If you’ve ever felt like you’re navigating murky waters when calculating the Return on Investment (ROI) of your marketing campaigns, welcome to the club! ROI can be a real maze where you always seem to be back to square one, even after hours of trying to find the way out.
But fear not! Let’s explore the enigmatic world
ROI, understand why your ROI may be falling short, and how you can decipher the numbers to make more informed marketing choices.
You’ve put together the perfect campaign. You’ve researched your target audience, selected the most effective keywords, and spent hours asia mobile number list engaging ads. However, the ROI has been as disappointing as a bad movie. What now?
The Usual Culprit
One of the main culprits is a poor how to make a digital business card in canva? of what makes up ROI. The basic formula is:
ROI = (Profit – Cost of Investment) / Cost of Investment * 100
But here’s the problem. This formula is bare bones. It doesn’t take into account other crucial elements, like customer lifetime value (LTV), customer acquisition cost (CAC), or even indirect costs.
2: Solving the Labyrinth
LTV is like that well-kept secret that everyone wants but few truly understand. When you know the average lifetime value of a customer, you can uab directory understand ROI in the long term.
Customer Acquisition Cost (CAC)
If LTV is the treasure, CAC is the key that unlocks the treasure chest. Reducing CAC while maintaining or increasing LTV is every marketer’s dream.
Adjusted ROI
Now that you have the tools, it’s time to calculate the true ROI.
3: What to Expect When Expecting ROI
Just as a gourmet won’t settle for fast food, you shouldn’t settle for a mediocre ROI either. What is a good ROI? This can vary from industry to industry, but here are some guidelines:
- ROI below 0% : Immediate adjustment required.
- 0-20% ROI : You’re on the right track, but there’s room for improvement.
- 20-50% ROI : You’re doing great!
- ROI above 50% : You have found the Holy Grail of Marketing. Congratulations!