Metrics for Measuring Internet Marketing ROI

1. Metrics for MeasuringInternet Marketing ROI Pete KeverPrincipal & Co-FounderGHI Internet Services

2. Agenda • GHI Corporate Overview (3 minutes) • What Is Internet Marketing? (5 minutes) • Why Internet Marketing Matters (5 minutes) • Creating an ROI Plan (2 minutes) • ROI Metrics: Processes & Tools (10 minutes) • ROI Metrics: Tactics & Examples (10 minutes) • Next Steps (2 minutes)

4. GHI is holding company comprised of seven privately-held firms in eight industries serving more than 5,200 clients worldwide.  With staff on four continents and 400 business partners distributing GHI’s 90+ products and services …

5. GHI Mission Helping CompaniesConnect Smarter™ with their customers, people, products, and processes to improve clients’ brands and grow revenues.

6. GHI Recognition & Awards Weatherhead 100 Award Entrepreneur of the Year Small Business of the Year Award Distinguished Marketing and Sales Award Who’s Who in Technology Award Cascade Capital Business Growth Award

7. GHI Recognition & Awards Team NEO Success Award Top 25 Internet Design Firms Top 30 Largest Telecom Brokers Telly Award for Film / Video Total Quality Management Gold Medal Award

8. SEM Experience / Success Stories • Success Stories… • Tire retailer grew web site traffic 600%; orders into call center grew 300% • Online furniture store grew revenues 900% within 24 months • Logistics firm attributed 70% growth to internet sales • Non-profit increased unique visitors from 600,000 to 3.2M • Major clothing retailer landed at the top of the Search Engine results pages in less than 2 months • Manufacturing client increased sales leads by 1000% • Distributor client achieved $250,000 in new sales within 2 months • Industrial manufacturer of arc furnace electronic devices generated $1M in internet sales within first 9 months. • By the numbers… • First Client 1997: Early Adopter • Managed more than 650 SEM Campaigns • Largest Competitive Web Firms in town Outsource 100% of their SEO Projects • 200+ SEM Partners worldwide & growing • SEM represents 60% Internet Revenues • 7 Staff Members dedicated to SEM The best way to find new customers… is to simply let them find you!™

9. SEM Partial Client List Air Enterprises American Coffee Services A Schulman Ashland University AtomicBox Logistics Atromick Auburn Environmental Bacons Information Brilliant Learning Centers Calfee, Halter & Griswold Callos Companies Cardinal Commerce Catan Fashions CBIZ Charter One Bank Chico’s Coldwell Banker Realty Computer Sciences Corporation Conrad’s Tire Express Copperloy Coral Company Ellin LaVar Textures Encompix Ganaden Bio GBS Gerspacher Real Estate Great Lakes Computer Greater Medina Chamber of Commerce Guardian Industries HomeOfficeDirect.com HH Greg Hoffman Group Honeywell Corporation IHomeSchool.com Interlake Stamping Jetdock Martindale Electric National City Bank NCLB Tutors Reich & Binstock Rick Santorum, US Senator RICO Equipment, Inc. Rocky Outdoor Gear Speith, Bell, McCurdy & Newell Stanley Proctor Taft Law Tape Rental Library The Coral Company Time Warner Cable Tradesman International Trillium Creek Valley City Supply Vernon Law Watteredge White Hat Management Worthington Precision Metals … Over 650 SEM Engagements since 1997 The best way to find new customers… is to simply let them find you!™

10. Internet Marketing Overview Web Design Online Advertising Search Engine Marketing (SEM) Email Marketing Social Media Marketing (SMM) • Branding • Content • Navigation • Usability • POD-Casting • VOD-Casting • Rich Media • Monetized Content • RSS Feeds • Banner Ads • Affiliate Marketing • Online Marketplaces • Forum Sponsorships • Local Advertising • Online Yellowpages • Shopping Comparison Sites Market Research • HTML Creation • Newsletters • E-Zines • Viral Campaigns • Surveys • Endorsed Emailings • Social Network Profiles • Blogs • Online Advocacy / Reputation Management • Social Bookmarking • Video Search • Viral Marketing • User Review Sites Search Engine Optimization (SEO) Pay Per Click Advertising (PPC) • Analytics • Code Optimization • Content Development • Link Building • PPC Ad Optimization • Search Term Research • Local Search Conversion Optimization • Clickstream Analysis • Origination Analysis • Landing Page Development • Multivariate Testing • Usability • Graphic Design

11. Why is Internet Marketing Important? • The Internet is still growing! In fact, the Internet is one of the few retail areas of • the current economy that is still experiencing double-digit growth. • $165.9 billion: Total U.S. Internet retail sales in 2007. • 1.5 billion: The estimated number of Internet users worldwide. • 190 million: The estimated number of American Internet users. • 12 billion: The number of searches performed per month on the Web. • 85%: The number of web users that start their web experience using Search. • 172 Billion: The number of email messages sent per day. • 210 Million: The number of combined Facebook and MySpace users. • 96 million: The number of blogs tracked by Technorati. Source: ClickZ

12. Why is Internet Marketing Important? Estimated Quarterly U.S. Retail E-commerce Sales as a Percent of Total Quarterly Retail Sales:4th Quarter 1999–4th Quarter 2007 Percent of Total Source: U.S. Census Bureau

13. Why is Internet Marketing Important? Internet Marketing, specifically SEM is targetable and trackable. Targetable – you can target and reach exact markets with your message, at the point in time they are willing to make a purchase decision. Trackable – you can get “instant” market intelligence from your campaigns that is either impossible or too costly to obtain in other media.

14. Creating Your ROI Plan { Define the Plan Plan Define Goals & Objectives { Establish Budgets Build Create Project Plans Identify Key Metrics { Measure Analyze, Repeat

15. ROI Metrics Measurement Process ROI = Research, Optimization, Intelligence Research Data discovery Optimization Improving your website to capitalize on the data Intelligence Learning about the results ONGOING

16. ROI Metrics Measurement Process Research 1. Empirical, timely, specific data about search behavior patterns is available online, at your fingertips, revealing the exact words your potential customers are searching with, and how much competition you face.

17. ROI Metrics Measurement Process Research 2. Today’s site traffic analysis software allows you to mine rich information about your site visitors: • How a visitor found your site; what keyword they used, and when • The exact path they took through your site • How long they stayed • At what point they left your site • Their geographic location • Whether they fulfilled one of your goals This data can be aggregated to give you a well-rounded picture of your overall site traffic, and whether you are attracting visitors that are likely to become customers.

18. ROI Metrics Measurement Process Optimization • We are no longer only a nation of sellers…We are becoming a nation of buyers. Hunters have become the hunted …The best way to find new customers…is to simply let them find you!™

19. ROI Metrics Measurement Process Optimization 2. One of the largest most profitable companies in the world – Google – is working to bring business to you. If Google doesn’t help you succeed…they don’t succeed. Optimize your site to drive search engine traffic to it. Then optimize your site to convert those visitors to buyers.

20. ROI Metrics Measurement Process Intelligence 1. Know how to interpret your web site traffic data. Keep making changes to your web and internet marketing plans.

21. ROI Metrics Measurement Process Intelligence 2. As you learn more about your site visitors, keep testing variations of your pages and content. Unlike other media, you can develop many versions of your ads and content quite easily and inexpensively. And you can get instant feedback on the results for comparative analysis.

22. Metric Measurement Process You will repeat the ROI cycle forever…why? • Market research data changes as user behavior shifts. • Thus, optimization tasks never stop. • And, you learn more every day as your gain more intelligence.

23. ROI Metrics Measurement Process The good news about this never ending ROI “cycle”: It all starts with facts during the market research, works alongside the mathematical science of search algorithms, and is improved upon by the creative minds of marketing people like you!

24. ROI Metrics Measurement Tools How To Carry Out “ROI” Research: Market Research • Think about how your company “goes to market.” What do you sell and to whom? • Research why people search for what you sell. Are they looking for a product? Are they solving a problem? • Study your site’s visitors. How many visitors do you get now? Where do they come from? If they use search engines to find you, what words are they using and what pages are they landing on? • Research web sites in your vertical market spaces, including blogs, message boards, periodicals, directories, social media sites and content aggregation sites. Do your customers use these resources?

25. ROI Metric Measurement Tools Research: Keyword Research for Search Marketing Creating an effective search engine marketing campaign means attracting visitors to your site with keywords that are most likely to convert them into a customer! Never assume the keywords your potential customers will use. Invest in an SEM campaign using the wrong keywords – and all of your efforts are in vain.

26. ROI Metric Measurement Tools Research: Keyword Research for Search Marketing Keyword research tools: • Google – use the free Keyword Tool at www.google.com/keywords and Google Trends at www.google.com/trends. • Wordtracker – subscription-based web site that contains samples of searches: www.WordTracker.com • Keyword Discovery – subscription-based web site that contains samples of searches along with geographic data: www.KeywordDiscovery.com

27. ROI Metric Measurement Tools Research: Keyword Research for Search Marketing Google’sfree Keyword Tool at www.google.com/keywords

28. ROI Metric Measurement Tools Research: Competitors Learning what your competitors are doing can help in formulating your own Internet marketing strategy. Competitive research tools include: • Competitors’ Web Sites – study their site for keywords and phrases they use. These might be effective keywords for you to use in your SEM campaign. After listing these keywords, use the keyword analysis tools to determine their popularity. • Google – conduct a back-link lookup to see what sites are linking to your competitors. Type link:www.YourCompetitor.com into the Google search box. • Compete.com and Quantcast – shows traffic trends for competing websites and demographic data. • SEODigger.com – find out for which keywords a site ranks high enough to be in Google’s Top 20.

29. ROI Metric Measurement Tools Optimization: Search Engine Marketing (SEM) SEM is comprised of: • Organic Search Engine Optimization (SEO) attempts to improve rankings for relevant keywords in search results by improving a web site's structure, content, and relevant back link count. • Pay Per Click (PPC) advertising uses sponsored search engine listings to drive traffic to a web site. The advertiser bids for search terms, and the search engine ranks ads based on a competitive auction as well as other factors.

30. ROI Metric Measurement Tools

31. ROI Metric Measurement Tools

32. ROI Metric Measurement Tools Optimization: Conversion Optimization Conversion Optimization: CRITICAL Improves specific web pages to increase the likelihood that a site visitor will convert to a customer or a qualified prospect. • Apply best practices in web design to help visitors find information that will help them make a decision. • Study traffic patterns to see which pages or content is performing on your site, and which are not. • Test various versions of web content to see which performs better (also known as multi-variant testing)

33. ROI Metric Measurement Tools Optimization: Email Marketing Email Marketing involves sending out targeted email communications to warm market leads or current customers, to improve communication and allow new sales opportunities: • Setup a newsletter to send corporate communications, promotions, or helpful information to your current customers or prospects • Capture email addresses from web site visitors by asking them to sign up for your newsletter, or require it to download a white paper

34. ROI Metric Measurement Tools Optimization: Social Media Marketing Social Media Marketing promotes your online brand by placing ideas within online communities with the hope that they will spread virally: • Depending on your target market, your organization or company might have a Facebook profile, a MySpace profile, or a LinkedIn profile, among others. • Your company should have a blog with specialized “content experts” that post at least 1 article per week, geared toward helping your potential customers make decisions. • Businesses and organizations with a local focus should have a local search engine marketing campaign, be active within local discussion boards, setup local profiles on community sites, and post testimonials on review sites.

35. ROI Metric Measurement Tools Intelligence: Web Site Traffic Analysis Software If you don’t have web site traffic analysis software running on your web site, get it set up immediately…you are flying blind! • If you host with a third-party provider, they can normally install a free or low-cost system. • Some traffic analysis software can run into tens of thousands of dollars. • Google Analytics is free of charge, www.google.com/analytics - and includes many features found in higher-priced commercial systems.

36. Key ROI Metrics Two types of High Level ROI metrics to track: Tactical metrics, such as higher search engine rankings or more site traffic. Strategic metrics, such as REVENUE, topline revenue, number of qualified leads, number of new name accounts, new distribution channels obtained, etc.

37. Key ROI Metrics Examples of Tactical ROI Metrics • Unique Web Site Visitors • Average User Session Length • Average Bounce Rate Per Page, or For Site • Popularity of Key Conversion Pages • Number of Top 10 Rankings in Google, Yahoo, MSN • Search Engine Referral Rate • Number of Search Engine Referrals • % Growth in Link Popularity • % Growth in Site Traffic • Top Search Engine Rank for Company Name • Top Search Engine Rank for Company Brands • Average % Search Engine Referral Rate • Number of National / Local Interviews • Number of Pickups / Mentions in Major Media (Fox, Cleveland Plain Dealer, Newsweek etc) • Number of Mentions in “Blogosphere”

38. Key ROI Metrics Examples of Client-Specific TacticalROI Metrics • Rank #1 in Google for brand names • Rank #1 in Google for company principals’ names, or law firm partner names • Google results page descriptions accurately describe a specific page on the site • Increase impressions for a PPC campaign • Push negative online press to 2nd page of Google • Rank #1 in Google for any keyword related to “Medina, Ohio” • Rank above competitors for competitor names and brands

39. Key ROI Metrics Examples of Strategic Based ROI Metrics • Total Sales – usually the most important metric! • Number of New Customers • % Change In Number of Sales • Average Sale Dollar Amount • Top Selling Products • Number of Leads Generated • Featured Promos Conversion Rate • Printable Coupons Conversion Rate • Average % Conversion Rate Vs. Industry Averages • Number of Newsletter Signups • Number of Surveys Taken

40. Key ROI Metrics Tactical Metric ROI Examples Metric: Top Ranking in Google for Keyword “ABC” Tracking Mechanism: Perform a test search in Google Value of Metric: Popularity of the keyword, effect on the online brand and number of potential site visitors:

41. Key ROI Metrics Tactical Metric ROI Examples Metric: Popularity of Key Conversion Page Tracking Mechanism: Number of times a key page was viewed in a month, compared to the rest of the site. Value of Metric: Percentage of overall site traffic that found the key conversion page.

42. Key ROI Metrics Strategic Metric ROI Examples Metric: Total Sales Tracking Mechanism: The web visitor reaches the “Receipt” page after checking out and paying. Value of Metric: Total Value of Sales.

43. Key ROI Metrics Strategic Metric ROI Examples Metric: Total Sales from Specific Keyword Tracking Mechanism: The visitor reaches your website via a specific keyword search, and reaches the “Receipt” page after checking out. Value of Metric: Average dollar per sale TIMES number of sales MINUS cost of top ranking for that keyword.

44. Key ROI Metrics Strategic Metric ROI Examples Metric: Number of Leads Generated Tracking Mechanism: The visitor reaches the “Thank You” page after filling out a Request Form. Value of Metric: Number of leads that convert to customers TIMES the average value of those customers.

45. Key ROI Metrics Strategic Metric ROI Examples Metric: Number of Leads Generated from SEO Campaign Tracking Mechanism: The visitor reaches your website via organic search engines, then reaches the “Thank You” page after filling out a Request Form. Value of Metric: Number of leads that convert to customers TIMES the average value of those customers MINUS cost of the SEO Campaign.

46. Key ROI Metrics Strategic Metric ROI Examples Metric: Number of Sales Generated from Email Newsletter Subscriptions Tracking Mechanism: The email subscriber clicks a link within an email newsletter, then reaches the “Receipt” page after checking out. Value of Metric: Number of subscribers that convert to customers TIMES the average value of those customers MINUS cost of the Email Campaign.

47. Next Steps Build IM as a core competency: • Hire: $150k for experienced SEM manager, another $40k for each SEM specialist. Potential $250k direct investment the first year alone plus sales and marketing costs. • Transfer: Many IM firms like GHIIS have coaching services that transfer knowledge, best practices, proprietary tools & systems, processes to you for a much smaller investment. • Partner: Strategically align with an outside internet marketing firm to co-own, co-brand or simply resell the service.

48. Next Steps • Clearly define the goals of your site. • Determine what elements within the Internet Marketing world make sense for the goals you are trying to achieve. • Establish defined metrics that you will use to track each of those goals. • Define, set up and manage the tools to measure the metrics - web site traffic analysis software. • Whether you decide for or against an SEM campaign, we recommend you conduct strategic market and keyword research to identify, validate and determine the optimal terms to reach and grow your target markets. This alone will impact your ROI for your web site and related IM campaigns.

49. Other Steps • Start an email newsletter using email marketing software that can track clicks to your site. Begin by sending it out once per month to your house list. • Setup a small test Google AdWords or Yahoo Search Marketing PPC campaign. You can start for as little as $1 per day. Coupled with web site traffic analysis, you can learn a great deal about your web site visitors in a short amount of time. • Do “ad hoc” usability testing with clients, partners, even friends & family. Assign them tasks on your site, watch what they do, and record it.