Digital marketing

Why So Many Entrepreneurs Don’t Know Their Digital Marketing ROI

Why So Many Entrepreneurs Don't Know Their Digital Marketing ROI

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Let’s make a bet.

Currently, 55% of small business owners plan to invest more in their digital marketing strategies. It is unclear what percentage of business owners are already investing in digital marketing, as it is a broad concept that is difficult to define precisely. But let’s assume that at least three-quarters of existing businesses spend money on digital marketing in one form or another. Most of these companies have been investing in digital marketing for months, years, or even decades.

So if you asked them individually, what percentage of these business owners would be able to tell you what their marketing return on investment (ROI) is?

Do you think it’s 90 percent? Or closer to 80%?

The exact numbers vary depending on the strategy you are looking at, but 44% of companies have no means to measure their return on investment on social networks. And those who can measure their social media ROI may not be doing so consistently or effectively.

Extend this concept to the rest of the digital marketing field. Why do so few entrepreneurs know their marketing ROI when it is such an important concept for long-term marketing success?

Related: 9 Low-Budget Marketing Strategies Every Startup Can Afford


Often the problem is entrepreneurial apathy. Some entrepreneurs simply don’t care about their return on investment. But why is this the case? There are several possibilities. For starters, entrepreneurs may underestimate the value of ROI in a digital marketing context. If they don’t understand its meaning or how to use it, they won’t bother measuring it.

Other entrepreneurs may be more interested in achieving a specific goal or milestone. If they are extremely determined to reach a subscriber count of 100,000, for example, it doesn’t matter what it costs to get there.

Lack of tools

Some entrepreneurs claim they can’t measure ROI or don’t measure ROI because they don’t have access to the tools that would allow them to do so. Obviously, you’ll need a way to track and measure your digital marketing progress if you want to calculate your return on investment.

But there really is no excuse for that. There are plenty of free tools out there to help business owners determine their marketing effectiveness and boost their campaigns — and most of them are ridiculously easy to use. Google Search Console, for example, allows entrepreneurs to get detailed insight into how their website is performing and how it appears in search engines. If you choose to market with a social media platform such as Facebook, you will have the ability to review large amounts of important performance metrics in the back-end at no additional cost or subscription required.

Related: 3 trends to retain customers in 2022

The nebulous nature of ROI

A legitimate complaint from entrepreneurs is that ROI can be difficult to measure accurately. You may know how many conversions you’re getting or how much your organic traffic has increased, but can that really tell you what your ROI is?


  • Ambiguous costs: how much are you spending on marketing, really? If you work with a marketing agency, you might have a simple monthly cost. But even then, you will have to calculate all the hours you spend on administration and other details and calculate the costs for the company.
  • Misleading Data Points: Some data points you measure will not be clear or provide you with an accurate assessment of your marketing effectiveness. For example, your conversion rate may be high, but if the people who fill out your forms aren’t buying your products, your ROI may be lower than you think.
  • Unmeasurable impact: Digital marketing can affect your performance in a number of ways, some of which are nearly impossible to measure. For example, how can you prove that your brand visibility or reputation is improving?

ROI as a secondary metric

I touched on this concept earlier, but it has a potentially bigger impact. Some entrepreneurs view ROI not as a primary metric to gauge the success of a marketing campaign, but as a secondary metric. For example, think about SEO. SEO is a strategy designed to help businesses rank higher in search engines. So it’s reasonable to suggest that the number one goal here is to achieve #1 ranking for a target keyword. However, it is possible to reach #1 and end up with a negative ROI; if you spend more money than you earn on a given strategy, you should not consider that strategy a success. Similarly, you can find yourself in a position well below the top rank and still have a very high return on investment.

The solution

In my opinion, ROI is the most important metric you need to know for digital marketing success. If you can’t tell for sure whether your marketing efforts are working or not, your campaign could actually be hurting your brand. And, no matter what, you will miss the full potential of your digital marketing strategies. All business owners involved in digital marketing need to monitor their ROI closely and consistently. Otherwise, all your investment and effort could end up being wasted.

Related: How to Increase Your Marketing ROI with Personalization and Multiple People