Wednesday, 6 August 2014

Top 10 reasons why your digital marketing has negative ROI

Investing in digital marketing is a no-brained for businesses today. However, there are several examples where companies have experienced negative ROI on their digital marketing efforts, despite adopting supposedly the sure-shot marketing strategies of digital marketing. Then what exactly can be reason of the failure of this new and effective marketing channel of contemporary world? Let us explore some top reasons:

1. Not setting clear objectives

Planning and laying out clear objectives plays a vital role in the success of the entire digital marketing campaign. You may perhaps choose digital marketing services in a dash, but then what you will experience is exactly what we are discussing here. By making wrong choices of digital channels and how to use them, and not setting goals will most likely ensure that you don’t get positive returns on your investment. For example, if you are simply buying likes on your Facebook page without understanding the value of each like and how it aligns with your marketing goals, the money will not be well spent.

2. Not defining and tracking performance metrics

We all know that people adopt digital marketing because it allows you to measure the response of your target audience right away. It offers you an ability of quantitative measurement of the results. Despite such advantage, if you are not defining or pre-planning the performance metrics and going in a direction without a track, you will definitely be lost! It is absolutely imperative that you define and track your performance metrics right from stage 1. You should have clear metrics and performance criteria for each and every campaign. In search marketing, your metrics could be leads, conversions, Cost per lead, cost per conversion, cost per acquisition and so on. In social media marketing, you may want to look at reach, engagement, followers etc. On your website, you may want to look at traffic, time spent, target audience etc. As they say – what gets measured, gets done. So, by measuring the right things, you can keep your digital marketing on track.

3. Having a short term view and expecting too much too soon

Most digital marketing channels will not yield results from day 1. Success requires careful planning, tracking, refining and monitoring. Therefore, it is imperative that right from the beginning you segregate or at least define your long term and short term objectives and manage your efforts accordingly. Expecting results suddenly will land you in disenchantment. In this day and age where market is getting more and more crowded, getting customer’s attention is increasingly difficult. Therefore, patient and persistent efforts in the right direction are key to generating positive ROI in your marketing.

4. Resource Starving

Resource starving means that you are not properly allocating your digital marketing work to professional suited for this job. If you are cost cutting here and appointing interns for creation or implementation of your marketing strategy, then there is a high possibility of negative ROI. Digital marketing is a new and evolving field and experts who are on top of this field are better suited to understand and leverage it. Therefore, it is crucial that you allocate the right resources to it. 

5. Improper Budget Allocation

If you are treating your digital marketing strategy as something that you just want to check off your list and are not allocating proper budget to it, you will get exactly what you are paying- little or no results! For effective campaign and higher ROI, you will have to infuse the right cash flow in your marketing. Deciding how much to allocate to your digital marketing and knowing how to allocate the spend among various digital channels is directly linked to ROI. 

6. Copycat Marketing

This is yet another mistake that an organization makes. It is not necessary that a marketing campaign which has worked for your rival will also flourish for your business. No matter how similar your lines of working are, but every business needs a separate marketing treatment. Copycat marketing by blindly following competitor’s strategies and not understanding your customers’ need will land you nowhere and your entire resources and finance will sink badly. 

7. Not Optimizing and Redefining Strategy 

Digital marketing requires ongoing effort and involvement. It is not something that you can do once and leave. You have to optimize and redefine your strategy. Constantly tracking metrics, monitoring campaigns and aligning them with your goals is required to make digital marketing a success. Anything short of that may lead to negative ROI.

8. Using traditional sales push approach versus pull

If you are adapting to newer marketing approach by using digital marketing, you also need to adapt to newer strategies. The traditional sales push approach will not work here. Just bombarding your prospective customers with messages about your products and services will lead you nowhere. Even if your business is providing no goods or services and is purely information-based, make sure that you still offer something worthwhile and meaningful to your customers so that they return to your business. 

9. Having a checklist approach to marketing without really understanding and investing in each channel

Create a website – check. Create a facebook page - check. Hire someone for basic SEO – check. Several businesses have this approach to digital. This approach is guaranteed to fail. Having a website but not making the website user friendly or relevant to your customers will lead you nowhere. Having a Facebook page but having few followers or low engagement will not serve any purpose. In case of limited budget, it is better to identify a few channels but utilize them properly.

10. Inconsistent Strategy

Finally, if you have inconsistent strategy in your approach towards marketing, you will never attract desired ROI results. Haphazardly giving delinked messages across your different digital media and traditional media platforms will not fetch any results because it will be like sailing in a lot of boats at one time. Therefore, it is important to have well-aligned and consistent strategy across different platforms but with a common vision. 

Understanding the aforementioned reasons will help you in getting better insight into how your digital marketing strategy should be planned and also how you should leverage the various channels available to you. Digital marketing if done right has the potential to yield significantly higher ROI than traditional channels!

For managing your Digital Marketing Campaign

1 comment:

  1. Great article, Thanks for your great information, the content is quiet interesting. I will be waiting for your next post.