Let’s take a look at return on investment (ROI) and online video
Most of us accept the notion that online video has an engaging and persuasive effect on its viewer audience. In fact, I blogged about viewing habits of senior executives a few days ago. In that blog post I reviewed a study by Forbes Insights and Google, and how business related web videos effect the purchasing decisions of senior executives. However, we do get asked by business managers how ROI on web video should be measured.
Establish your goals and objectives
What do you want your online video marketing campaign to achieve? Who is your target audience and what message do you need to deliver?
For example, are you trying to bring attention to an upcoming seminar or trade show and you need to attract more visitors? Do you need to reduce travel expenses? One of the most common goals is the reduction of travel costs by demonstrating a new product via a training video instead of having a technical or sales representative fly to customers’ sites. A company’s travel costs (air fare, hotels, car rentals) may be a significant part of the sales and marketing budget, and travel related expenses are typically some of the first expenses a company will seek to reduce through video communications.
Additional cost savings can be achieved by converting print marketing to online video
Some organizations will look to reduce their brochure printing budget. Our experience has shown that marketing brochure print jobs can run anywhere between $5,000-$20,000. An online marketing video can certainly be produced for a fraction of that cost with virtually free distribution anywhere on the Internet. Changes and corrections are easily made by your video production team.
Video has become an important communications tool similar to email or even your fax machine – would it be prudent to measure ROI for email?
Using video analytic tools to measure the viewing habits of your web visitors
Some of our clients get detailed data from their analytic tools which tells them how many people watched the videos, and how many watched all the way through. How many viewers clicked through to a shopping cart versus how many visitors clicked through to a shopping cart without watching a video. There are several video hosting platforms we use at eTown Videos which provide excellent analytic tools.
You may also want to review how many hours of work your organization saved since posting videos online. For example, one of our clients offered virtual tours of their educational facilities. It greatly decreased the number of calls from prospective students wishing to learn more about the organization and the students came away with a better idea of the facilities’ appearance than if they had only verbal descriptions. There are examples of students who signed up for courses primarily because they have seen an engaging and informative video.
We have clients who shared with us that they achieved a significant increase in online sales after posting a video on their website, in one case as much as 50%. Keep in mind, an increase in leads or sales can occur in two ways: increased conversions rates which is common if your site already receives a fairly large amount of visitors. Or an increase in traffic to your website after the video has been seen on video websites such as YouTube or MetaCafe.
Therefore, to assist you in quantifying ROI, keep these three points in mind:
1. Clarify objectives
2. Analyze using video analytics tools
3. Quantify the data