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Measuring Unmeasurable Success
Return on investment has become a sort of Holy Grail in the world of marketing. In an era of seeming uncertainty and lightning-fast innovation, the capability of companies to measure their efforts based on ROI has become the most sought-after metric.
Sometimes, ROI works really well as a measurement of a marketing campaign or tactic. But a lot of what is done in marketing can't be traced directly to a sale unless there is a concerted effort to do so. It is these tactics we will focus on in this e-newsletter.
Branding, customer service, and proofreading are actionable items in the world of marketing that can't often be measured in sales. They're still important though, and they can be measured in ways beyond the flowing in and out of business. We hope you find this information useful.
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What is the ROI of Branding?
As we have discussed before, brand building consists of several elements, including a recognizable logo, a common aesthetic, a mission statement, and a reputation for teaching your audience valuable and relevant information. How do all of these aspects of brand building convert to an ROI measurement? Can there be an ROI for branding efforts?
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Is Customer Service Priceless?
The business world has reached a point of comfort when discussing the ROI of marketing opportunities. In some ways, measuring ROI in that context is somewhat easy. If a company adds to the number of customers, the campaign would be considered a success. If the number of paying customers does not increase, or if it goes down, serious questions would be raised about the marketing campaign. It's all about simple addition and subtraction.
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How Do You Measure What Isn't There? 
On October 15, 2010, The Black Keys, a soulful rock duo from Akron, got their MTV Video Music Awards statue in the mail. The band had finally won their first major recognition in the music industry. There was just one minor problem. The award itself named The Black Eyed Peas, not the Black Keys.
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Continuing Blogs from a Mad Man
Larry has opinions about taxes. Look out! Read his blog and voice your thoughts.
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What is the ROI of Branding?
As we have discussed before, brand building consists of several elements, including a recognizable logo, a common aesthetic, a mission statement, and a reputation for teaching your audience valuable and relevant information. How do all of these aspects of brand building convert to an ROI measurement? Can there be an ROI for branding efforts?
Every year, Interbrand Corporation compiles a ranking of the 100 most valuable global brands, which is then published by Business Week. One of the ways Interbrand ranks the value of all the different brands is by calculating what portion of a company's revenues can be credited directly to branding. Through a proprietary algorithm, the brands are then ranked by financial performance (ROI), role of brand, and brand strength. The report can be viewed here.
Unfortunately, this kind of research is not available to everybody. Indeed, many of the benefits a company receives from branding may seem intangible. As Albert Einstein once said, "Not everything that can be counted counts, and not everything that counts can be counted." So, if we suggest that good branding counts but can't be counted via ROI metrics, how can we wrap our arms around the importance of a company's brand? Consider the following.
The Immeasurable Value of Being There: How can a brand even be considered if no one knows about it? It's difficult to assign a value to simply existing as a known entity in an industry. Possessing a recognized brand doesn't necessarily translate to sales, but it gives a company a better chance. What possibilities are lost if your brand is an unknown factor?
A Sturdy Foundation: If you or your company has ever tried to approach a new industry with a new product, you know the challenge that entails. When your brand is a known entity, people may be more willing to test out that product. You have established a history of credibility. If your brand is an unknown factor, what motivation would potential customers have to test your product, especially if there are other brands that are better known?
Answering Your Competitors: Your competition is telling a story to your industry. If you are not aggressively building your brand, that story could well go unchallenged. What is the value of adding your company's capabilities to that story? What is the value of offering an option to potential customers? It may not be measurable via traditional metrics, but it still counts.
Can ROI measure the success of a brand building campaign? It's possible, but not always feasible. In the absence of measurable benchmarks, however, branding still remains a key factor in any marketing campaign. Are you building your brand? Let us know if we can help.
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Is Customer Service Priceless?
The business world has reached a point of comfort when discussing the ROI of marketing opportunities. In some ways, measuring ROI in that context is somewhat easy. If a company adds to the number of customers, the campaign would be considered a success. If the number of paying customers does not increase, or if it goes down, serious questions would be raised about the marketing campaign. It's all about simple addition and subtraction.
In the case of customer service, however, ROI is not so simple. As the name indicates, customer service is often a function of assisting people who are already customers. They may have already purchased your product or service. How then can we measure the ROI of customer service?
To answer this question, let's first look at what kinds of scenarios require a customer service representative or department.
- A customer is having problems with something they have purchased from you
- A customer wants to add to or subtract from their current relationship with you/your company
- A prospect, not yet a customer, wants to learn more about your company
How can you measure the ROI in each of these three scenarios? We have some ideas.
A customer has complaints about your product or service: One of the hot topics in the Social Media realm this year has been that complaints or "bad buzz" are actually beneficial. Complaints give your company an opportunity to respond and make things better. It is the great silent masses who leave your company's fold without explanation that are truly dangerous. Even so, how can we measure the ROI for solving someone's problem or for making a dissatisfied customer a raving fan?
The best way is to make sure you have ways to monitor your customer service work in tandem with your sales information. Can you track a person who contacts customer service to see if they return later to purchase more? Can you track if a person returns the product or asks for a refund even after talking with a customer service representative? These measurements are also simple addition and subtraction. Is your customer service department "saving" sales?
A customer wants to add or to subtract from their current relationship with you: If a customer wants to add to their relationship with you, it would seem like measurement is not necessary. In this case, however, you need to ask yourself what you invested to create that return. On the flip side, if an existing customer wants to end his or her relationship with you, or if they want to reduce their involvement with you or your company, it is essential that you find out how they got to that point. Did your customer service department fail that person? Did your sales or marketing team present information that did not match the actual product or service?
A prospect, not yet a customer, wants to learn more about your company: This is where the ROI of customer service can really be measured if you have your eyes and ears open to the challenge. The thing is, your website can serve as the customer service department in this scenario, supplementing your customer service representatives and your sales force. Actions need to be recorded, as do results, when leads are converted to sales. A website can help you or your company track how a person found out about your company. What was that path he or she took to learn more about you? Did that path work or did he or she try several different things before finally purchasing? A kind word, good information, or an easy-to-find call to action can make the ROI of customer service very real and very trackable, but organization and an infrastructure for tracking must be in place.
The fact is that while customer service may seem impossible to measure, it is one of the most important things a company can and should measure. A good customer service experience can turn a prospect into a brand evangelizer. A poor experience or a disorganized website can turn a prospect into a raving fan of your competitor. What is the loss of investment for a company when a potential customer ends up with the competition instead?
Customer service represents, at times, a major investment for a company. It's time. It's personnel. However, the true ROI of good customer service can be priceless. Are you measuring your customer service efforts?
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How Do You Measure What Isn't There?
Lately, it seems like proofreading mistakes are everywhere. In our local newspaper, there are not only misspellings, which are really inexcusable with the advent of automated spell check (yes, there's an app for that), but there is also a regular dose of misinformation.
We know the cost of big mistakes. We know that errors make us look sloppy, disorganized, less dedicated, and more. But is there an ROI for not making mistakes? Is there a way to measure sales based on how typo-free our work may be?
Truthfully, measuring the value of proofreading may depend more upon analyzing what opportunities proofreading errors cause a company to miss. The following two examples illustrate how a lack of simple fact-checking and proofreading prevented companies from receiving a positive return on investment.
Fast Food, Fast Typing: Restaurants are trying more and more consistently to use Social Media to increase sales. This was clearly the reason why Dennys invited people to converse with them on Twitter. All of the Dennys menus told customers that the conversation could be continued on Twitter by tweeting to @Dennys. There was a problem, though. If you tweet to @Dennys on Twitter, you are actually talking to a man named Dennys Hsieh, a fellow from Taiwan. We're not sure if he has a lot to say about the Grand Slam breakfast.
It can make you go bananas: Mark Brownlow, author for email-marketing-reports.com, recounted last year a story from when he was a young man working in a cardboard box factory. The company ordered 200,000 boxes, all of which were labeled "Premium bannanas." Clearly, a spelling error like that would be subtracted from any potential ROI for creation of the boxes, and the shame is that the error was so avoidable.
Brian Clark, the brains behind Copyblogger.com, wrote a post earlier this year called Five Grammatical Errors That Make You Look Dumb. The post has received 764 comments. Clearly, the issue of proofreading, including good spelling and grammar, is an important one.
Even with all of this in mind, it's perhaps unclear how we can measure the ROI of good proofreading. Perhaps the better question to ask in this case is whether you can afford the absence of proofreading. If you send out materials that make you or your company look sloppy or unpolished, what would that cost you? What would that cost you in terms of respect and trust from your customers? You may not be able to measure the ROI of good proofreading, but you can probably imagine the costs of serious gaffes. Is it worth the risk?
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Sincerely,
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