ROI Calculation on Online Advertising Spend

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ROI Calculation on Online Advertising Spend

By Arnab March 20, 2007 filed in Miscellaneous, Internet Marketing

Today the ROI on advertising spend can be fairly calculated by the innovative measurement techniques that have been developed. These can to a large extent provide us the effectiveness of advertising campaigns and thereby calculate ROI.

There are many forms of internet marketing measurements - the most common among them is Pay Per Click (PPC). This measurement allows companies to count the number of clicks the user has made on a specific banner or advert. As the name suggests Pay Per Click is priced Per-Click on the advert. This, by far, is the best form to calculate ROI with every click the advertiser getting back his money worth.

The next measurement form is called the Search Engine Optimization – this is a process of designing and adjusting parts of a website to rank highly on the search engines results pages and involves a lot of work off-site as well. Search Engine Optimization if done successful will obtain a high position for specific keywords and keywords phrases related to the advertising company, it’s products and or services in the free results. This needs an intricate technology backend but surely delivers results in terms of calculating ROI.

Website Lead Generation is the sign of a good Internet Marketing Company. Lead Generation takes all the risk out of a marketing campaign by providing a Company with qualified leads at a set price per lead. Lead Generation is offered by telemarketing Companies who have large amounts of Sales Staff cold calling people to generate enquiries. This method of Lead Generation is often successful but expensive. An Internet Marketing Company can produce qualified leads by creating a website specific to the target Company’s products or services and promoting it with their desired type of Internet Marketing. Unlike cold calling, website lead generation has people who are actively seeking the product or service, approaching and enquiring via the website. The close rate between the two is significantly different with website Lead Generation out performing telemarketing by more than twofold. With the success on the leads generated, advertisers can easily determine their ROI from this exercise.

Pop Ups or Pop Unders or whatever you want to call them are quite simply one of the worst forms Internet Marketing only better than email campaigns which are just as useless. A Pop up displays an advert of website in a new window when you visit another site, a Pop Under inserts the advert under the page you are viewing so when you close the window down, your presented with it. Most times people see them loading up, they are able to close the window before they’ve fully loaded. In recent times Pop Ups have become much less popular, being made redundant by most browsers and most people using Pop Up blockers to escape this nuisance. While these services are cheap they are practically useless!

If you have an eMail account, no doubt your have a spam problem as well. eMail campaigns used to be an OK method of Internet Marketing but due to the cheapness of campaigns and lack of governing, have been totally abused. The problem is that everyday people wake up to an enormous amount of spam eMail selling anything from the enlargement of certain body parts, to car insurance and equity release mortgages. People are just used to deleting anything that looks like spam, with your eMail as well. Not only that, but targeting personal eMail addresses in the UK is illegal. We’re not saying an eMail Marketing Campaign will not generate sales but rather the conversion rate is so poor compared to other types of Internet Marketing E.g Search Engine Optimisation or Pay Per Click Advertising, your simply better off investing your money else where.

Web Banner Advertising is a type of Internet Marketing where by you pay another website an amount to display an advertising banner on their website for a certain length of time. The web banner links directly to your website, tempting visitors away from theirs and onto yours. Some times advertising on another website in the form of a banner advert can yield a fairly good return. However, advertising on a website that has little or nothing to do with your target audience involves high levels of luck to convert any sales, producing little to no ROI. However if similarly themed websites covering a similar topic is used the results can be productive. This is the only way of maximizing the impact of such a campaign.