Return on investment is one of the major, if not the major, factor that any business should measure. That applies for every investment a company does and marketing is no exception. Digital marketing has a lot of possible channels and strategies that you can use to communicate with your customers and not all have high return on investment.
Being able to have a supported and constant high average ROI on your digital marketing is crucial for your business to maintain reliable growth, as it is one of the true golden rules for any business. It basically tells you for each euro you invested what was the outcome you achieved, or in order words, how much revenue did that euro generated.
So which type of digital marketing strategy delivers the highest ROI?
Of course, you need to understand the basics of the possible digital strategies you can use, and we can divide them into outbound marketing and inbound marketing strategies. In a very simplified way, in Inbound Marketing we want the customer to be attracted and come to us, in Outbound Marketing, we go after the customer. If you do not know what digital marketing is and what strategies and tools exist, you can visit our post about it.
Both inbound and outbound strategies have their strengths and downfalls and each focus on using different marketing channels/tools but if we could use any of these tools/strategies regardless of the bottom line strategy this would be the ranking according to ROI.
1.Search Engine Optimization
SEO stands for “Search Engine Optimization – Search Engine Optimization”. In simple terms, it means the process of improving your website to increase your visibility in relevant searches. The better your visibility in search results, the more likely you are to attract attention and attract existing and potential customers to your company.
One of its main advantages is the low costs this strategy can have and done the right way it can deliver very significant long-term results. A survey performed by SmartInsights, (Technology for Marketing) and eCommerce expo made to 609 senior marketers across the world showed that the majority of the inquired thought that SEO, is the channel with highest return on investment, when compared to other digital channels such as social media, paid search advertising, and e-mail.
SEO takes time to perform real effects, but once it starts working is unparalleled. According to the brightedge report. 51% of website traffic comes from organic search results
This makes SEO one of the best digital marketing strategies for average revenue return. There is a difficult initial hurdle that takes times, regarding the optimization of site’s structure, content/keyword density, meta descriptions and mobile friendliness – but an optimized site has the potential to grow in rankings over time and passively deliver ROI for the following years.
To know more about SEO read the article we posted in our blog.
Compared to other marketing channels, email marketing costs very little. For each € 1 spent, € 44.25 is the average return on investment in email marketing.
But why does email marketing outperform other channels so significantly when it comes to ROI?
It all comes down to delivering highly personalized and relevant messages. Unlike social networks where updates are sent to each follower, regardless of their location, interests and purchase history, e-mail allows you to be hyper-targeted in your communications.
The more information you have about your customers with an email marketing tool, the more targeted and accurate you can be.
This segmentation and dynamic content helps to ensure that the content you send is relevant to each recipient and that relevance drives people to click, make purchases – and increase the ROI of your email marketing campaigns.
A study carried out by Monetade, indicates that 4.24% of email marketing visitors buy something, compared to 2.49% of search engine visitors and 0.59% of social networks.
This strategy’s main drawback is that it requires a proactive campaign to maintain the contact database in order to reach out to customers. These contacts databases take time to create but a business willing to pursue this type of online marketing will be able to expect good average results.
To know more about e-mail marketing see our 7 reasons to bet on e-mail marketing article.
3.Paid Search Marketing
Paid search is not the channel with the best ROI out there, but it is definitely the fastest in terms of results. This is probably the reason why it is here where companies spend the highest amount of their digital marketing budget.
Also, if done in the correct way, it provides a very quick ROI for new businesses looking to grow traffic fast, or for sites that want to capitalize on a short-term window.
Paid search advertising involves paying to have ads appear next to regular search results. The main platform for this is Google Ads (formerly known as Google AdWords), the biggest search engine in the world and in Europe represents 93.4% of the total market. Another choice is Microsoft’s Bing, with it you can advertise in Bing and in other search engines such as Ecosia.
If you want to get to know the search engine market share in Europe visit our blog article that we update every month.
According to Google for every €1 spent on Google Ads, businesses earn an average revenue of €2, which is a very decent ROI. Although these high returns, be aware that this is very methodical and hard work, especially if you want to have results that really compensate your investment you need to have a very strong keyword strategy and follow-up.
Find out more about Pay per click advertising on our blog.
Did you know that more than 45% of the global population uses some social network, in the most developed regions, the use of social networks reaches 70%. There are already more than 3.5 billion people, joined daily by online platforms! (Global Digital 2019).
Social media has quickly gained its way to become one of the best new channels for digital marketing growth. Advertisers have learned that social media provides unique opportunities in both paid and organic channels and having the possibility to interact with shoppers directly.
1 in 4 U.S. shoppers now claim to prefer being contacted by brands via social media, making platforms like Facebook, Instagram, and LinkedIn crucial for inbound marketing growth. With the ability to curate a brand presence also comes the opportunity for marketing your services and eCommerce products. Marketers rank social among their top strategies with nearly 20% saying it offers them the highest return.
Facebook advertising represents the best channel for ROI, with Facebook services like advertising for Feeds, Messenger, Marketplace, and Instagram representing the greatest opportunity for delivering results.
Read our blog to know more about social media strategies.
Need help creating your digital marketing plan? The Link37 digital marketing agency is the ideal partner! Get in touch with us! We can help by freeing you time to devote to what is most convenient for you.