The new directions of marketing and business communication show us a reality quite different from what was experienced a few years ago. We have left behind the era of uncertainties and assumptions and firmly entered the era of information, data, and metrics.
This new perspective has brought countless changes to the routine of professionals in these areas, who have had to get used to the use of new tools and means of communication to convey their messages, whether to the internal or external public.
Digital tools are responsible for producing strategic data for companies, which can benefit from them to measure the results of their campaigns.
In this post, we will address one of the most important metrics for marketing and communication analysts: ROI. You will see how the ROI of business communication should be measured and how this data helps the company make more assertive decisions.
The importance of ROI
Basically, ROI distinguishes profitable procedures from non-profitable ones. By pointing out the return obtained on an investment made, the company manages to have important data at hand that translates the cost-benefit of that procedure.
Peter Drucker, one of the most important marketing theorists, says that a company that cannot measure its results is not capable of making good decisions, and this is what ROI aims to help with, in strategic decision making, based on cost-benefit.
The ROI calculation is done as follows:
[(Return – Investment) / Investment] x 100 = ROI (in %)
Is ROI alone enough?
Working solely with ROI will make your analysis fall far short of expectations. In fact, to accurately measure ROI in business communication, it is necessary to have other metrics that assist in data interpretation, such as engagement data, evaluations, and surveys.
Focusing on communication, ROI will demonstrate whether money is being well applied in the proposed actions and will help the company determine which projects deserve more funds for their continuity and which should be terminated.
Let us take an example:
If a company invested 40,000 reals in a lecture cycle to motivate its sales team and managed to measure that the team’s performance improved (see how important it is to combine ROI with other performance metrics?) and sales revenue grew from 500,000 to 650,000, we can say that the Return on Investment was:
- ROI = [(150,000 – 40,000) / 40,000] x 100
- ROI = [ 110,000 / 40,000] x 100
- ROI = 2.75 X 100
- ROI = 275%
Faced with this figure, it is possible to say that the choice of the motivational lecture was a success, after all, it brought considerable results to the company, therefore, it can be a productive action that can be carried out more times, given that its return is attractive.
In some cases, measuring ROI seems intangible, after all, it is not always possible to have an exact notion of the return brought by an action. A good example in the field of communication is press office/PR. Many PR agencies evaluate their return by looking at how many reports mentioned the company and estimating how much the company would have to pay to have its name featured in that communication medium.
If your company intends to optimize its analyses of investments made in communication, it is advisable to also analyze other data such as:
Feedback
It is during a feedback session that internal communication professionals can measure whether campaigns are positively impacting employees. Good internal communication relies heavily on feedback.
Productivity
Maintaining control or analysis of employee productivity is also fundamental to measuring how communication actions are impacting the work environment and acting in favor of the company and its results.
Engagement
Internal business communication aims to generate employee engagement within teams; it is very important to align teams and individuals with the company’s expectations, mission, vision, and values. Without measuring engagement, the company cannot understand if its actions are productive.
These are some important pieces of information to keep in mind when it comes to ROI and how it can be applied (along with other metrics) to evaluate internal communication actions.
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