Content Marketing ROI Explained

ROI. Those three magic letters—which stand for “return on investment”—form arguably the most important acronym in a marketer’s life.

For businesses everywhere, there’s mounting pressure on marketing teams to demonstrate clear ROI for their efforts. The people holding the purse strings want to know that the money going into the marketing machine is well-spent.

Unfortunately, measuring the ROI for a content marketing strategy is no walk in the park. Content marketing is a long-term, wait-and-see approach that delivers results in months, not minutes.

Even so, content marketing ROI can—and should—be measured. Not only will the accountants be happy, but so will the rest of the stakeholders. When decision-makers understand the impact of content marketing on leads, sales, and business growth, they can make better decisions.

What Is Content Marketing ROI?

As always, the first step is to grasp what’s being measured. In simple terms, content marketing ROI is a metric that shows how much profit a content marketing strategy is generating.

ROI is crucial in the world of content marketing because, well, producing and sharing content costs money. Yes, it may cost less than a full-scale pay-per-click ad campaign. But to create high-quality content, brands typically have to shell out for numerous expenses, including:

• Staff salaries.
• Costs associated with producing content (writers, actors, locations, etc.).
• Editing tools (video editing software subscription, Grammarly for copy, etc.).
• Any ad spend used to amplify reach.

When brands don’t calculate the full extent of their content marketing expenses and the resulting revenue, the strategy can go south. Understanding ROI is vital for securing budgets, optimizing approaches, and aligning content with business goals.

How to Calculate Content Marketing ROI

So, how does one determine the true ROI of a content marketing strategy?

Fortunately, the math is relatively straightforward. The content marketing ROI formula is as follows:

(Revenue Generated from Content – Content Costs) ÷ Content Costs x 100 = ROI

One half of the equation—content costs—has already been covered above. Brands should take care to include every single expense in this category. After all, fudging the numbers only harms the business.

The other half of the equation—revenue generated from content—is slightly tougher to pin down. Content marketing campaigns are phenomenal for increasing brand awareness and bringing in new leads. But it’s hard to know how much cash is coming in as a result without knowing what to track.

Some of the revenue-generating metrics to include in calculations are:

• Leads influenced.
• Closed-won opportunities.
• eCommerce sales.

The real challenge with calculating content marketing ROI is recording accurate data. As such, performance measurement tools are essential. (More on that later.)

The Formula in Action: A Hypothetical Example

To understand ROI calculations, consider this (highly simplified) example.

Imagine that Brand XYZ has decided to post informative blogs on their website. After paying a copywriter and an editor, their content costs for the month total to $700.

Thanks to analytics tools, Brand XYZ knows they’ve driven $2,000 in new sales with this blog strategy.

Plugging those figures into the formula results in something like this:

(1300 – 500) ÷ 500 x 100 = 185.71%

(Because ROI is expressed as a percentage, the whole shebang is multiplied by 100.) In this case, Brand XYZ can confidently say they’ve achieved a 186% content marketing ROI. Not bad for the first month of a blog strategy! That’s just north of the average return of 177%.

Key Metrics That Indicate Content Marketing Success

Of course, the numbers won’t always be as clean as the above example. Calculating ROI successfully means tracking all kinds of content marketing data.

Amidst all the noise, metrics worth paying attention to include:

• Website traffic – Traffic may not be a direct revenue indicator, but there’s a correlation. When organic sessions and new users increase, profit tends to follow.
• Lead generation – Proper content marketing strategies can drive Marketing Qualified Leads (MQLs) and form completions, both of which translate to more sales.
• Engagement – Content can only convert if it’s engaging. On websites, brands should use time on page and bounce rates as yardsticks; on social media, shares, likes, and comments are the gold standard.
• Sales attribution – When multiple content streams exist, brands must “attribute” sales to each one. Sales attribution allows businesses to calculate a separate ROI for each content channel, then focus on the best-performing ones.
• Customer retention and loyalty – According to popular wisdom, returning customers spend 67% more than new ones. (These repeat sales also cost less to acquire.) To that end, brands should track how much customers engage with content post-sale.

With an eye on these metrics, businesses can calculate revenue derived from content marketing.

Challenges in Measuring Content Marketing ROI

There’s one small snag: Making sense of all those measurements can be easier said than done. Compared to direct response marketing, content ROI is trickier to track accurately.

There are three primary reasons for the extra effort involved.

Long Sales Cycles

As mentioned earlier, content marketing is a slow-burn strategy. Guiding customers through the funnel can take months, especially in B2B industries.

There’s nothing wrong with the longer timeframe—after all, content marketing should never feel like pushy marketing—but it does make the math more challenging.

For instance, in the Brand XYZ example above, the first month could have yielded no results, particularly if the XYZ sales process is lengthy. Seeing a negative ROI in the first month, decision-makers might opt to pull the plug.

However, the value of content compounds once it’s published. In the third month, $5,000 of new sales might come in through the blog, with more leads midway through the process.

All this is to say that content marketing requires patience—and that the patience is worth it.

Multi-Touch Attribution Complexities

Just as content marketing can be a many-month endeavor, it can also be a many-touchpoint approach.

While some customers may go directly from an Instagram reel to the checkout page, others might take a more indirect path. Depending on the product, buyers may go through as many as 8+ touchpoints before purchasing. These could include:

• Social media posts.
• Blogs or whitepapers.
• Ads.
• Direct emails.
• Product reviews or testimonials.

When the sale finally goes down, which of these channels was responsible?

Leading businesses know the correct answer here: all of them. Brands should recognize content marketing as a holistic affair, not a disjointed collection of channels. In doing so, the ROI picture becomes clearer—and that’s better for everyone.

The Indirect Influence of Content

Content marketing strategies have countless direct effects on consumers. However, they also play an indirect role.

A behind-the-scenes TikTok of the manufacturing process may not lead to a sale, but it could promote brand awareness, inspire customer confidence, and set the internet ablaze with discussion.

These benefits are invaluable—and largely immeasurable. “Brand trust” doesn’t fit neatly into the Content Marketing ROI Equation, but it does drive sales.

Ultimately, brands should understand that some content marketing ROI may be impossible to capture in a percentage. Including all data points is still the goal, but at the end of the day, marketing teams should trust the process and recognize the value—tangible and intangible—in content.

Best Practices for Proving Content Marketing ROI

With obstacles to overcome and nebulous metrics to measure, how can marketing teams demonstrate the value of their content efforts? While the path forward will vary company to company, these content marketing ROI best practices are universally recommended:

• Set clear goals and KPIs – Before publishing anything, marketers should define what success looks like. With well-defined objectives, content can be created purposefully. If the goal is more sales, posts can point toward buying; if customer loyalty is the aim, content can explain the benefits of a long-term brand-buyer relationship.
• Implement tracking systems – Knowing isn’t half the battle here—it’s the whole war. Marketers should use UTM (Urchin Tracking Module) parameters to determine where traffic comes from, then apply CRM integration and marketing automation to streamline tracking.
• Map content to funnel stages – Ideally, each asset should be tied to a specific phase of the buyer journey. By mapping content to the different funnel stages, marketing teams can create more effective content and deploy it at the right time and place.
• Regularly report and adjust – Brands should make a habit of analyzing content marketing results and refining their strategy based on the insights. Tools like Google Analytics, Semrush (for SEO), and the built-in dashboards on social media are supremely helpful.

How Strong Content Marketing ROI Impacts Overall Business Growth

The beauty of improving content marketing ROI is its cascading effect on other parts of the business. ROI grows the bottom line, yes, but it also contributes to brand growth in other ways.

A robust content marketing strategy with a high ROI can help:

• Drive sales efficiency, making life easier for sales and marketing.
• Lower customer acquisition costs (CAC).
• Improve customer lifetime value (CLV).
• Strengthen brand equity (i.e. consumer perception).
• Create lasting value without increasing costs, since content is permanent.

Raise Your Content Marketing ROI

Make no mistake: calculating and improving content marketing ROI takes time and effort—but the payoff is worth it. With a strong strategy and the right content marketing partner, you can drive revenue on virtual autopilot. Quality content doesn’t just show up once and disappear—it continues working across every stage of the funnel, guiding buyers toward their first (and next) purchase.

Of course, realizing that impact requires action. As Ben Dutter, Chief Strategy Officer at Power Digital, puts it: 

“You have to actually DO things in order to have a better marketing program…We’re straight up telling you that it’s losing you money, it can be easily optimized, and you can spend less and get more.”

The choice is yours. If you need help measuring—or maximizing—your ROI, Power Digital is here to help. Our content and digital marketing experts have been implementing successful strategies for years, and we’re ready to make this year your year. Contact us to find out more.

Sources: 

Forbes. Top Content Marketing Statistics. https://www.forbes.com/advisor/business/software/content-marketing-statistics/

Business.com. Returning Customers Spend 67 Percent More Than New Customers — Keep Your Customers Coming Back With a Recurring Revenue Sales Model. https://www.business.com/articles/returning-customers-spend-67-more-than-new-customers-keep-your-customers-coming-back-with-a-recurring-revenue-sales-model/