How are you calculating the ROI of your influencer marketing on Instagram
There is a constant pressure to bring ROI to marketing investments. I’ve often felt that marketing is unfairly painted as a low sophistication aspect of business, when in fact it is actually dizzying in its complexity. The massive influx of media channels and types has made it increasingly difficult to understand the benefits, nuances and tools to use for executing marketing and generating real benefits to a business.
We’d like to break down the “What is my Return on Investment from ________ (insert any marketing tactic)” statement and see if we can make some sense of it.
Let me play dumb for a second and refresh myself on ROI or Return on Investment. According to Investopedia the definition in finance is as follows:
DEFINITION OF 'RETURN ON INVESTMENT - ROI'
- Brand share
- Social engagement
- Brand recall
- Brand introduction
- Customer acquisition
- Content Reach
Consider all the “why’s” and “what’s” on why you are doing a tactic and what you gain. An example of some aspects of ‘Gain’ not thought of in influencer marketing can be seen here.
To quantify the exact gain of each aspect of an influencer post is not a trivial matter. I don’t think it’s feasible to value each aspect, so here are some ways we are exploring helping make sense of return.
3 Tips for Marketing ROI Thinking
Align objectives and tactics - Surprisingly we find ourselves and many campaigns we see have misaligned marketing activities to the goals. Do a whiteboard customer journey and is it likely that you will insert the marketing in the right place with where your customer is and needs to be to push them through the journey. Prioritize the tactics you are going to use and consider experimental portions of a budget to push the thinking.
Aim Small Miss Small - This is a saying often used by marksman and great golfers like Jordan Spieth and others when talking about shrinking targets. The idea applies in marketing in that you can aim at a small target of people and still miss but hit a qualified target. Broad targets in marketing are likely to produce average results. Focus on a specific target audience definition.
Measure Success over longer arcs of time - We know the pressure of hitting short-term numbers; so don’t let this statement make you think we are out of touch. For new marketing tactics in new channels, the ability to understand whether that tactic is successful can take several trials and iterations of that. Define upfront what your tolerance level and the number of tests you need to see whether it is working. Defining the experiment threshold upfront will set the tone for the learning and prevent one campaign from defining the viability.