So you’ve invested in video for your business, spent a significant amount of time and money getting it right, and you’ve got a plan to get it out to the world.
Simply creating and distributing your videos won’t automatically result in new clients rolling in, or prospects engaging with your brand overnight. As marketers know by now, promoting your brand with content of any kind – including video – can take a while before you start to see results.
And what do these results refer to? How much value are you getting back from what you’ve put into creating the video, and how much does that value stand against your marketing budget?
Calculating your video return on investment, or ROI – much like any other marketing campaign – needs to be carefully thought out and planned. After all, you don’t want to make any video marketing mistakes!
So, to understand your video reach and maximise your video budget, you need to continually monitor, test and measure to know what it’s giving back to you.
Here’s our quick guide to calculating your video’s ROI:
Step 1. Set goals
You’ve probably heard this before, but without goals, you can’t accurately measure the performance of any of your marketing campaigns, simply because you don’t know what it’s trying to achieve.
Yes, it’s pretty, but has it lead to any sales? Has it sparked an increase your website traffic?
You need to have clear indicators that will tell you whether your video has been successful, in short, the goals you set will determine the metrics you’ll be looking at in order to assess ROI.
Step 2. Understand your budget
After you’ve created your video(s), it’s important to work out the total costs involved to produce it. This will then help you calculate the number of sales you’ll need to make from the video to break even.
Step 3. Choose your distribution channel(s)
It’s important to think about where your video will be hosted and and how it will be distributed. Consider your target audience, where they’re likely to spend time and think about the length of your video. From this, you’ll be able to work out the best distribution channels for your video (and what metrics you’ll track on the channels)
For example, a video that features on your website needs to be aimed at your existing audience. It needs to be informative, engaging and aimed at keeping viewers on your page longer. Whereas social videos will be used to grow and connect with your audience and build awareness. These videos need to be short and engaging.
Step 4. Know your tools
To calculate your video ROI you need to be familiar with the tools that are available, their capabilities and the costs involved.
There lots of tools that help you measure video ROI. To name a few:
- YouTube analytics – free service
- Vimeo Analytics – free service, with paid plans available, ranging from $0 to $220 per year
- Google Analytics – free service
- Wistia – free to paid plans, ranging from $0 to $100 per month
If you choose to go with a paid plan, make sure you factor these costs into your budget.
Step 5. Understand your metrics
Measuring engagement takes into account the combinations of:
- Reach: number of people your video was presented to
- Views: number of views of your video
- Actions taken: number of comments, likes and shares
- Watch time: length of viewing time
Most analytics tools (even Facebook’s Insights tool) will give you access to these figures, so they’re easy to keep an eye on.
6. Track leads and sales
There are a couple of simple ways you can keep track of the leads and sales coming in from your video(s):
- Track links through UTM parameters
UTM parameters are tags added to the end of a URL that communicate with Google Analytics and help track custom campaigns. Make sure the link people follow from your video (or CTA) to your landing page includes a tag for a simple way to measure lead generation.
- Split Test Landing Pages
You can compare sales landing pages with video to those without. See which ones are performing better and how you could improve them. Keep testing!
Third party services like Wistia offer more in-depth analysis that show CTA completions, rewatches, email submissions and the even more with API integrations with your marketing automation tool. They come at a cost, so make sure they can fit in your budget!
Working on your company’s video strategy? Download our guide to help you maximise your video budget and see results that will make a huge difference to your business.