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How to Explain the Value of Your Marketing Efforts: ROI Made Simple

posted by Michael Epps Utley Michael Epps Utley
Dodgeball seo roi explained

Do you need buy-in and ongoing support for your marketing programs from company leaders, bean counters, and number crunchers?

It’s a common practice in many firms. Managers and analysts must be convinced that the investment they make in marketing pays off in sales and revenue.

Explaining the return on investment (ROI) of marketing to bosses and other stakeholders isn’t easy for most marketers to do. In many cases, if you can’t convey ROI, you may never be able to get a project off the ground. Most leaders won’t approve anything unless they’re convinced it will succeed.

So, how can you explain marketing and its ROI, ensuring people “get it.”

Don’t worry. I’ve got your metrics back!

Explain Marketing, Strategy, and Metrics in Ways Your Audience Will Understand

You avoid jargon in your marketing content. Shouldn’t you also do so when talking about marketing?

Avoid terms people you’re speaking to won’t understand. Or explain them early in your presentations. You get bonus points if you provide the people you’re talking to with a glossary “cheat sheet” of hard-to-understand terms they can refer to during your meetings.

Start with the basics in your explanation of marketing and strategy. Metaphors and stories are a great way to bring challenging concepts to life. You simply convey what you’re explaining by comparing it to something people already know. For example, if your boss is a football fan, use stories and illustrations to explain how your marketing strategies will move your sales efforts “down the field” and result in sales “touchdowns”. Include a rule book that describes how you’ll track progress toward your “wins.”

After you present your overall strategy in terms your stakeholders understand, it’s time to go deep and provide details.

Maximize Your Metrics Messaging

Even the best metaphors and stories aren’t enough to explain your marketing and its value to get buy-in. Here are two other tactics you can use to demonstrate how marketing works, make stakeholders care about it, and prove that it gets results.

1. Provide Evidence

No one should simply take your word that a marketing program will drive sales for your organization.

You have to prove it!

In other words, show people the proof, and don’t talk about the potential.

Pull together examples of other businesses that have used the marketing strategies and tactics you’re recommending to achieve the results you want to earn. Case studies are relatively easy to find online, and most include enough data to convince even the toughest number cruncher that you’re trying to bring over to your side.

2. Explain What’s in It for Them

Always emphasize what each of your stakeholders will gain from your marketing programs.

  • If you’re talking to salespeople, highlight the sales your marketing campaign will generate for them.

  • If you are speaking with budgeters, emphasize the efficiency of the effort.

  • When you meet with senior leaders, draw their attention to the revenue your marketing strategies and tactics will drive to the business's bottom line or how they will pay off for shareholders.

Think about the people you want to support you and develop your message for them. It’s no different than tailoring the writing in your marketing campaigns to the people in your target audience.

Estimate the ROI on Implementing or Continuing Marketing Programs

It’s time to put numbers behind your promises.

Conversions are the metrics that matter when determining the success of a marketing strategy. Some common types of conversions are:

  • Attracting or increasing traffic to a website.

  • Converting web traffic into quality leads.

  • Converting leads into sales.

If you can quantify conversions in terms of their potential sales value, you can estimate the eventual ROI from investing in a marketing strategy.


Benchmark numbers can help you estimate conversions. Two key benchmarks you will definitely want to use:

  • Your industry’s average conversion rate to high-quality leads (the ones most likely to become customers)

  • Your company’s average rate of high-quality leads that convert to sales.

Use these numbers, plus your company’s monthly traffic figures and average value per sale, to predict marketing ROI in the form of projected leads and sales.


Use this formula to estimate leads per month:

Number of monthly visitors X average traffic-to-leads conversion rate = number of leads per month.

Use this formula to estimate the sales per month from those leads:

Number of estimated monthly leads X average lead-to-sale conversion rate = number of sales per month.

Take things to the ultimate level: Multiply your company’s average sale amount value by the average sales per month to get a monthly monetary ROI estimate.

Make the Numbers Work for You

Showing the ROI potential of a marketing program is great. However, it’s not as powerful as demonstrating why your proposed campaign is better than other types of marketing investments.

Here’s how to do just that.

Estimate the Investment

Upfront cash is required for launching a marketing effort. It’s time to show how you will use that cash and what it will generate in return.

Here is a straightforward example:

  • You plan to spend $1,000 per month on a marketing campaign for a total of $12,000 per year.

  • You expect it to attract 1,000 website visitors at $1.00 per visitor.

  • One-third of those visitors will become leads at $3.00 for each of those 333 leads.

  • One out of four of those leads will become customers at approximately $12.00 for each of those 83 customers.

  • The average sale to a new customer at your company, not taking into account repeat business, is $300.

  • A monthly investment of $1,000 in your marketing program would result in $24,900 in new business.

  • The $12,000 annual investment in your marketing program will result in almost $300,000 in new sales over the year.

That kind of analysis should undoubtedly sell your program to your stakeholders.

Compare and Contrast

Now, let’s make your case even more convincing.

  • A rival marketer wants to spend that same $1,000 per month on THEIR marketing effort for a total of $12,000 for the year.

  • They expect it to attract 500 website visitors at a cost of $2.00 per visitor.

  • One-third of those visitors will become leads at a cost of approximately $6.00 for each of those 166 leads.

  • One out of four of those leads will become customers at a cost of approximately $24.00 for each of those 42 customers.

  • The average sale to a new customer at your company, not taking into account repeat business, is $300.

  • In the end, a monthly investment of $1,000 in your rival’s marketing program would result in $7,200 in new business.

  • Your rival’s $12,000 annual investment in their marketing program will result in just over $86,000 in new sales over a year.

The other marketer’s program ROI is good, but yours is better. It’s far more likely your effort will get funded than theirs.

Don’t Stop There!

Once you get your investment for your marketing, make sure you report back to your stakeholders on the return they’re earning on it. Provide regular updates (in a language they will understand) on the results your program is generating. Keep reporting even if results are underperforming expectations. It will allow you to work with stakeholders to course-correct and make things right.

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