Let’s face it:
You already know how effective content marketing can be.
You know that website conversions are 6x higher for content marketer adopters than non-adopters.
You know that marketers who rate themselves as effective at content marketing allocate an average of 37% of their marketing budget to content marketing.
Your problem isn’t finding more statistics or case studies…
Your problem is that you can’t explain the ROI of content marketing in a way that pushes clients and superiors towards pulling the trigger and putting more money into content strategy.
And it’s a problem that just about everyone in this industry faces.
The purpose of this guide is to help you solve that problem.
Let’s dive in.
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Explaining the ROI of Content Strategy Through Numbers Everyone Understands
Most clients and executives make decisions on what marketing strategies to pursue based on what that strategy can do for them.
They’re not particularly interested in hearing about the potential of the strategy or seeing case studies for other brands.
Clients and execs want to know, plain and simply:
“How will this strategy help THIS business make more money?”
The easiest way to answer that question is by speaking in terms they immediately understand.
For most, that means speaking in dollar signs and ROI.
The Content Marketing Trifecta: Earned Traffic = High Quality Leads = Sales
In its simplest form, the goal of content marketing is to drive targeted traffic to a website and convert that traffic to high quality leads.
From there, the goal is to convert those leads to sales.
The concept is obviously much more complex than that, but our goal here is to simplify this into dollar signs.
According to Marketing Sherpa, the average conversion rate for organic traffic to leads is 16%.
Knowing this, we can set 16% as our standard conversion rate for converting organic traffic to leads.
While it’s much more difficult to come up with a consistent conversion rate for leads to sales, as it varies wildly by industry, the one thing we do know is that SEO leads convert at a MUCH higher rate than outbound leads (ex. paid advertising).
In fact, some studies have shown that SEO generated leads have a close rate of 14% while outbound leads have an average close rate of only around 2%.
So now we have two numbers to use as benchmarks:
- Organic Traffic to Leads = 16%
- Leads to Sales = 14%
The Content Marketing Trifecta Equation
All we need to do at this point is plug our benchmark conversion rates into a formula alongside our monthly traffic numbers.
Our equation should look like this:
Monthly Visitors x 16% Organic Traffic to Lead Conversion Rate = X Leads/Month
X Leads/Month x 14% Lead to Sale Conversion Rate = X Sales/Month
So, in a hypothetical situation, let’s say our website generates 1,000 visitors per month.
1,000 Visitors x 16% = 160 Leads/Month
160 Leads x 14% = 22.4 Sales/Month
So, with 1,000 monthly visitors and average conversion rates, we should expect 160 leads and 22.4 sales per month.
Judging the Content Marketing Trifecta Equation Against Real Numbers: Case Study
To illustrate how closely this hypothetical situation, and the equation associated with it, play out for a real business, let’s take a look at a quick case study of my agency (Express Writers).
In January 2018, our traffic numbers were 15,470 visitors/month.
I should note that, for this particular month, around 30% of our traffic came from a single ongoing viral blog that is not intended to drive targeted leads.
So, if we take that particular blog and the associated traffic out of the equation, our monthly traffic is now 15,470.
If our equation is correct, our leads and sales for the month should look like this:
15,470 Monthly Visitors x 16% = 2,475 Leads
2,475 Leads x 14% = 346 Sales
As of 3:00 PM on January 30th, our actual order total for the month was 314 (an average of 10.5 orders per day).
If that average played out for the last day of the month, we’d end up with 325 total orders for the month.
As you can see, our expected order amount based on the content marketing trifecta equation and the actual order amount are almost identical.
Expected = 346 Orders
Actual = 325 Orders
And while we did come up 21 orders short of the expected total, we should note that our average order size for this particular month was over $330/order.
3 Steps to Explain the ROI of Content Strategy to Clients and Superiors
The goal here is to explain the ROI of content strategy in a way that pushes clients and superiors towards investing more money in content strategy.
To do that, we want to break this down into terms they immediately understand…dollar signs.
Step 1: Explain the Evergreen Effects of Content Strategy Over Paid Advertising
Let’s go back to our organic traffic analysis from SEMRush for January 2018 traffic.
Via Google Adwords to achieve similar monthly traffic numbers, if we didn’t have a comprehensive content strategy in place, we’d have to pay $45,400 per month to achieve monthly organic traffic of 22,100 visitors.
To reach that traffic number on a monthly basis, we’d have to spend over $500,000 per year on Google Adwords.
And while it took 5 years of creating great content and refining our strategy to get here, the evergreen effect of having 20,000+ visitors per month coming to your website for minimal marketing dollars is priceless.
Step 2: Explain the Costs & ROI
To make this simple, let’s say that your goal is to publish one 1500-word piece of authority content per week.
If you were to outsource this content to an agency like Express Writers, the costs would look like this:
52 Weeks x $375 = $19,500 Per Year
Since the authority content is focused on low competition, high volume keywords, let’s make the safe assumption that by the end of the year we’re able to reach at least 3rd in Google ranking for two-thirds of those keywords.
Let’s also assume that the keywords we targeted had search volume of at least 1,500 searches per month.
Now let’s look at the expected traffic number based on our assumed 3rd place ranking in Google.
Image SourceTo break down the numbers:
Keywords Ranking in 3rd Position (⅔ of our 52 posts for the year) = 34
Monthly Search Volume Per Keyword = 1,500
Click-Thru Rate for 3rd Position in Google = 13.14%
Now, we just need to take a look at the total search volume for all the keywords and use our click-thru rate benchmark to determine how much of that monthly traffic we’ll receive:
34 Keywords x 1,500 Monthly Search Volume = 51,000
51,000 Total Monthly Search Volume x 13.14% Click-Thru Rate = 6,701 Visitors Per Month
So, in this scenario, we’ve spent $375 per month, or $19,500 per year, on high quality content to reach 6,701 monthly visitors.
The monthly cost of that number of visitors had we used paid advertising to drive traffic? $17,000.
In this hypothetical situation, our one year investment in authority content is 10x cheaper than if we used paid advertising to achieve that same monthly visitor count.
And, if we plug in these numbers into our content marketing trifecta equation, we can even determine the sales that our monthly traffic will yield:
6,701 Monthly Visitors x 16% Organic Traffic to Lead Conversion Rate = 1,072 Leads/Month
1,072 Leads/Month x 14% Lead to Sale Conversion Rate = 150 Sales/Month
Step 3: Show Them the Money
Armed with the numbers presented above, your job now is to simply show your clients and superiors the revenue potential.
To do it, figure out the average order size and multiply that by the number of sales per month.
Even if our average order size is a modest $100, our increase in sales from our content would look like this:
$100 Average Order Size x 150 Sales/Month = $15,000 Revenue/Month
So, using the realistic numbers outlined above, we spent $19,500 for the year to increase our revenue by $180,000.
That’s an ROI of over 900%.
Use Real Numbers to Convince
Explaining the ROI of content strategy doesn’t have to be a tooth-pulling experience.
If we’re able to use the equation and benchmark numbers above, we can have a conversation around content strategy that focuses on what matters to your client and superiors…dollar signs.
That’s pretty darn effective.
Hopefully this guide can help jumpstart your next conversation and get the content marketing investment ball rolling faster than ever.