ROI Measurement

Take a step back and look at your marketing strategy.

    * You’re promoting your business online, in print and at in-person events ― but is each channel connecting you with the qualified, high-value prospects you want?
    * Prospects are clicking to your Web site ― but are you converting those leads to new business?
    * You have a client-development budget ― but is it based on hard data about which strategies are working for your firm?

Bottom line: are you getting good value for your marketing dollar?

Factoring return on investment, or ROI, into your growth plan is one important way to ensure that you are. ROI measurement helps you zero in on key information ― how prospects find you, how successfully you’re converting them, which strategies are cost-effective ― that can save money and expand your client list.

It’s a three-step process:

1) Tracking leads generated and other information for each channel — Web, print ads, broadcast and others — that your business maintains.  
2) Evaluating which channels are delivering quality prospects and which tactics need fine-tuning.
3) Modifying your marketing effort based on that information.

For Web-based marketing, the good news is that there are powerful analytical software programs, (which often are included when you sign up with a Web-site provider) that can help you assess:

    * What site content is most valued by visitors.
    * Which keywords, search engines and other referral sources generate the most visitors.
    * How many client intake forms are submitted from your site.
    * Total visitors and page views.

That’s good information for isolating under-performing site content, making search-engine-friendly edits and getting “bang for the buck” from online ads and paid placements.

Lead tracking doesn’t have to be fancy. Assign your receptionist to record telephone inquiries. Create a new-client information sheet for word-of-mouth referrals. Just keep it consistent (capture the same information from prospects no matter how they reach your firm) and sustainable enough to incorporate, long-term, into your practice management.
I'm going to make a change to this (I wrote it a while back for small law firms). Your lead tracking should be much more advanced in 2010. Separate phone numbers are pretty cheap now, get some you can track how many calls you get from each source. Use specific intake forms for your different online advertising campaigns. For a very small investment, you can track results from all of your advertising.

With that data in hand, you can take the next step and calculate which marketing channels are delivering the best value in terms of:

    * Lead quality. One channel may drive a high quantity of leads to your business while another delivers great quality (higher rate of conversion or average value per client). Your journal ads may primarily reach the corporate market while individuals find you online.
    * Cost per lead. For each channel, compare the amount you’re paying per lead. Cost per lead for television and Yellow Pages, for example, often is higher than Web-generated leads.
    * Lifetime value. Consider the big picture — the lifetime value of a client, not just the value of the matter on your desk. Could this client develop into a long-term relationship? And generate multiple referrals for your firm in the process?

Of course some marketing strategies — volunteerism, sponsorships — may score low in financial terms but still deliver by generating name awareness and planting the seeds for future business.

Moving forward

Ultimately, the goal of ROI measurement is to make better, more informed marketing decisions: to invest more where you’re seeing results and rethink strategies that aren’t delivering.

Online, that could mean improving your visibility on the legal directories and search engines that drive your Web site traffic with the highest profitability. Or revamping less-visited areas of your site.

By taking ROI into account and using tools like Web analytic software, you can base these decisions on solid data rather than guesswork.

And that can translate into more new clients and a better return on your marketing budget.