end up. They had a question or need, asked a search engine for direction, and that interaction brought them to you.

To calculate unbranded organic search, we need to exclude your brand or products’ name from the search. To do this, create an “Advanced Filter” that will exclude those branded keywords. In this example, our brand and products contain the word “Raspberry.”

Calculating unbranded search traffic
How to calculate content marketing ROI by calculating the value of unbranded search traffic.

Let’s say the results showed that now with excluding branded keywords, your site’s organic search traffic accounts for 269,694 visits, or about 19% of total organic traffic. We go back to our table to calculate the value of this traffic.

 

Calculating value of unbranded search traffic.png
How to calculate content marketing ROI by calculating the value of unbranded search traffic.

 

How to Calculate the Value of Organic Search Share of Voice

This essentially measures how much your brand or product is talked about compared to your competitors.

 

Share of voice market share graph.png
How to calculate content marketing ROI by calculating the value of organic search

 

First you want to choose a group of words based around your brand’s product or service. When choosing your words, be sure to stay within a common theme. In this example, we’ll use a dance brand.

Keywords:

  • Dance shoes
  • Dancing shoes
  • Cheap dance shoes
  • Affordable dance shoes
  • Ballet shoes

Source: Moz, How to Calculate Share of Voice for Organic Search

In general, it’s better for your SEO strategy to focus on a specific topic. Think narrow and deep, instead of broad and shallow.

Next, choose your competition. Who do you want to compare yourself against?

Be sure to know what URLs you’re wanting to track of your competitors. Some may use off-branded URLs for their content marketing efforts. For example, ConAgra’s content marketing is done on an off-brand site, Forkful. The site provides time-saving kitchen tips and advice for cooking with kids.

 

Forkful recipes blog
Forkful recipes blog

 

Now record the rankings for each keyword you selected for yourself and your competitors. If you do rank, record in what position. (Note: You can rank more than once.)

 

Keywork rankings google analytics.png
How to calculate content marketing ROI by calculating your brands share of voice.

 

When doing this, keep in mind there is no point in looking at more than the top 10 because only 2% of users travel to the second page of Google.

 

Calculate share of voice.png
How to calculate content marketing ROI by calculating your brands share of voice.

 

If your rank more than once, simply add the click through rates to find that keyword’s total share of voice.

 

Calcuating share of voice for keywords chart.png
How to calculate content marketing ROI by calculating your brands share of voice.

 

To find your overall share of voice, average the share of voice for all of your keywords.

 

Calculating share of voice by keywords.png
How to calculate content marketing ROI by calculating your brands share of voice.

 

If there’s a gap between your market share and your share of voice, that means your competition is wooing your prospects before you!

 

 

How to Measure: Brand Health

If you’re like most brands, you probably promote yourself too much and people learn to tune you out.

David Beebe Content Marketing Quote
Quote by David Beebe on treating content marketing like a first date.

Brand health measures how your digital audience feels about you.

Let people get to…

  1. Know your brand
  2. Like your brand
  3. Trust your brand enough to buy from you

 

How to measure engagement.png
How to calculate content marketing ROI by measuring engagement.

 

Measuring audience growth.png
How to calculate content marketing ROI by measuring audience growth.

 

 

How to Calculate the Value of Time on Site

When determining your time on site goals, it’s important to keep in mind why someone is going to your site. The biggest takeaway is that not all time on site is equal. 

 

Measuring engagement and time on site.png
How to calculate content marketing ROI by knowing the value of time spent on a website.

 

How to Calculate the Value of Repeat Visitors

96% of people visiting your site aren’t actually ready to purchase from you (Source: Social Media Today, 2014).

So you need to think of other ways to bring prospects back to your site so that when they are ready to purchase, they choose you. If your ultimate goal is to sell a product or service, you’re much more likely to sell to visitors who come back time after time.

Repeat Visitor Ratio (RVR) measures the percentage of visitors who return to your site after an initial visit during some specific time period.

Let’s say you got 4,000 visitors this month and 800 were repeat visitors. 800/4,000 = 20%.

RVR is great way to determine whether you are successfully engaging your site visitors. New visitors are fine, but repeat visitors are great since once you “have” a new reader you don’t have to spend time and money attracting that reader–your content is sufficient. So the higher your RVR the better your website must be at engaging the average new visitor. 

To put a monetary value on RVR, we need to look at the average amount you’re spending in advertising to drive net new traffic. For our example, let’s say you’re spending $5,000 per month on advertising to drive new visitors.

If 80%, or 3,200 visitors are net new, you’re spending an average of $1.56 per visitor.

$5,000 / 3,200 = $1.56

Taking that finding, we can then calculate the value of our 800 repeat visitors. 800 * $1.56 = $1,250

Therefore, our repeat visitors are valued at $1,250 per month. 

 

How do you improve your RVR?

1. Better targeting in your marketing

2. Provide great content

3. Ensure site navigation is streamlined and intuitive

4. Constantly create new content to keep the site fresh and relevant

Don’t forget that while you want to increase the percentage of repeat visitors, you also want to increase the total number of visitors… Otherwise you’ll be preaching to the same choir.

 

How to Calculate the Value of Subscriptions

Your email list is an asset, and should be valued as such. But first thing’s first: You must know your maximum allowable cost threshold for getting a new subscriber, otherwise, you’re spending in the dark – or, worse yet, to the point of negative returns.

Knowing your cost to obtain a new list member is the only way to determine how much you can actually afford to invest in growing your list sign-up… And what your maximum allowable cost to obtain a new subscriber should be.

As a general rule, your list sign-up cost per acquisition (CPA) should be well under your average sale amount from a new customer and within range of what you pay to obtain other valuable actions, such as webinar sign-ups, free content downloads or even direct sales.

First, calculate what it actually costs you to get a new subscriber from each list-building method.

 

Calculating cost per acquisition
How to calculate content marketing ROI by calculating the value of subscriptions.

 

Now we need to determine your maximum allowable CPA for acquiring a new list member, and continue to invest in the methods that fall at or below your CPA.

Let’s say you’ve tested a few tactics and decided that your maximum allowable CPA for a new email address is $1.50. Moving forward, you’ll want to continue pursuing all methods costing $1.50 or less.

 

Calculating CPA.png
How to calculate content marketing ROI by calculating cost per acquisition for Twitter and Webinars.

 

Over time, we need to also measure the quality of the subscribers on your list by monitoring things like average sale value and unsubscribe rate.

 

Calculating CPA.png
How to calculate content marketing ROI by calculating cost per acquisition and number of subscribers.

 

When you analyze the data, you’ll easily be able to spot the methods that produce the best quality and quantity of subscribers within your allowable CPA. The higher the quality of subscribers you attract, the more likely they are to convert to becoming not only customers but also your best customers-resulting in more revenue from which to raise your CPA.

To calculate the value per subscriber, we need find the difference between the sale value and cost per acquisition for the subscribers. To do this, we use the formula below:

VALUE PER SUBSCRIBER = ( QOS * ASV * ( 1 – UR ) – QOS * CPA ) / QOS

We’ll use Facebook Ads as an example:

VALUE PER SUBSCRIBER = ( QOS * ASV * ( 1 – UR ) – QOS * CPA ) / QOS

VALUE PER SUBSCRIBER = ( 200 * 100 * ( 1 – 0.30 ) – 200 * 2.30 ) / 200

Therefore, the value of each Facebook subscription is $67.70 

 

Calculated CPA.png
How to calculate content marketing ROI by calculating CPA.

 

Based on these calculations, we can see that paid search and webinar methods return the most value per subscriber.

Calculating CPA for paid search and webinars.png
How to calculate content marketing ROI by calculating cost per acquisition by each content marketing method.

However, since paid search’s CPA is more expensive than our maximum allowance of $1.50, we should defer to webinar and Twitter tactics.

Calculated CPA for Twitter and Webinars.png
How to calculate content marketing ROI by calculating cost per acquisition by each content marketing method.

How to Calculate the Value of Bounce Rate

Your site’s bounce rate is a metric that indicates the percentage of people who land on one of your web pages and then leave without clicking anywhere else on your site.

A high bounce rate is a reason for concern since it indicates that your website visitors aren’t looking for more content on your site, clicking on calls-to-action, or converting into contacts.

Since attracting and converting visitors into qualified leads is the main objective for content marketing, this is an important metric to measure and improve.

 

Good bounce rate benchmarks graph.png
How to calculate content marketing ROI by benchmarking good bounce rates.

 

Why do visitors bounce? Two reasons:

1. They didn’t find what they were looking for

2. The page wasn’t user friendly

 

So what can you do to improve your site’s bounce rate?

  • Attract the right visitors
    • Choose the right keywords to match your content — not just to attract the most number of visitors
    • Maintain top rankings for branded terms
    • Write attractive, useful meta descriptions for search engine users
  • Enhance usability
    • Make your text readable through sensible organization and the use of larger fonts, bulleted lists, white space, good color contrast, and large headlines
    • Use well-organized, responsive layouts that allow for quick and easy navigation on all platforms and browsers
  • Use a good layout
    • Quick navigation
    • Easy to find search
    • Content in sections
    • Responsive layout for multiple platforms and browsers
  • Speed up page load
    • Use little or no self-loading multimedia content
    • Set external links to open in new browser windows/tabs
    • Don’t let ads distract from your content: place static ads to sides, and avoid pop-ups and self-loading multimedia ads
  • Provide good content
    • Have an obvious main message
    • Use clear headers and subheads
    • Tailor content to intended visitors
    • Use stylish copy and images
    • Make your content error-free
    • Include a clear call-to-action and obvious links to next steps

How to Calculate the Value of Social Shares + Followers

While social shares can be seen as an engagement metric, but should be quantified as a free source of distribution and reach.

Let’s say you spend $1,000 on paid social distribution and reached 5,000 viewers.

For this campaign, each view was worth $0.20 ($1,000/5000).

Now let’s say a social post was shared organically by your followers and reached 500 viewers.

Based on the value of each view from our paid distribution, we can also value our 500 organic views at $0.20 each, or $100 total.

Brands should also track if their social follower growth positively correlates with their total number of shares. If it does, this would indicate that your organic social shares are reaching the right audience for your brand.

 

How to Calculate the Value of Share of Voice/Offsite SEO

Google has stated that it uses more than 200 factors to rank a web page, but which are the most important?

There is one thing virtually all SEO experts agree upon: The number and quality of links coming into your site is near the top of the list.

 

So how can you measure your off-site SEO?

  • Measure your inbound links and their value. An easy way to do this is by plugging your site URL into Open Site Explorer. (https://moz.com/researchtools/ose/)
  • With this tool, you can see all inbound links, see your top-linked pages, sort by linking domains, see the anchor text other sites use to link to you.
  • Do the same with your competitors’ sites and compare

What to do with this data?

  • Scan your highest-authority inbound links for opportunity to get other similar links
  • Scan your competitors’ highest-authority inbound links. Can you get those links too, or do they provide ideas for getting similar links?
  • Inbound links from non-profit (.org) and education (.edu) sites are especially powerful
  • Build your inbound links gradually. Google algorithms will notice, and may penalize a quick accumulation of links.

 

How to Measure: Conversions

These are prospects who became customers because of either helpful, useful and/or entertaining content you provided them.

 

How to measure conversions.png
How to calculate content marketing ROI by measuring conversions.

 

Calculating content marketing’s cost per lead is crucial in order to benchmark your program’s effectiveness against other marketing programs.

Determining this is quite simple. To begin, we need to know the costs accrued to create and distribute the content.

In this example, we’ve created two pieces of content:

For the ROI Guide, we spent $3,000 to create and invested $10,000 to distribute

For the Strategy Guide we also spent $3,000 to create, but spent $20,000 to distribute

Combining these costs, we can see that the ROI Guide cost us $13,000 and the Strategy Guide cost us $23,000.

 

Calculating Content Marketing Cost Per Lead.png
Chart calculating content marketing ROI showing the cost per lead.

 

 

Now that we know how much our content cost to create and distribute, let’s see how the content did in terms of lead generation to calculate cost per qualified lead.

Our ROI Guide generated 550 new leads, 205 of which were qualified leads.

To calculate cost per lead, we want to take the total cost ($13,000) divided by the total number of qualified leads (205).

$13,000 / 205 = $63

 

Therefore our ROI Guide cost $63 per qualified lead. 

To determine an accurate average total cost per lead of content marketing, we’d want to take a larger sample, but for the purpose of this guide, we’ll simplify and average these two costs.

$63 + $177 / 2 = $120

Therefore our average total cost per lead for content marketing is $120.

 

Calculating Content Marketing Cost Per Lead.png
Chart calculating content marketing ROI by the total cost per lead.

 

How to Calculate the Value of Percentage of Leads Sourced 

In order to determine the percentage of leads from content marketing, we first need to gather total number of leads sourced from other marketing programs.

Looking at this gathered data, we see that content marketing accounts for 205 of the total 710 marketing qualified leads. To find the percentage, we take 205/710 to find that content marketing accounts for 28.9% of total qualified leads.

 

Chart of Percentage of Leads Sourced.png
Chart calculating content marketing ROI by showing the percentage of lead sources.

 

How to Calculate the Value of Conversions

Finally, to determine the actual revenue sourced by content marketing, we need to look at conversions.

For this example, let’s say our content marketing has a conversion rate of 50% and the average sale is worth $500.

To find our total conversions, we need to multiply our total qualified leads by 50%

205 * 50% = 102.5 conversions

Based on that finding we assume these sales will average $500, so to find the total value we • multiply 102.5 * $500 = $51,000

Therefore, our total content marketing conversions are worth $51,000

 

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