In its simplest form, return on investment (ROI) is expressed as a formula. (Revenue – Cost) / Cost, multiplied by 100 (to display the percentage increase). So, if a particular marketing effort drove $1,000 on a cost of $500, the ROI would be 100 percent – basically doubling a marketer’s money. Pretty straight-forward, right? But figuring out the ROI for content efforts can often be one of the trickiest aspects for any marketing department.

The reason is that oftentimes there might not be a direct link between a return (typically in terms of revenue) and the efforts of the marketers. A simple example: Let’s say Home Depot produces a how-to video on changing a kitchen faucet.

All in, the shoot might take one day, with a professional crew and cost $6,000 for the various camera angles, lighting, and production set up. For post production, let’s assume that it costs another $12,000 to edit the video (as a 12-minute video could take up to two weeks). So, for that single video, it costs $18,000 just for production and post-production. Add in marketing and a few other costs to distribute it, let’s assume out the door it costs $25,000. We don’t know the truth but let’s just assume for these purposes. We do know the video itself garners more than 700k views. But how does that video translate into sales? There’s no direct measure for it in terms of dollars. The video’s purpose was likely to be twofold: 1. To be helpful for potential customers and create the impression that Home Depot understands the particular home improvement challenges that customers face and; 2. Keep the brand top of mind when consumers need to buy the products or tools for their specific project.

Could you measure sales of new kitchen faucets or basin wrenches from the pre-video time period to the post-video time period? Sure. But that wouldn’t necessarily tell you the sales all came because of this specific video nor would it detail all the benefits of producing that video for the home improvement retailer. For those reasons, marketers sometimes refer to ROI loosely (equivalent to whether or not something was worth the investment) and might use more general performance KPI measures (views, brand lift, comments) rather than strictly putting ROI in dollar terms.

That is, if they are able to get such videos approved in the first place. If you think about it, many marketing departments face their biggest challenge in convincing leadership to invest in top-of-the-funnel marketing or accepting metrics that aren’t necessarily revenue-based for each campaign. That’s why it’s important for all stakeholders to be on the same page about what constitutes a “return.” Given that the end goal of most marketing is typically a conversion of some kind – revenue, sales, or lead generation/registration – one option is for your “return” might be measured in aggregate, as the sum of all campaigns. And then measure the individual campaigns in terms of the KPIs toward that goal where you can measure and benchmark impressions, a brand lift, views, interactions etc.

What’s the True Value of a Piece of Content? Think About Attribution

As alluded to above, attribution – the way to credit a particular content piece with driving a conversion or revenue – is sometimes complicated. To illustrate this, consider the following typical scenario: Consumer A searches for “how to put on a spare tire” and finds and reads an article on the topic by Company X, which sells car tires online. Let’s say the article helped the user so much that he or she signs up for Company X’s email newsletter. Company X then sends an offer via the newsletter for 40 percent off its radial tires. Knowing the importance of changing the spare tire eventually, the user bites on the offer and makes a purchase online with the discount.  

So, what content piece was responsible for making the user purchase: Was it the “How to Put on a Spare Tire” piece or was it the newsletter? For attribution, the answer is both. The content piece (“How to Put on a Spare Tire”) might be given “time-decay” attribution. The other (the newsletter) is given last-click and a large piece of time-decay attribution. Here’s a quick explanation of each:  

Time-Decay Attribution. Marketers look at time-decay to analyze all the touch points that contributed to help make a sale. For example, good companies know a lot about individual customers – when that person visits a particular page, interacts with an ad in paid search, opens an email, or clicks on a particular social post. All those interactions by that customer get essentially “weighted” in terms of a contribution made toward an eventual purchase. The weighting is often based on recency (the more recent, the more heavily weighted), hence the term time-decay. But how do you weight each touch point? For instance: How much does a touch point from 6 months ago count versus one in the last week? How about the weighting the original touch point? That’s the tricky part and creating the wrong model can skew the data to make it seem that some touch points are more important than others.     

Last-Click Attribution. This is the attribution given to a content piece, email, ad, etc. that made a customer finally convert. Why is it good to know this piece? It’s useful in that some content is developed specifically for that purpose – to put a potential customer over the top and convince them to buy. So, knowing what content “works” in this sense can help marketers understand what other types of content to produce and maybe whether or not to increase distribution for that effective content piece. However, only focusing on last-click, will skew the credit toward that last touch point, when, in fact, the content used to make that individual aware of a company or product might have been just as important.  

Conclusion

Determining the ROI for a single content piece is often complicated for these reasons. What’s perhaps most important is documenting a content strategy upfront and agreeing with the various stakeholders on both the broader goals and individual metrics and benchmarks that constitute success along the way. Ultimately, those measures should reflect the steps in the buyer journey accurately, which is never an easy thing to do. However, the closer companies can get to this, the better case marketers can make to invest more in those right pieces going forward.