Undoubtedly, the return-on-investment is your most important marketing metric. If you can determine the payoff in profitability for your marketing initiatives/investments, and satisfy yourself they make the whole thing worthwhile, you have a winning formula. Certainly, in two years of evaluating “best of show” marketing awards for the Society for Marketing Professional Services (SMPS), the ROI to me was the most significant consideration in evaluating which entry I thought deserving of the highest honours — and my fellow judges often shared the same perspective.
Of course, ROI measurement, like any other meaningful metric in architectural, engineering and construction marketing, has proven to be challenging in part because of the long lead cycle for many projects, and the multiple variables involved in the process. These challenges are largest on the biggest projects. How do you measure your team’s success/failure when you come second in a $100 million project, with months of preparation, negotiation, and short-list interview co-ordination? Obviously, in this circumstance, the ROI would be terrible — and it might be equally bad if, after fighting to win the job, you discover you’ve under-bid it, or there are problems that turn the whole thing into an unprofitable mess.
Nevertheless, you can certainly develop tools to measure your ROI, and you should. Otherwise, you are travelling in the dark. Some methods include:
Time recording: Give a marketing accounting-time code to principals and project staff, as well as marketers, so you can see how much time (and how much salary-equivalent cost) your organization’s staff are dedicating to marketing and business-development activities. There are indications that the more senior people invest their time and energy in the pre-proposal relationships, and in developing the actual proposal, the higher the chance of success. The ROI here, in fact, depends on sufficient investment in the process.
Lead source tracking: You want to track your leads, from trade shows, speaking engagements, advertising, web inquiries and the like. If there are costs associated with the lead generation activity, keep track of these as well — then match the number of leads against the costs, and once you’ve given the process enough time, you should be able to calculate your project ROI.
Lifetime value: This metric can be both enlightening and rewarding, and (in some circumstances) turn what seems to be an expensive effort into a bargain. Say, for example, you decide to expand into a new community/association/market niche, and you spend the hours and resources to get things started — and you have an idea of the overall life-cycle value for repeat and referral business from your new clients. The higher the lifetime value, the more worthy the initiative.
The challenge here of course is all of these strategies require some systems organization, time, effort, and in the short-term don’t generate much in the way of useful data, especially if your sales/project cycle requires many months (or even years). You need to stay the course — and this can be hard to do with distractions, stress, and constant last-minute pressures.
Yet ROI measurement can, and should be, the basis of your marketing budgeting and planning. Give it the time it deserves, and you’ll be way ahead of the game over time.