DELUXE MARKETING SERVICES

ALL ROADS LEAD TO ROMI

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Does your financial institution still view marketing as a “cost,” rather than an

investment? The question goes far beyond mere semantics. The cost of your

marketing campaigns is only part of the equation when you’re calculating the

value of your marketing efforts. Approach marketing costs as an investment,

and the other part of the equation – returns – comes into clearer focus.

It’s vital for marketers to demonstrate value in terms of return on marketing

investment (ROMI) in order to keep internal decision-makers engaged in, and

supportive of, marketing initiatives. Successful marketers know all roads lead

to ROMI.

The Distinction Between ROMI and ROI

Return on investment is a useful barometer for tallying the value and success

of a range of business targets, from sales to product development. For those

targets, it’s a straightforward calculation: profit (or revenue) divided by cost

equals ROI.

But is it the most useful tool for measuring the value of marketing initiatives?

Many marketers would argue that it is not, particularly in the financial

industry. Because the success of marketing campaigns rides on both tangible

and intangible factors, as well as short-term and long-term goals, calculating

the value of an initiative is a complex process. For this reason, it’s more

valuable to think in terms of ROMI, rather than ROI.

ROMI compares revenue gained against marketing investment. Some

marketers will also consider brand awareness in their ROMI metrics, and

digital marketers further spice up the mix by adding in dwell time – the

length of time customers spend interacting with a specific initiative. These

additives are all intended to help marketers better quantify intangibles such

as consumer engagement and brand loyalty.

Beyond Mere Justification

Some marketers view measuring ROMI as little more than justifying their

department’s existence to their financial institution’s decision-makers.

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ALL ROADS LEAD TO ROMI

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To be sure, it’s important to demonstrate results through ROMI metrics. But

the usefulness of measuring ROMI goes far beyond proving the value of your

marketing efforts.

One commonly quoted statistic from ROMI expert Gary R. Powell indicates

that by using data and analytics, marketers can boost revenue, profit, and

market share between 8% to 15%, without increasing marketing costs.

ROMI helps you differentiate what works and what doesn’t, so you can

channel resources into initiatives with the greatest potential for success and

impact.

Arriving at Your ROMI Destination

Now that you understand the importance of ROMI, how do you get there?

Define what you are measuring. It’s important to define what you’re measuring and why. Establishing

goals allows you to better estimate ROI at the outset of a campaign.

Financial marketers surveyed by The Financial Brand say their top

metrics include deposit and/or loan volume, customer growth, depth

of relationship, share of wallet, market share and customer retention.

Whatever your benchmarks, it’s important to structure marketing

initiatives to facilitate measurement.

Build measurement into objectives and strategies. As you planning your objectives and formulating strategies, identify

opportunities for measurement. Whenever possible, build in tangibles

that can be more readily measured and that will underscore the overall

big-picture success of intangibles. Establish a reporting schedule

that allows you to keep your successes top-of-mind for organization

decision-makers and affords you the most up-to-date information

when you evolve your strategies to address fluctuating market

challenges and opportunities.

View every ROMI result as valuable. Even if it falls short of your goal, a less-than-stellar showing can help

you identify a campaign that needs tweaking or replacing. A post-

mortem on a failed campaign can help you make decisions toward

initiatives that will have greater success.

Remember, your ultimate goal when measuring ROMI is not to prove the

value of your marketing initiatives, but to constantly improve it.

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