Home Digital Marketing Digital Marketing: What is ROI? How to Improve ROI?

Digital Marketing: What is ROI? How to Improve ROI?

How to Improve ROI?
How to Improve ROI?

In digital marketing, ROI is a tricky term. ROI helps you determine if you are successful or not. ROI has a quite simple formula. Improving ROI mostly requires a lot of effort and neat work.

ROI Formula 

Revenue (total income from sales)
Cost (how much paid for ads)

ROI Formula
Roi Formula

1: Revenue – Cost= X

2: (X / Cost) * 100 = Your ROI!

That simple?

Yes, and no. Be careful about the cost part!

We used cost as the expenses of paid ads, but as you can guess, our outcomes are not limited to the ad spending. For example; product, labor and shipping costs are our outcomes, as well, which means that our ROI can be lower than you might think. Therefore, calculating ROI is not very simple. In this part, our work shifts to the accounting part, however, as a digital marketer our mission is clear: increasing ROI with minimum cost! But, how?

If Possible, Start with ROI

Let’s assume that your company has an e-commerce store and your team wants to increase their product range with new types of products. Digital marketers can carry out a research to calculate ad costs, conversion rates, etc. If a certain product does not bring a good rate of ROI, a digital marketer should report it.

It might not seem like an easy job, but you should do whatever is necessary. Starting with a disadvantaged product may lead to high costs.

Let’s continue with a more common scenario: What happens if it is impossible to start with choosing a product or market?

How to Improve ROI?

It is a very broad question, it is similar to asking “How to be a perfect digital marketer?” (Hey! We have a post about it, too:). Yet, we have useful tips about how to improve your ROI.

  • Find the best medium 
  • Optimize your; 
    Campaigns (Google Ads, Facebook Ads or other) 
    Landing pages 
    Ad Rotations & Bidding 
    Check-out process 
  • Try to find the best campaign/promotion 
  • Test all of them! 

Finding The Best Medium

Every digital marketing medium has its advantages and disadvantages. If the customer does not insist on a specific medium, try to prefer the best medium for your market and target audience.

Let’s look at some examples.

Visual sector (e.g. decoration products): Social Ads, Google Shopping and GDN (also search)
Plumber, repair service: Google Ads
Innovative products: Video ad with social ads, YouTube and GDN

Optimize Your Campaigns

Campaigns: Google Ads (Check: Google Ads Guide 2019 Edition) and Facebook Ads are very complex and detailed ad platforms. Maybe, you have some room for changes, or improvements. Doing research for your market or talking with Google or Facebook representatives will be helpful.

Landing pages: The importance of improving landing pages is mostly ignored. Your ad can be perfect, but if your landing pages are not user friendly; sorry, but you are losing a lot of conversion.

Creatives: Facebook and Google Ads gives a great opportunity for testing and optimizing creatives, use them! Appealing creatives can increase your click through rate. Basically, high click rates tell to platforms that “Hey, this ad attracts attention, this ad should not be irrelevant.”

Ad Rotations & Bidding: Changing ad rotations and trying different bidding methods are also helpful. On Google Ads Smart, use Automated Bidding types utilized by machine learning and try to get it to make the best bids for you. Facebook Ads has great bidding types, as well. Business objectives of your customers play an important part when it comes to choosing a bid option.

Check-Out Process: Cart abandonment is a crucial problem in digital marketing. For example, if you show high shipping cost during the payment process, it will only result in cart abandonment. Making payment process easier will increase your conversions without changing the marketing budget. Cart abandonment campaigns are also recommended. You can set up re-marketing ads for the customers that have abandoned carts.

Make Promotions & Campaigns Better: Sorry, but if your product or service is overpriced or if your campaign/promotion are of bad quality, your digital marketing efforts will be in vain. Today, online users know and use price comparison, and price history checking. Check your customer offer, if it is not a real “campaign” or “promotion,” talk to your customer.

Test of All: Don’t be very sure! Test your bidding methods, creatives and landing pages. Shortly all of them! Just be careful about high cost tests, testing often can be expensive. Also, not testing can be very expensive, too!

Optimize Your Landing Pages for Conversion 

Landing page optimization is a must for conversion optimization. It is very hard to achieve success with improper landing pages.

It is technical, but affects your campaign performance. Check your site speed with (GTmetrix, Google Page Speed Insights) and send reports your developer. Just by improving site speed, you can boost conversions.

Unprofessional and boring designs will decrease your conversion rate. Using cliche stock photos, low quality images will effect your sales in a negative way. Moreover, design should have a well-thought hierarchy, for example, if your “Buy” or “Ad to Cart” buttons get lost in a page, it is bad. Avoid using bad typography or clutter designs.

Social Proof
Especially on e-commerce social proof, customer reviews are very helpful. If your customers leave good comments for your service or product, it is an advantage. Try to encourage your customers to make comments on product pages. Setting up comment rewards (ie. “make comments, earn points” campaigns) would be very useful.

Mobile Friendly
If your landing pages are not suitable for mobile, you will lose a lot of conversion. It will also help to add mobile friendly features (e.g. “Call-now, get my location”) to your website. No doubt that it will increase the conversion rates.

Naturally, people look at features of a product before buying it. If your landing pages lack information, it will have bad effects on your conversion rates. The amount of information is different in every industry. Product materials, features, using aims must be clearly described. If possible, try to enrich your content with videos and photos of the product.

Test and Analyze
Analyze your landing page performance with analytics tool (Google Analytics, Yandex Metrica, Heap) and make data-driven decisions. A/B testing tools will ease your testing process.

Closing Remarks

ROI optimization is like being successful at life; it is a never-ending process. Try to do your best. As I said before, ROI optimization is not only related to digital marketing. For example, if your customers are dissatisfied with your products or services, your LTV will be low. You should be a great communicator to avoid such a case.


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