It’s a question that keeps every small business owner up at night: How do you know your online marketing is actually worth the money and effort?
Not only can it be difficult to tell when you’re getting the most bang for your buck when it comes to online marketing, but no practice has unlimited resources. It’s important to make the absolute most of what you have.
If you’ve never gone through the steps to find out how worthwhile your marketing methods are, the good news is it’s quick and simple to calculate your return on investment (ROI).
–> See how effective your marketing is in real time! <–
Sign-up for a free trial of the Brighter Insights Tool.
What Is ROI?
ROI is a standard measurement used to learn how effective a form of investment is.1 In the case of online marketing for your practice, your “investment” is how much money you paid for a specific type of marketing.
For example, if you advertise on Google AdWords, and you also pay to promote your posts on Facebook, you would calculate your ROI separately for your investment in the Google Ads network and your investment in Facebook paid promotions.
Calculating the ROI for a certain marketing investment shows us exactly how much that marketing method grew your monetary investment, or how much of a profit you’re earning with one marketing method versus another.1
How Do You Calculate Basic ROI?
Here’s the easy part. To calculate ROI and find out which of your marketing methods is the most lucrative, simply complete out the formula below using your relevant information.1
In this formula, “Gain From Investment” is the total amount of money that you’ve made from this particular marketing investment and “Cost of Investment” is the total monetary amount that you invested.
For example, say you spend a budget of $1000 a month on Google Ads. In that month, the clients that you get directly through your Google Ads investment have netted you a total of $1300 in appointment fees. In order to calculate the ROI for your Google Ads investment, you would calculate the following:
($1300 – $1000) / $1000 = 0.3
Your calculated ROI is 0.3, or 30%. That means that for every dollar you invested into your Google Ads budget, you made a $1.30 back.
Why Is ROI Important to Your Practice?
While there are many marketing methods that will give you a positive ROI, calculating their exact ROI shows us that not all marketing is created equal. Some of your marketing methods serve you (and your budget!) better than others.
For example, say we have two marketing methods – A and B – that both have a positive ROI. Method A has an ROI of 10%, and method B has an ROI of 20%. Even though both methods are making you a monetary profit, you would have to invest twice as much money in method A to make the same amount of profit as method B.
Like we mentioned earlier, no practice has unlimited resources – in fact, many practices have very limited resources, especially when you’re just starting out. That makes it more important than ever to check your marketing investments with an ROI calculation to help you pursue the marketing that gets you the most bang for your buck.
Want to Learn More?
We have written a LOT of articles on therapist marketing. If you enjoyed this article, we think you’ll also really enjoy these ones:
- The Therapist’s Guide to Google AdWords
- Creating a Google Ads Campaign for Your Practice
- Your Private Practice Guide to Facebook Advertising
- Paid Advertising: Does it Make Sense for Your Private Practice
Still trying to do all your online marketing on your own? Save yourself the headache.
Brighter Vision is the ultimate marketing package for therapists, centered around the best therapist website you’ve ever had. Fill out the form below to learn more about our team of professionals who can’t wait to help your practice grow like never before. 🙂
1. Chen, J. (2019, February 11). Return on Investment (ROI). Retrieved from https://www.investopedia.com/terms/r/returnoninvestment.asp