I’ll let you in on a little secret: you’ll never be able to calculate content marketing ROI in its entirety.
And that’s okay. It shouldn’t stop you from modeling ROI during planning nor from calculating ROI in retrospect.
Content marketing is expansive:
- It flows through the pirate metrics: acquisition, activation, retention, referral, and revenue.
- It cuts across different channels: social media, SEO, YouTube, forums, communities, sales enablement, and more.
- It’s also dependent on the limitations of the attribution model you choose. There are many of them, all with tradeoffs.
Still, as a responsible marketing leader, you should want to know if the dollars you’re putting into an investment are actually returning business value.
That will be the point of this article: to teach you the best way(s) to measure content marketing ROI, despite the above limitations.
Why Measure Content Marketing ROI?
“Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” – John Wanamaker
There’s a new refrain in Marketing World: not everything should be measured.
I agree, to a certain extent. Like the John Wanamaker quote above suggests, some percentage of your advertising dollars will be wasted – no matter what. And it’s very difficult to understand which percentage is wasted.
As I’ll suggest later, some of the most impactful advertising dollars you’ll spend will *appear* to be wasted.
But some things should be measured, including content marketing.
Despite all of the limitations above, measuring content marketing ROI and mapping out content marketing metrics is important for one big reason: to prove to your boss or client that it’s worth investing in.
Compare the two arguments:
“We can’t measure content marketing ROI! Not everything can or should be measured. Content marketing has tons of benefits we can’t measure.”
“There are many unmeasurable benefits to content marketing; however, look at these numbers. We’re actually driving pipeline with our efforts.”
Which of the two of these arguments are going to compel your boss to give you more budget?
Thing is, content marketing is a long game, and if you want to win, you need enough trust and runway to build the foundations to create compounding results.
However, I’m not so cynical as to think the only reason to measure something is political.
Measuring content marketing ROI on both a program level and granular basis also helps you make better decisions. It’s why we build organic traffic growth models.
As a marketing leader, I want to know where best to appropriately spend my limited time and marketing budget. If I don’t know the ROI of your team or channel, I’m relegating you to the “experimental” bucket, which is usually like 5-10% of efforts. Not a good place to be in.
I’m not even saying you have to measure content marketing ROI down to the sales or leads level. You just have to have SOMETHING to show for the time and money you’re spending.
If you don’t have a goal, it’s tough to craft a novel content strategy to achieve that goal. If you don’t have a content strategy, you’re just throwing tactics at the wall and seeing what sticks.
Plus, as a content marketing leader, you should also want to know which blog posts, videos, Tweets, and ebooks are working so you can better plan for the future as well as optimize old content.
How to Measure Content Marketing ROI
Measuring content marketing ROI will of course depend on many factors, including how attributable your purchase is (it’s easier with direct ecommerce than long sales cycles in B2B for example) as well as the typical buying window and other marketing initiatives you have.
But let’s keep things relatively simple (and therefore actually useful).
Here’s the six step process to measuring return on investment:
- Analyze the costs of your content marketing program
- Audit your content marketing analytics tools
- Determine your KPIs
- Determine your attribution model
- Calculate a proximate conversion value
- Calculate return on investment (if you really wanna)
1. Analyze the costs of your content marketing program
To calculate ROI, you need to first know how much you’re spending. This is deceptively difficult to do for two reasons:
Content marketing efforts are often diffused throughout an organization. There isn’t usually one “content marketing budget.” Rather, it’s absorbed into other budgets like PR, demand gen, product marketing, and even the general marketing budget.
You need to account for both direct and indirect costs.
Direct costs are easy enough to calculate. They’re the money you’re spending on things like freelancers, agencies, and software.
But what about indirect costs?
These can include the time your employees are spending on content marketing activities and the opportunity cost of not doing other things.
A piece of content can also be “costly” if it is produced by someone with many years of experience. As Whitney Wolfe Herd said on Tim Ferriss’ podcast, “The most expensive currency in the world is experience.”
There’s low risk in most content marketing, but there’s not zero risk.
You have to put a price on the cost of incurring damage to your reputation as well, especially if you’re doing contrarian stuff. Think about Brian Armstrong’s stance in his piece, “Coinbase is a mission focused company.”
My M.O. here is to avoid getting lost in analysis paralysis, and instead just add up the direct costs associated with content marketing – salaries, freelance and contractor budgets, and software + any advertising and promotions budget.
Hypothetical Content Marketing Cost Analyses
Let’s do two case examples: Situation A and Situation B.
Let’s say, for example that you have a team structure like this (Situation A):
- VP marketing (1/10 time on content) $250k
- Director of content $150k
- Content marketing manager $80k
- 2 content writers $60k
- 1 designer (¼ time on content) $20k
- SEO manager (¼ time on content) $25k
This adds up to be roughly $600k per year, or $50k a month.
Now assume you also pay for Ahrefs, Clearscope, and HubSpot + a few productivity tools. Let’s say your software costs are about $5k a month.
You also spend $5k a month on freelancers. This brings you up to $60k per month.
You better be producing a lot of high intent content to make up for that cost structure!
For Situation B, you keep things a lot more lean. Here’s your team structure:
- Head of marketing $200k
- Content marketing manager $90k
- Designer (¼ time on content) $20k
You’ve spending about $310k per year, so let’s say about $28k per month.
You work with an agency to produce 8 pieces of content per month and spend $16k on the agency. They have all the search engine optimization tools, so you just pay for HubSpot or some sort of CMS / marketing automation. This racks up about $2k per month.
So now you’re looking at $46k per month.
Once you have a handle on how much you’re spending, you can start to look at how to best allocate those resources.
2. Audit your content marketing analytics tools
What you want to do here is twofold:
Determine if you need additional analytics tooling
Determine if you’ve got your existing tools set up properly
The answer to #1 is almost always no if you have something like Google Analytics and a CRM / shopping cart. The answer to #2 is almost always no – I’ve rarely seen a perfect analytics setup.
There are a lot of different content marketing analytics tools out there, so it’s important to choose the ones that are best for your needs.
Here are a few questions to ask when you’re evaluating content marketing analytics tools:
- How easy is the tool to use?
- Does the tool integrate with other tools you use?
- What kind of data does the tool collect?
- How accurate is the data?
- Does the tool have any limitations?
Almost everyone uses Google Analytics, and Google Analytics is customizable enough that you can probably get almost all of the data you need to calculate ROI.
However, if you’re working on B2B content marketing (especially at an enterprise SaaS company with a large sales motion), you may need to integrate your website analytics with your CRM.
This requires a little bit of data engineering, or at least data blending in a tool like Data Studio. How to do that is a bit outside the scope of this article.
At the very least, you should have Google Analytics set up with goals to measure discrete actions on your website that approximate value. Metrics like:
- Lead conversions
- Ecommerce purchases and revenue
- Email list signups
- Product signups
The other stuff – the leading indicators – are relatively easy. Google Analytics tracks channels and pageviews with zero custom setup. And you can easily invest in an SEO tool that helps you track search rankings.
Additionally, if you’re engaging in platforms outside your website or blog, such as social media platforms (Twitter, LinkedIn, Facebook), YouTube, podcasts, or forums (Quora, Reddit), then each of these platforms give you some cursory analytics.
There are usually analytics tools for each of these platforms as well (such as VidIQ for YouTube analytics).
An audit of your tools will help you uncover existing gaps and help you fill them. You don’t want to track EVERYTHING, but you want to track everything that matters and that is possible to track.
3. Determine your KPIs
The next step is to determine your KPIs.
Actually, you should have done that long before reading this guide or starting your content marketing efforts. But it never hurts to revisit your KPIs.
This will help you focus on the metrics that are most important to your organization and content marketing strategy.
Some common content marketing KPIs include:
- Engagement rates
- Social shares
- Time on page
- Pages per visit
- Email list signups
Most of these, without context, are terrible metrics, and should never be used as key performance indicators.
I’ve done tons and tons of correlational analyses on things like bounce rate, exit rate, and pages per visit, and I’ve found zero correlation with macro-conversions like demo requests, email list signups, or product purchases.
So my tip in establishing KPIs is to start with exclusion – what are you NOT going to care about? You can still track them, and they can still be useful in fulfilling a more colorful picture of user behavior. But they aren’t useful for driving business decisions.
I’d say ignore:
- Pageviews without context (you can generate a ton of irrelevant traffic that doesn’t reach your target audience if this is your core KPI)
- Social media shares (same thing, can incentive invective takes or sensationalist content)
- Bounce rate or exit rate
- Time on page
Rather, start with your business goals. I bet your business goal is to generate revenue, users, or purchases.
Then map backwards to a proximate conversion that you can measure on your website. In ecommerce, you can measure the purchase orders as well as the value of those orders. In PLG SaaS with a freemium or free trial motion, you can measure direct product signups or trials.
In the case of demo requests and enterprise software, you may have to split these up into multiple tiers of MQLs, the most valuable being something like a demo request. Then you can ladder up to things like “high quality leads” using a tool like Marketo or HubSpot to do the lead scoring.
Backing up even further, you can create leading indicators that are controllable from within your content team. For example, conversion from content, organic traffic, rankings, and email list signups.
In 80% of cases, what we end up using for KPIs are the following:
- Position tracking for targeted keywords
- Organic traffic
- Conversions from content
- Revenue from content
Once you’ve determined your KPIs, you can start to collect the data you need to calculate ROI.
4. Determine your attribution model
The next step is to determine your attribution model.
This will help you understand how different channels contribute to your overall content marketing success.
Let me first state my contrarian opinion: complex attribution modeling is almost always a waste of time.
This isn’t coming from the position of someone who doesn’t understand attribution models (though I think no one understands them fully). I’ve used all the major marketing attribution systems (HubSpot, Marketo, Salesforce, Bizible, etc.), and have played with every attribution model available in Google Analytic, including the data-driven algorithmic model. I’ve even built custom markov-chain based attribution models in R.
Almost all of it was a waste of time.
An attribution model, no matter which one you choose, will be inherently limited and will have tradeoffs. It’s only important that, organizationally, you pick one and use it to communicate with other teams and make better business decisions.
Anyway, there are a few different attribution models you can use, but the most common are first-touch and last-touch.
With first-touch attribution, credit is given to the first touchpoint that a user has with your content. This could be a blog post that they read, an email they received, or a social media post they saw.
With last-touch attribution, credit is given to the last touchpoint that a user has with your content before they convert. This is often the point at which they click through to your website or landing page.
You can even compare these models with the Model Comparison tool in Google Analytics.
Some argue first touch is the best model for content marketing. Some, like myself, prefer to use last touch (knowing that it’s going to underestimate the true value of my content).
There are other models available in Google Analytics, like time decay, linear, and position-based. All of them differ only in the weight they assign to any given touchpoint.
Here’s the thing: the buyer’s journey is messy. This is why processes like identity resolution exist.
No model is ever going to truly approximate the value of a channel or touchpoint. So pick one, and let the chips fall where they may, knowing that there’s some uncertainty and more upside than you’re probably tracking.
5. Calculate a proximate conversion value
The next step is to calculate a proximate conversion value.
This will help you understand the value of each content marketing conversion.
In ecommerce, this is easy enough: the value of a conversion is the value of a purchase order.
If you’re in B2B, this is a bit tougher. Essentially, you need to know your average customer lifetime value (or some approximation of that), and from there, the average value of a lead / trial / freemium user / demo request.
To do this, you need to map out your funnel. Essentially, build a growth model. You should know your:
- Average website conversion rate
- Average conversion from from lead to customer
- Average customer lifetime value.
You can get super nuanced here and do this by product, channel, section of the website, and more. But it doesn’t hurt to start with aggregates to get a rough picture of ROI.
We have a free template where you can enter all of these values.
I want to stress that you’ll likely never get a fully accurate proximate conversion value – this is a model, and all models are wrong (but some are useful).
You just want to know approximate values, like:
- 10,000 pageviews
- 500 product signups
- 50 paid customers
- Average monthly value is $199 per month
- Average retention is two years
- So average LTV is roughly $4776
So we can take our average LTV and divide it by the number of product signups generated. This gives us a conversion value of $9.55.
The value of modeling this out is huge.
Imagine that you also have an email list CTA, and you can approximate the value of an email list subscriber at $5. This is lower than the average value of a product signup, but you may be able to drive more email signups on a given blog post. If, on balance, you can drive more ROI with one or the other CTA, you can easily make that tradeoff.
It also lets you know which levers are the most impactful to pull. Sometimes it’s difficult to simply drive 2-5X more traffic, and rather, it would be easier to increase your trial to paid conversion rate by 10%. Or your pageview to lead conversion rate by 20%.
Or imagine you find out that it’s easy to drive tons of signups to your email newsletter, but your email marketing campaigns aren’t driving results – time to optimize your email marketing program!
In any case, approximating the value of a conversion isn’t perfect science, but it does let you track revenue generated from content.
Ahrefs Analysis: an Easier & Less Accurate Way to Ascribe Value
If you don’t want to go through the hassle of actually tracking conversions and assigning a dollar value to your leads, or you don’t have access to this data but still want to make the case that your content is producing value, here’s an easy way to do it.
Just go to Ahrefs and type in a domain or their blog:
This will show you a “traffic value” metric. Basically, this tells you how much your rankings would be worth if you were bidding on them with PPC campaigns. It tries to estimate that value.
Of course, this isn’t wildly accurate for many, many reasons. But if you’re a freelance writer without access to complex growth models, it’s a good way to say, “hey, we’re driving traffic, but also valuable traffic.”
7. Calculate return on investment
The final step is to calculate your return on investment (ROI). If you really want to.
The ROI calculation formula for doing this is easy:
(Return – Cost) / Cost x 100 = ROI %
My advice is to simply forecast your breakeven point and then continue to build the flywheel by reinvesting the positive ROI back into your program.
You can also begin to measure content performance on a page-by-page basis, which is a solid starting point for content optimization as well as a data point on which types of content perform better than average.
Keep in mind that there are far more unmeasurable benefits to content marketing outside of pure, direct response revenue generation.
Less Measurable Benefits of Content Marketing
Even though ROI is an important metric, it’s not the only thing you should be looking at when evaluating your content marketing efforts.
There are a number of other benefits that are more difficult to measure, but are still important.
Some of these less measurable benefits include:
- Backlinks and strengthening domain rating
- Brand awareness and reach
- Thought leadership and industry expert status
- Partnerships and leverage
- Sales enablement
While these benefits are more difficult to measure, they’re still important to consider when evaluating your content marketing strategy.
Backlinks and Domain Rating
One shouldn’t look at a content marketing campaign in isolation, as this channel should be compounding and generate increased marginal utility.
As a website’s authority gets stronger, as a rule of thumb, it becomes easier and easier to rank content in search.
Good content generates backlinks. Backlinks strengthen your domain. The stronger your domain, the more content ranks. The more your content ranks, the more likely it is that people link to it.
You know what a flywheel is, right?
Building high quality links makes the content creation process easier and more lucrative. They’re synergistic.
Brand Awareness and Reach
Content marketing can also help you improve your brand awareness and reach.
The more people who see and share your content, the more people will become aware of your brand. And, as more people become aware of your brand, you’ll be able to reach a larger audience.
This also has the makings of a flywheel effect, or at the very least, a surround sound effect, where someone starts to see your brand everywhere or at multiple places in the customer journey.
Essentially, even topics that don’t convert well can have a “billboard effect.” They help you become more visible so that when people are ready to buy, they think of you first.
Take a query like “what is content marketing.” Probably not gonna convert to sales right away.
But seeing Content Marketing Institute (CMI) show up for this and tons of related terms unconsciously positions them as an authority in my mind. They also probably generate backlinks from rankings like this.
Even on “zero click searches,” where the click-through-rate to your page that ranks is zero or low enough to be irrelevant, the theory is that seeing your domain over and over again strengthens brand visibility and awareness.
Thought Leadership & Expertise
Another benefit of content marketing is that it can help you position yourself as a thought leader or industry expert.
Peep Laja, who runs CXL Institute and Wynter, once told me, “you’re in the business of selling expertise.” And the best way to showcase expertise, authentically, is through content creation.
Even just starting out writing solely blog content, this can lead to opportunities to speak at events, collaborate with other experts, or even write a book.
Expertise and trust are hard to quantify when it comes to the number of leads you’re generating.
They don’t fit neatly into the ROI formula. But I can tell you anecdotally that they are extremely helpful during sales conversations as well as for hiring people.
Partnerships and Leverage
When I worked at HubSpot, I really saw this benefit.
HubSpot has one of the most powerful content marketing programs in the world, not just for B2B marketers.
Thus, when reaching out to influencers for potential marketing campaigns, my response rate was insane. Just the implication of working with HubSpot was enough to garner some interest.
Plus, we were able to offer so many value-adds, from using influencer quotes in content to accepting guest posts to more involved co-marketing campaigns like collaborating on ebooks, webinars, and even integrations.
I’ve even found that simply writing guest posts is a great way to break in the door and start a more involved relationship with another company. It proves you can write great content, deliver on time, and add value.
Thus, the ROI of content, while it should be measured, will never be completely measured.
We’ve spoken mostly about acquisition – that is, lead generation and acquiring new customers.
Content can and should also be driving value for existing customers. You can use it to help onboard and activate new users or retain and add value to existing users.
You can run correlational analyses, and in some cases, controlled experiments, to quantify the value of this content. But it’s quite complex, and most are happy to simply see engagement and increased LTV from users or customers who engage with customer marketing content.
Last but not least, content should be helping your sales team close deals. This, referred to as sales enablement or sales acceleration, is usually a clear value-add, but is typically more qualitatively evaluated.
At scale, you can run experiments to gauge the impact of a particular piece of content, but at the end of the day it’s your sales team that knows if a piece of content (whether BOFU stuff like case studies or TOFU stuff like infographics) is resonating with qualified leads / potential customers and pushing them closer to being customers.
Even when we talk about content distribution, one of the first and easiest ways to do it is to have your sales team leverage what you’re creating.
Content marketing is a powerful tool that can help you achieve a number of goals. But, it’s important to remember that not all of these goals are easy to measure.
If you want to measure your content marketing ROI, it’s important to establish KPIs that map up towards business goals, analyze the costs of your content marketing program, audit your content analytics tools, determine an attribution model, and calculate a return on investment or at least a breakeven point.
But, it’s also important to remember that not all of the ROI of content marketing can or should be measured.
I’ve also excluded conversations around social media engagement and other channels that you could technically bucket under “content marketing.” We’ve mostly focused on blog centric content or website traffic, though obviously that’s a limited take as well.
But don’t let the unmeasurable stuff stop you from measuring what you can, as it can help you get further time and investment into building your flywheel.