Estimated revenue or revenue influence is calculated by “guessing” how much revenue an action will generate. There are several online models where you do not have a direct line to impact ROI. You do, however, have influence. The following list shows direct and indirect actions that can impact ROI. Understanding attribution models such as direct influence versus indirect influence will enable you to have a much deeper understanding of your impact on ROI. Direct influences are measurable and attributed to sales through very clear channels (such as coupons, or referral IDs). Some actions may fall into both categories, depending on whether you apply a cost to them online:
• Offline sales (indirect or direct)
• Lead generation such as email opt-ins (indirect or direct)
• Relationship management such as PR and influential marketing (indirect)
• Purchases (direct)
• Downloading software (indirect or direct)
• Downloading a white paper (indirect or direct)
• Using a specific tool on your website (indirect or direct)
• Sharing content through social media (indirect or direct)
• Clicks on an ad (indirect or direct)
• Referrals to other sites (indirect or direct)
Using the example of selling products offline, you may need to make an estimate as to how many of your users will actually make a purchase offline. To arrive at this estimate, you can partner with a company such as ComScore or Compete to get industry analysis based on user panels, or you can gather data yourself by conducting surveys on your site (there are any number of online survey options, such as Survey Monkey). Surveys are a good way to find out about your users’ buying intent. You can trigger surveys after specific actions, such as using a “help me choose” tool or an interactive demo, and you can ask the respondents targeted questions such as whether they intend to purchase a product, if they found the demo useful, how much they are planning to spend, in what time frame they plan on purchasing a product, and if they have purchased anything recently. Surveys are a very useful tool when used well.
The feedback you get from survey questions such as “Do you plan on making a purchase?,” “How much do you plan to spend?,” and “When do you plan on making the purchase?” will allow you to create some estimates. Based on sampling data, you can derive the average expected spend, and how close your customers are to making a purchase. This latter point allows you to identify whether a particular action is more likely to be taken by people closer to or farther from making a purchase. Using this data, you can also see if there is a variance in average estimated revenue based on how close the customers are to making a purchase. The closer to purchase a customer is, the more likely it is that she has an idea of her budget; however, this number is typically on the low side, as the customer is shopping around and looking for the best deal. This is actually a good thing, as it’s better to use conservative estimates when setting expectations. It’s usually better to overperform than underperform.
In the case of email opt-ins or other lead-generation activities, you can establish a value per lead or name captured. Dividing the total number of leads by the average revenue generated by the leads will provide you with an average cost per acquisition.
It can be trickier to attach a monetary value to PR and marketing efforts, but it is still possible to establish an estimated impact to revenue. In very simple terms, advertising spend is typically based on the number of people it can influence—meaning that for each set of eyeballs there is a positive value or potential influence. If you understand the value of the eyeballs, you can create an online strategy that has an ROI comparable to that of your offline strategies. Consistently benchmarking across all routes to market allows for informed decision making.
Your estimated ROI will be captured as the revenue estimated through surveys and panel data to be based on an action on your website that influenced a sale that was not trackable directly by your metrics suite. The ROI formula remains the same.
Source of Information : MASTERING SEARCH ANALYTICS MEASURING SEO, SEM AND SITE SEARCH
• Offline sales (indirect or direct)
• Lead generation such as email opt-ins (indirect or direct)
• Relationship management such as PR and influential marketing (indirect)
• Purchases (direct)
• Downloading software (indirect or direct)
• Downloading a white paper (indirect or direct)
• Using a specific tool on your website (indirect or direct)
• Sharing content through social media (indirect or direct)
• Clicks on an ad (indirect or direct)
• Referrals to other sites (indirect or direct)
Using the example of selling products offline, you may need to make an estimate as to how many of your users will actually make a purchase offline. To arrive at this estimate, you can partner with a company such as ComScore or Compete to get industry analysis based on user panels, or you can gather data yourself by conducting surveys on your site (there are any number of online survey options, such as Survey Monkey). Surveys are a good way to find out about your users’ buying intent. You can trigger surveys after specific actions, such as using a “help me choose” tool or an interactive demo, and you can ask the respondents targeted questions such as whether they intend to purchase a product, if they found the demo useful, how much they are planning to spend, in what time frame they plan on purchasing a product, and if they have purchased anything recently. Surveys are a very useful tool when used well.
The feedback you get from survey questions such as “Do you plan on making a purchase?,” “How much do you plan to spend?,” and “When do you plan on making the purchase?” will allow you to create some estimates. Based on sampling data, you can derive the average expected spend, and how close your customers are to making a purchase. This latter point allows you to identify whether a particular action is more likely to be taken by people closer to or farther from making a purchase. Using this data, you can also see if there is a variance in average estimated revenue based on how close the customers are to making a purchase. The closer to purchase a customer is, the more likely it is that she has an idea of her budget; however, this number is typically on the low side, as the customer is shopping around and looking for the best deal. This is actually a good thing, as it’s better to use conservative estimates when setting expectations. It’s usually better to overperform than underperform.
In the case of email opt-ins or other lead-generation activities, you can establish a value per lead or name captured. Dividing the total number of leads by the average revenue generated by the leads will provide you with an average cost per acquisition.
It can be trickier to attach a monetary value to PR and marketing efforts, but it is still possible to establish an estimated impact to revenue. In very simple terms, advertising spend is typically based on the number of people it can influence—meaning that for each set of eyeballs there is a positive value or potential influence. If you understand the value of the eyeballs, you can create an online strategy that has an ROI comparable to that of your offline strategies. Consistently benchmarking across all routes to market allows for informed decision making.
Your estimated ROI will be captured as the revenue estimated through surveys and panel data to be based on an action on your website that influenced a sale that was not trackable directly by your metrics suite. The ROI formula remains the same.
Source of Information : MASTERING SEARCH ANALYTICS MEASURING SEO, SEM AND SITE SEARCH
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