Which Channel Gives the Best Initial ROI?

I often get asked, “Which marketing channels generate the best initial ROI?” My answer is always the same! It depends on the industry, the type of business, and the budget. Every business is different, and there is no on-size-fits-all solution. And quite frankly, calculating digital marketing ROI in general can be pretty tricky!

Why? Because ROI must be based on well-defined variables in order to be useful. Part of the problem here is that many companies struggle to determine what those actually are, as there are many ways to define cost, revenue, and investment. Not only that, but there are many forms of “return” which are imprecise, such as brand reputation, credibility, and trust.

While there are major variations that make this a difficult question to answer, there are some tried and true strategies that many of our clients have had great success with when are starting out.

Let’s take a look at and compare some of the most popular digital marketing strategies that are heavily invested in at the start:

Content Marketing & SEO

It’s important to call out content marketing first, since it ultimately drives the entire success of your online presence.  You must have great content if you hope to succeed, and many times this is overlooked when developing a marketing plan. This is a big mistake. One of the great benefits of content marketing and SEO is that it’s technically feasible to get started with no monetary investment.  However, it will take a significant amount of time if you want to have a solid strategy through great content. And time is money. The true power of content marketing and SEO is their ability to scale over time, building long lasting value for your brand in terms of trust and awareness.

Email Marketing

Email has proven itself time and again to be the highest ROI online marketing strategy when utilized properly. Part of the reason for this is the low cost in regards to time and money for creating and sending out emails. However, there is a growth factor to consider for this channel.  As the value of your campaigns increase, so will the size of your list. And getting that list built up and managing it can become pricey.  Especially if you opt for an email marketing tool that comes with an expensive monthly price tag.  You’ll want to make sure that your email campaigns are generating enough revenue to justify any third-party costs.

Social Media Marketing

Social media marketing is another channel where it’s feasible to get started with the only expense being time.  But this can quickly escalate to thousands of dollars per month, depending on the scale of your efforts. This is especially true if you need to outsource the work to a third-party or agency. As for measuring the value? That can be hard to nail down.  You can measure vanity metrics like engagement (likes/shares), traffic, conversions, etc., but it’s hard to accurately quantify the reputation value you’ve acquired for your brand. And that’s one of the greatest benefits to social media!

Paid Advertising

I’ve seen both sides of the coin when it comes to Paid Advertising. It can either be fantastic for a business, or completely worthless.  Again, it all depends on the industry, as the price per click in Google AdWords can vary drastically from vertical to vertical, sometimes up to $50 or more per click.  Plus, you’re not really “building equity” with paid campaigns. It’s more like paying rent – once you stop paying, the ads instantly turn off, and you don’t have any lasting value (unlike SEO). But that is also one of the benefits of PPC – you can set it up in minutes, and if you see certain campaigns or keywords aren’t working, you can quickly adjust and put your money towards other ones.

Final Thoughts

So which one is the best?  It’s tough to pick a clear winner, especially after acknowledging all the different variations that go into this decision. In the short-term, paid advertising has the potential of giving you a strong return (again, depending on the industry!), and email marketing works the best for the majority of businesses. However, if you had to pick just one to start with, Content Marketing and SEO is an excellent investment.  With its range of benefits and the ability to be reused on other channels, there’s just no better way to spend your marketing budget at the get-go. But don’t forget to pursue these other strategies once your content is rock solid!

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Our marketing team is always on the prowl for useful facts and internet tidbits. Be sure to check our blog often for all of our updates and posts!


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