By Michael Brenner published May 2, 2016

The Secret to Content Marketing ROI

content-marketing-roi

Questions about content marketing ROI are probably the ones I hear most from marketers who are struggling to build their own business case internally.

We know our customers are turning out advertising. And we know that as consumers, we are all consuming more information online. We are looking to get informed and we are looking to be entertained.

We don’t care where the content comes from. But we aren’t sitting around waiting for it. And we won’t go too far to find it.

But building the business case is often a tricky proposition. We can’t point to the advertising guy and make it all about him. It is also important to remember that everyone inside the business creates content. And creators love their content like a mama loves her baby. Although the content may stink, we can’t call anyone’s baby ugly.

How do we build the business case for content marketing and answer the ROI question before we even really get started?

It starts by building a strong business case that doesn’t just directly attack people, their teams, or their budgets.

What is the ROI of content?

Let’s start with how we answer the ROI question before really even getting started. I point out that content marketing ROI is higher than the average marketing ROI in every place I’ve looked. At Content Marketing World, Julie Fleischer, former senior director for data, content and media at Kraft, said content marketing ROI was four times greater than their most targeted advertising.

At @KraftFoods, #Contentmarketing ROI was 4X greater than their most targeted advertising says @jfly Click To Tweet

The first step in responding to the content marketing ROI question is to ask for the baseline: What is your company’s average marketing ROI?

Then address each of these three components of ROI:

  • Cost
  • Utilization
  • Performance

Content cost: Conduct a content audit, or at least a sample of the content you produce. Apply some average costs and extrapolate to really gain a sense for how much your content costs.

Consider factors such as the cost to create the content including copywriting fees, design services, and don’t forget to estimate the cost of the time for project management.

Content utilization: Sirius Decisions has reported that as much as 60 to 70% of content goes unused. Any content that never gets used is 100% waste. You need to not only track content production, but also usage.

As much as 60 to 70% of #content goes unused according to @siriusdecisions #contentmarketing Click To Tweet

If you use an agency for your content creation, look at a sample of the content it delivered and then audit your external channels for any metrics of usage. If you use internal resources, ask the campaign managers for usage reports.

If you’re like most companies, don’t be surprised at how challenging it can be to track content usage.

Content performance: Most people start by talking about page views, social shares, and clicks. But it’s important to first tie your content performance to the business case that got you started in the first place.

For awareness and thought leadership content, it’s important to go beyond traffic metrics to look at engagement rates. Anyone can buy traffic. But engagement is the key in today’s attention-starved world filled with so many choices.

Anyone can buy traffic. But engagement is the key says @BrennerMichael #contentmarketing Click To Tweet

For lead-generation content, it’s important to look beyond leads to measure both the quality of the leads (conversion rates) as well as engagement.

How do you answer the content marketing ROI question:

  • Ask for your overall or average marketing ROI.
  • See if your business understands the cost of the content it produces.
  • Find out how much of it gets used. Ever. I’ve never seen any business over 50%!!!
  • Promise to build a business case and measure the return.

Build the content marketing business case

If you’ve survived long enough to want to learn how to build the business case, there are a couple of ways to create it.

Goal: Reach early-stage buyers. Most marketing content is overly promotional (and we tune it out) and is pushed just too early in the buying process. Your business needs to get people to know your brand, like your brand, and trust your brand enough to want to buy from you. That starts with a significant amount of early-stage “dating” content. It needs to be non-promotional and not overly creepy. You don’t want to push too hard at this stage because you want to get to a second “date.”

Most companies have a significant opportunity to reach more early-stage prospects. You can use these concepts to build the business case for content marketing in the early stages:

  • Your fair share of the conversations – What percent of online conversations on your product category are branded? What percentage of those conversations is from or about your brand? How different is that from your market share? If there’s a gap, it means your competition is wooing your prospects before you. For example if you have 25% of the sales in a product category, but your digital content only represents 5% of branded conversation online, you are not reaching your online fair share. Your SEO agency or even some of the SEO tools like SEMrush can provide you with your online fair share.
  • Unbranded search traffic on your website – How many of your early-stage prospects find your company website? You can identify this by looking at search traffic from brand terms vs. unbranded search terms. If you’re like most brands, you promote too much on your website and you need to build a brand publishing capability. If you write more about the trends in your industry, you will not only be seen as an authority, you will attract more unbranded search traffic.
  • Banner effectiveness at driving brand visits – If your company spends marketing budget on digital display (banners), test the effectiveness of this approach at delivering traffic to your website vs. content marketing.
  • Cost of advertising / search landing pages with low organic and social traffic – While advertising landing pages are built to deliver on the advertising message, measure the bounce rate of these pages and the amount of organic search or social traffic these pages get. Consider building a content marketing experience to serve as the landing page for your advertising. This will deliver “free” search and social traffic on top of your paid ad traffic.
  • Cost of organic and social website traffic vs. paid – 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 without buying it. One simple way to calculate this is to look at your average cost per click from paid search. Apply that number to your organic and social traffic to get the value of these visitors.
  • Cost of content that goes unused – While this business case applies to any buyer stage, it is often one of the biggest marketing expenses. And any content created and not used is just pure waste.

Goal: Engage new prospects with your brand: If you are not connecting with potential customers at the top of your funnel, there are a few ways you can quantify the opportunity to reach and convert them:

  • Time spent, bounce rate on content- vs. advertising-landing pages – This comparison should reveal how content marketing helps your brand reach early-stage visitors, engage, and convert them to sales.
  • Repeat visits, and time engaged with your brand – Repeat visitors came to your site once and then they came back for more. Measure the impact of these visitors by looking at their conversion rates vs. first-time visitors.
  • Value per subscriber – Quantify how many prospects you literally bring into the brand fold so you can start to market to them. You can quantify their value by looking at revenue or lead value from your email list divided by the number of emails you have in your database.

Goal: Conversions you would have never reached: Finally, you need to be able to measure content marketing in quantifiable ways that your business can understand such as leads, sales revenue, and retention:

  • Leads and sales from subscribers – Every lead you generate from content marketing can be valued. Anyone who registers for one of your white papers or events can be valued. Every subscriber you generate to build your list can be valued.
  • Content marketing ROI vs. overall marketing ROI – Once you’ve identified the previously detailed data, calculate the ROI of generating these subscribers, leads, and sales vs. the brand’s overall marketing ROI.
  • Retention and lifetime valueMeasure customers who engage with your content marketing and determine if they spend more or stay longer as customers. Content marketing can serve to deliver more engaged and profitable customers.

Conclusion

To answer the content marketing ROI question for your business, you need to build a solid case based on a deep understanding of your business.

What is your business’ average marketing ROI and how can content marketing achieve a higher return? The answer comes down to understanding your content costs, usage, and performance.

From there, you have a few paths to building a solid business case that will allow you to reach new customers, engage them with your brand in a meaningful way, and then convert them to new sales and long-term relationships that provide real ROI.

Learn more insights and practical tips from Michael Brenner in person when he presents at Content Marketing World this September. Register today, using the code BLOG100 to save $100.

Cover image by Joseph Kalinowski/Content Marketing Institute

Author: Michael Brenner

Michael Brenner is a globally-recognized keynote speaker on leadership, culture, and marketing. Co-author of the bestselling book The Content Formula, Michael's work has been featured by The Economist, The Guardian, and Entrepreneur Magazine. In 2017, Michael was named a Top Business Speaker by The Huffington Post and a top CMO Influencer by Forbes. Follow Michael on Twitter @BrennerMichael.

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  • heidicohen

    Michael–I love this. Content ROI explained in easy to understand terms. I agree marketers need to think in terms of how the content performs at different stages of the buying cycle. Part of the challenge marketers have in determining content ROI is believing it’s difficult to measure. You’ve got it down to cost, utilization and performance. Happy marketing, Heidi Cohen

    • http://www.b2bmarketinginsider.com Michael Brenner

      Thanks Heidi, I completely agree that we have to fight the notion that marketing is just an expense or cost center with results that are difficult to measure. As consumers engage with content digitally every single day, marketing has become so much easier to measure. And as content marketing seeks to educate consumers at each stage of buyer journey, we can track and measure ROI from the first touch to the last conversion, including retention and upsells.

  • Noel Wurst_Skytap Social

    Thanks for putting this out there, Michael, lots of great points. Not offering this as a counterpoint, just another way of looking at any non-finance ROI, but I wrote a piece earlier this year, after learning how L&D/training also struggles to prove ROI at times, and so much of my research in that area reminded me of my own team’s struggles. Would love to get a conversation going here, if anyone’s up for a healthy debate and discussion! https://trainingmag.com/it%E2%80%99s-time-training-talk-business

    • http://www.b2bmarketinginsider.com Michael Brenner

      Thanks Noel, Great article. I think you make many of the same points: start with a baseline, define what the business objective and measure results. One of the best ways I have seen training ROI demonstrated goes back to the book “The Service Profit Chain” – happy employees service happier customers who in turn spend more and stay longer.

      I could even argue that content marketing and training come from a common foundation: education, thought leadership and staying ahead of the curve (for customers or employees).

      • Noel Wurst_Skytap Social

        They absolutely come from a similar foundation – that was a fun realization (that we’re not alone!) and I think we both also have some old habits to break, i.e., collecting and reporting metrics that are unfortunately department-centric, and not as valuable to the rest of the organization. I see that trend changing, though!

  • Laura S

    I enjoyed the line “it needs to be non-promotional and not overly creepy.” Your content/early-stage dating analogy is perfect for framing this concept in understandable terms. Will be using this as an example moving forward when trying to describe the purpose and strategy behind some of our content.

  • http://callboxinc.com/ Judy Caroll

    Great article Michael. I love it. You just explained it using light terms in order to be understand by many. I agree with what you have said that “To answer the content marketing ROI question for your business, you need to build a solid case based on a deep understanding of your business.” Understand well what is your business all about to understand everything. Very well said and I am looking forward to read more of your articles.

  • paul johnson

    Great article Michael. Cost/ Utilization/ Performance make total sense in measuring ROI. I think I’ve got the cost and utilization down. Regarding performance I’m curious on any tips/ best practices on measuring the “R” for content (outside of just views and clicks). We use Google Analytics today (which I’m sure most people will agree is quite the headache). I’m considering using a platform like Hubspot or similar to pull together all touch points from specific content but hoping for any thoughts

  • rogercparker

    Very important “evergreen” article, Michael: 1,616 words that can help organizations of all sizes develop a meaningful framework for evaluating and improving their marketing. Strong writing.

    A lot of my enthusiasm for your article, of course, comes from, coincidentally, having just finished reading your The Content Formula, written with Liz Bedor. Your article and book make a great team; one motivates, the other provides the “hows,” i.e., the details, questions, and steps needed to put your ideas to work. A great 1-2 punch!

  • Mike Myers

    This is great, Michael. Your point about learning the typical ROI of marketing inside a business is spot-on (and in some cases, can be revealing). Everyone likes to scrutinize something new, like content marketing, but the ROI of anything in isolation is meaningless, you need to have something to compare it against. We suddenly received a lot less resistance when we asked for the ROI of existing activities (advertising, SEO, PPC, etc.) and realized, in many cases, it didn’t exist. 🙂

  • http://www.b2bmarketinginsider.com Michael Brenner

    Thanks Peter, you are absolutely correct. This article focused solely on content marketing reach, engagement and leads that originate mainly through a content marketing platform and approach. Leads you wouldn’t have achieved through other (mainly paid) means.

    Marketing ROI overall most certainly needs to address multi-touch attribution. This is a topic for a future post I think. 😉

  • https://writersperhour.com/ Anthony Bergs

    Some people may not agree, but still, content marketing in my top for ROI. It needs less money, but surely much more time to create a content marketing campaign, but according to my experience you will get highest ROI rates as a result. Great article, Michael.