Money & Business Pro Tip: Think Beyond ROI

Thinking in terms of return on investment may not make sense for your association’s marketing initiatives. Instead, focus on your objectives.

When a marketing campaign needs to be measured, the natural place to look is return on investment (ROI).

But leaning too hard on the money you’re putting in now could limit the upside you see down the road. Fortunately, there’s another way to approach your marketing analysis.

What’s the Strategy?

Return on objective (ROO) is an approach to building metrics that examines individual campaigns in context of broader organizational objectives.

An example of what this might look like in practice: Rather than measuring the amount of work you put into your social media efforts, you focus on a key objective, which might be to boost engagement with members. This perspective can offer a longer-term understanding of how a particular initiative ties into your organizational goals.

Why Is It Effective?

It makes strategy, not financial investment, the star of the show—using money as the chief metric can incorrectly depict the performance of a given campaign, says Karl Van den Bergh, chief marketing officer of the cloud analytics firm Gigamon.

“If an organization were only to focus on ROI as the barometer of success, this would lead to over-investment in installed-base marketing to the detriment of new customer acquisition,” Van den Bergh writes for Forbes. “This might produce better short-term results but could lead to longer-term challenges.”

Putting a focus on ROO, he says, can make sure that initiatives are helping to improve longer-term organizational goals. For teams that do want to continue to use ROI, he adds that the two concepts complement one another.

“ROO can complement ROI by assisting marketers in tracking valuable components that can’t be tied directly to the top line but are required to run an effective marketing program,” he writes.

What’s the Potential?

ROO-based measurement can get your organization to focus on the full picture, rather than just on narrow results—and can come in handy for some of your biggest initiatives, such as planning events.

It can also be an effective strategy for working with sponsors to help show the broader impacts of their work rather than just the financial results—an approach the Association of National Advertisers recommends.

Now, there will always be room for ROI, in part because it’s easy to explain to stakeholders—but the good news is that because it’s complementary with ROO, you can measure (and get the benefits from) both. 


(Makhbubakhon Ismatova/iStock/Getty Images Plus)

Ernie Smith

By Ernie Smith

Ernie Smith is a former senior editor for Associations Now. MORE

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