Your company has a finite amount of resources for marketing. Broadly speaking, it makes sense to put more resources toward online marketing than toward traditional or legacy marketing because the ROI of digital marketing is higher. This is logical. Not only is the internet now most people’s first source of information, the costs are clearly lower. Taake a moment and compare the cost of sending out a physical newsletter ($3,000) with the cost of sending a digital newsletter ($100) — the specifics may be different for different companies, but the difference is so enormous that no degree of individual variation is going to change the fact that it’s cheaper to send an email than to print, copy, and mail a newsletter.
Go ahead and take as long as you like to compare the price of TV commercials and YouTube, pay per click ads and billboards, an e-commerce website and a physical store… online marketing is cheaper.
Consumers also trust online content more. There are untrusted online marketing ploys — texts from brands, for example, are trusted less than TV ads. But your brand website is second only to recommendations from friends.
That’s really not the issue these days, though. Most of us know by now that, even if we want to use traditional broadcasting for the prestige value or to reach our particular demographic, digital marketing is the more cost-effective use of our marketing resources.
How do you decide how to divide your marketing resources among your various digital marketing channels?
First, make sure your chosen digital marketing channels are getting a fair chance to prove their worth:
- Make sure you can track them all through a single source of data. We use Google Analytics most, and it’s easy to track all kinds of digital media through GA. If you prefer another source of information, that’s fine. You can’t compare multiple sources of information, though. If you get figures from your Chamber ad from the Chamber and your online video from YouTube and your blog posts from the blogger, you guarantee that the numbers will not be comparable.
- Make sure you’re trying each option for a reasonable length of time, and that each one is getting a similar opportunity. The speed of the internet can make us think that we’ll be able to tell the value of an online marketing campaign quickly, but human beings haven’t changed — we still need to connect with a message 5-12 times before we take action.
- Make sure that you have accurate costs for each of the channels you’re tracking. If you have a flat monthly fee for one, another has a cost per click, and a third is done in-house, the costs might not be immediately comparable without a little math.
Then track the channels you want to compare for a few months. At that point, you can segment out the various traffic sources in your Google Analytics and compare.
Once you define segments, all the reports at GA will look only at those segments, so you can look at sales or other conversions and compare the behavior of visitors who have arrived via your various online marketing channels. If your YouTube visitors spend twice as much as your Pinterest visitors, it might make sense to devote more resources to your YouTube channel than to your Pinterest boards. On the other hand, if your YouTube channel costs you ten times as much as your Pinterest board, the situation changes.
The easiest way to make a useful comparison is to look at the ROI (return on investment) of each channel. If you see sales of $14.00 for each $1.00 spent at one channel and sales of $2.00 for each $1.00 spent on another channel, you have a fairly clear comparison.
Before you make a final decision, though, be sure to use your web analytics to determine whether the channel in question is important in getting people to a place where they can decide to make a purchase or to make other kinds of conversions, such as subscribing to emails, downloading coupons, or sharing with others who make purchases later.
Need help figuring all this out? Contact Rosie at Rosamond@HadenInteractive.com. We’ll be happy to help.