Understanding ROI in 6 Steps – Communicators Conference 2011

Last Wednesday (I know this is beginning to be less timely) I attended the PRSA Communicators Conference at the Governor Hotel. The conference was filled with great PR pros to talk to, listen to and learn from. My personal favorite speaker was Katie Delahaye Paine on the dreaded word that we all know but don’t know how to get – ROI.

Other than the fact that she was interesting and fun to listen to, the information and tips she gave the conference was amazing. Delahaye Paine broke finding ROI into six steps:

1. Define R in ROI: You must know what kind of return you are looking for. If you are a small nonprofit looking to feed 55 homeless and you need volunteers and donations, you don’t need 60,000 “likes” on your Facebook page. Instead, you want to get the 150 right people. So, your return shouldn’t be increase Facebook “likes” to 60,000, but to contact the correct 150 people that will actually be able and willing to help out your cause.
2. Define the I in ROI: Before creating a campaign pre-planning must take place. This means you know how much money, time and and everything else you will need to make the campaign successful. The logistical value of what goes into making a campaign decides your “I” of ROI. Whether it is a $3 million, 65 hour campaign that uses all of your assets and the whole company’s well-being is on the line, or it’s a much less aggressive campaign, you need to know how much you are investing in the project.
3. Establish benchmarks: Setting benchmarks are key to keeping on track in a campaign. Without benchmarks you could easily fall short and you wouldn’t know until the end. Benchmarks allow you to adjust during the campaign to create the best possible outcome.
4. Define your metrics: This to me is the hardest point. There are countless articles talking about what are good metrics and bad metrics, and now we have the Barcelona Principle that goes even further to help find real, usable beneficial metrics. For example, impression counts don’t mean there are actual eye balls reading your ad, it only means that the page with the ad on it was opened that many times. Delahaye Paine had a chart on her slides that showed the different levels of engagement from the worst to the best. It goes something like this: Impressions are the worst, repeat visitors, followers, comments etc., then retweets and shares, registration on a site, and finally trial purchases. Shoot for the trial purchase side of the spectrum to measure quality engagement with the consumers.
5. Pick a tool: How are you going to measure the success of the campaign? Delahaye Paine suggested a “kick butt index” (KBI). She suggests that you have a scale from negative ten to positive ten, and if a comment or retweet was positive it goes on the positive side and the opposite if there is a negative comment. In the end you add up the score of everything that happened and you crunch the numbers. If the result is positive, the campaign’s a success, if it’s negative then it’s back to the drawing board.
6. Find the result, change and measure again: This is the most crucial part of any campaign because at this point you have done the experiment and now you can measure the results, and change your tactic for the next time. This last step ensures that the next campaign will be better than the last because you have done the research, seen what happened and can change the result.

I hope this helps, and if you have any comments, ideas, or rants please feel free to comment.