A prospective client asked me how much return on investment (ROI) is realistic for a content program (or what we lovingly call a buffalo program). Of course, it depends on the buffalo strategy, relevance of your content themes, how well you promote the content, market demand for your product or service and your pricing strategy — among other factors. But, here are some strategic ways to ensure you achieve a healthy ROI with the buffalo program:
Align Content With Product Capabilities and Market Needs
Make sure your topic and themes are closely aligned with your product strategy and customer needs. Sometimes, marketers select themes that are hot topics, but that are not closely aligned with their product strategy or current market demand. In this case, they might see lots of engagement, but no impact on sales. This is common if you pick topics like high frequency equities trading or proprietary trading, where there is still a great deal of market interest, but not much demand.
Manage Customer Expectations
If your content sets customer expectations too high, it can have a detrimental impact on sales and post-sale relationships. For example, one client we worked with, a financial technology vendor, got overly excited about promoting one of their offerings –a trading solution that customers could build with their product. They asked us to develop a white paper related to the trading solution. Not understanding the limitations of the product, we created vision on the capabilities of the solution. This was a mistake.
What we realized later was that to accomplish that vision, customers would have to invest in extensive internal development. Unfortunately, our content did not effectively set that expectation. So prospects got to the proof of concept stage, but then didn’t purchase because the product didn’t live up to expectations. We failed to be customer-centric and empathetic, and it impacted sales.
As marketers, we have a responsibility to be honestly empathetic about what’s needed to achieve the vision we’re creating. Otherwise, we’ll create distrust in the market.
Be Consistent With Your Content Strategy
We often see marketers investing in big premium content like white papers and research reports, but then they get too busy and either don’t promote the content effectively or are not consistent about marketing it over time. In those cases, the return on investment of marketing content is usually pretty poor. This is why we created the buffalo strategy.
A content strategy takes time and consistent feeding to germinate and produce fruit. You should assume that you’ll need to consistently publish high quality, relevant and engaging content for at least 6-12 months before you start seeing a return. Here’s a blog post that explains this concept: Does Content Marketing Actually Work?
Another common mistake is when marketers run content campaigns that generate lots of leads, and then fail to nurture them. Don’t forget that most of the leads you generate in a content marketing campaign will be in the early stages of their buying process. I’ve seen various analyst reports suggesting that 60-85% of all qualified leads (meeting demographic and target market qualifiers) will be early stage. This is of course dependent on the kind of content you publish, the methods you use for distribution and promotion, and the typical length of the customers’ buying cycle.
Sales teams are generally not very well-equipped to nurture early stage leads. So if you don’t nurture these opportunities in marketing, you should expect for at least 84% of your qualified early stage leads to fall through the cracks before they’re ready to buy. Since 80% of those qualified leads will eventually go on to buy from someone, it makes sense to invest in nurturing them.
Reduce Cost Per Lead With An Inbound Marketing Strategy
HubSpot published research on the cost of lead acquisition and found that “inbound marketing-dominated organizations experience 61% lower cost per lead than outbound-dominated organizations.” That does not mean that you can rely completely on inbound marketing strategies for all your lead generation and lead nurturing, but it does substantially reduce the cost per lead and the cost for ongoing lead nurturing over time.
Go For Quality over Quantity
Marketing strategy effectiveness should not be measured purely on volume of leads generated. Quality is much more important than quantity. It’s important to set expectations internally. I’ve seen some programs generate 2,000 new leads, but only 3-4 active sales opportunities, while others generated only 150 new leads, but 10 active sales opportunities. So which has the better ROI?
Check out Ardath Albee’s blog post on this subject, where she talks about picking the right metrics:
In it she compares two scenarios:
- In Campaign 1, Marketing generated 1,000 leads which resulted in one sale.
- In Campaign 2, Marketing generated 147 leads, sales has accepted 80% of them and has already had meetings with 50 of them. The pipeline forecast is 6 deals so far based on leads that have identified projects and budget.
So How Do We Measure ROI of Content Marketing?
It’s important to think about your content marketing program over the long term, not the short term. Expect to begin seeing some results in 5-6 months, but the real return won’t be captured for about 24 months.
Eloqua (Oracle) and Kapost published an e-book last year on calculating the ROI of content marketing. It shows a substantial drop in cost per lead over the long term.
Keys to Success in Content Marketing
There are many factors that go into developing a successful content marketing strategy. Companies need to pay close attention to offering their customers relevant, engaging content that is both customer-centric and empathetic with the kind of challenges those customers are facing. Also, it’s critical to be consistently churning out fresh, new materials in order to keep your audience interested and craving more. Lastly, be patient. Content marketing may not produce immediate results, although your return on investment will be substantial over time.