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How do I measure content strategy ROI?

How do I measure content strategy ROI?

Content Strategy ROI by Shelly Bowen, Pybop LLCContent strategy ROI is always big concern, as it should be. It seems hard to measure, because content has both immediate and long-term, tangible and intangible effects on a business. How do you know if it’s worth the investment?

Luckily, one of my favorite Confab 2012 presentations last week by Melissa Rach addressed just this issue. Her presentation on the economics of content strategy is here.

Essentially, she broke it down like this:

Value = Benefits – Costs

That’s the formula: value = benefits – costs. It’s simple, yet brilliant. First, consider the benefits — and the corresponding monetary value — of your content strategy. Then determine the value of each one and add them up. Like in this example:

Content Strategy Benefits

Monetary Value

Gain new customers. Value of 1 customer X number of additional customers you may get.
Reduce customer service calls. Value of your customer service rep’s time X amount of time gained by reducing calls.
Improve internal efficiency. Value of 1 writer and developer’s (for example) time x time gained by streamlining processes.

 

If you’re in a professional industry, one new client might mean an additional $10,000 – $100,000 or more over the course of a year. If you’re in consumer goods, a 10% increase in sales might also mean hundreds of thousands of dollars.

Other measurable monetary benefits to your organization might include:

  • Faster speed to purchase
  • More self-selecting traffic and customers
  • Increased repeat visits, clicks, and/or purchases
  • Increased word of mouth
  • Decreased new content costs via repurposing and structuring
  • Additional signups
  • Increased time spent on site

Multiply by Certainty

Not 100% positive of the effectiveness of your content strategy? That makes sense — many factors will influence success, including things out of your control, such as a competitor product launch, economy shift, staff reorganization, or seasonal changes. Melissa Rach suggests figuring out how sure you are that content strategy will benefit your company — 75% sure? 85%? Then multiply that by the value you came up with above to determine a range.

$100,000 potential value X 75% certainty = $75,000 value

Once you know how much the benefits of content strategy are worth to you, it’s much easier to make a smart decision about the costs.

The Costs of Not Practicing Content Strategy

The costs aren’t limited to paying for the creation and implementation of your content strategy. At Confab, several speakers, Including Anne Rockley, president of the Rockley Group, told true stories about the costs of choosing not to invest in strategy or implementation.

In one story, workflow oversight of the content strategy was cut back, and a message intended for staff was published publicly. The information cost them not only embarrassment, but also potential investment, and the company went under.

What’s the Value of Content Strategy to Your Business?

Consider the monetary benefits to your company, the costs of the strategy design and implementation, and the potential costs of not giving your content the attention it needs, and you should have a strong projected ROI.

 

Author Shelly Bowen

Shelly Bowen, Pybop's chief content strategist, has led teams of writers and creatives to develop websites and interactive content for more than 15 years. Read more about Shelly.

Contact Shelly

Join the discussion 2 Comments

  • arpieb says:

    As a finance major, I remember how fuzzy it was to calculate ROI from hard numbers out of sales reports, balance sheets, and income statements. The assumptions were always in the numbers being an accurate reflection of what was put into generating revenue, which tend to be pretty hard figures.

    Although the formula you present is, “simple, yet brilliant,” it is very difficult to assign values to when it comes to most marketing programs, and even more so when it comes to online marketing programs. Taking assumptions from the slideshow referenced, did you lose a sale to garbled content, or because of the economy? If shipping cost is a factor, content per se had no impact whatsoever – unless maybe stating it earlier in the process skews the numbers to 10-for-10 on closed sales versus 10-for-50 (which did not increase your revenue or in turn ROI, only your closing rate).

    With additional privacy concerns and crackdowns, reliably tracking these metrics is going to only become even more difficult as users are surfing the web more anonymously. Thought Nielsen ratings were fuzzy at best…?

  • Shelly Bowen says:

    Thanks, Arpieb, for your comment. I agree the assumptions are just that — assumptions. We’re making educated guesses about almost everything that goes into the formula. But it provides a place to start … a way to frame up the benefits and costs and make more educated decisions about time, budget, and resources.

    It’s true, there are potential costs or impacts that are outside of the control of content — such as the economy. But looking at those costs can help a business decide where to focus. I don’t think we’re trying to determine whether it’s the economy or garbled content that’s to blame; rather, we’re just looking at all contributing factors to potential success.

    Thanks again!

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