Download - True ROI Measurement in Google Analytics

True AdWords ROI Measurement For E-Commerce Websites

Jeff Sauer | @jeffaly.cs | #measurecamp| True AdWords ROI Repor.ng

Your Guide

2

Jeff Sauer Marketer and Entrepreneur Jeffaly.cs and Knowledge Land Minneapolis, MN, USA google.com/+JeffSauer knowledge.land

Do You Have TBAGD?


What is TBAGD?

Tool Blindness


What is TBAGD?

Tool Blindness

Google Dependency


What is Tool Blindness?

Photo Credit: mirror.co.uk


What is Google Dependency?

Let’s Talk About ROI


ROI Does Not Stand For:

•  Regal or Idiot •  Roided Out Imbecile •  Randy ‘Ol Ins.gator •  Rager on Ibiza

Return on Investment


Return On Investment

How Much Money Did We Spend?

Investment


Return On Investment

How Much Money Did We Spend?

How Much Money Did We Make?

Investment Return

Yet We Send Reports Like

This


ROI According to Google Analytics


And We Think To Ourselves


But Executives Think of Us Like This

It’s Not Your Fault


You Simply Have a Case of TBAGD

Tool Blindness

Google Dependency

Time to Evolve


Evolution of Man

Photo Credit: wallpapersus.com


Since We’re an Un-Conference


Let’s Remove the Google Goggles

Let’s Remove the Beer Goggles

Sidebar: Google Image

Search for Ugly to Pretty


Ugly to Pretty = Goldmine

ROI in Google Analytics


This is ROI in a Vacuum


ROI by Very Definition, That’s All

By Defini.on, This is Return on Investment


Investment and Revenue Are Important

Investment


But… We Forgot About Profit

We Forgot About Dre Profit


We’re Still Far From Supermodels

Finding Your True ROI


How ROI Should Really Be Calculated

Revenue


Subtract Our Ad Spend

Revenue

Adver.sing Investment


Subtract Cost of Selling Each Product

Revenue


Product Cost


Subtract Fixed Costs of Business

Revenue


Product Cost

Fixed Costs


Now You Have Net Profit

Revenue


Product Cost

Fixed Costs

Net Profit


Here’s an ROI Equation to Use

Gain From Investment (Net Profit)

Cost of Investment

Cost of Investment

ROI


Pulling It All Together

Revenue $82,730 100%



Revenue $82,730 100% Ad Spend $10,942 -‐



Revenue $82,730 100% Ad Spend $10,942 -‐ Return on Ad Spend $71,788 656%

AKA ROI in AdWords



Revenue $82,730 100% Ad Spend $10,942 -‐ Return on Ad Spend $71,788 656% Cost of Goods Sold $62,021 75%



Revenue $82,730 100% Ad Spend $10,942 -‐ Return on Ad Spend $71,788 656% Cost of Goods Sold $62,021 75% Gross Revenue $9,767 12%



Revenue $82,730 100% Ad Spend $10,942 -‐ Return on Ad Spend $71,788 656% Cost of Goods Sold $62,021 75% Gross Revenue $9,767 12% Total Fixed Costs $5,000 6%



Revenue $82,730 100% Ad Spend $10,942 -‐ Return on Ad Spend $71,788 656% Cost of Goods Sold $62,021 75% Gross Revenue $9,767 12% Total Fixed Costs $5,000 6% Net Profit $4,767 6%



Revenue $82,730 100% Ad Spend $10,942 -‐ Return on Ad Spend $71,788 656% Cost of Goods Sold $62,021 75% Gross Revenue $9,767 12% Total Fixed Costs $5,000 6% Net Profit $4,767 6% True ROI 44%


We’re Getting Closer

Incorporating Lifetime Value


Future Purchases = No Ad Spend?

Assume No Future Spend


Future Purchases = No Ad Spend?

Assume No Future Spend

AND

Customer Has 1.5 Life.me Purchases


We Find the True ROI of our Efforts

Revenue $124,095 100% Ad Spend $10,942 -‐

Return on Ad Spend $113,153 1034%

Cost of Goods Sold $93,031 75% Gross Revenue $20,122 16%

Total Fixed Costs $5,000 6% Net Profit $15,122 18% True ROI 138%


We Have Cured Measure Blindness!

Thank You, Old Chap!

Source: hkps://answers.yahoo.com/ques.on/index?qid=20080201184249AAHqd5l


Jeff Sauer Marketer and Entrepreneur Jeffaly.cs and Knowledge Land Minneapolis, MN, USA google.com/+JeffSauer knowledge.land

Thank You!

57

Download - True ROI Measurement in Google Analytics

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