To determine the value of content marketing efforts, marketers would benefit from a content marketing return on investment (ROI) calculator. A content marketing ROI calculator removes a lot of the friction associated with determining content marketing return on investment.

According to research from the Content Marketing Institute, 47% of B2B marketers and 34% of B2C marketers don’t measure the ROI of their content marketing efforts.

Why? Many find the process to be too difficult or time consuming. However, determining content marketing ROI isn’t just important, it’s essential. Why engage in the time-consuming process of content marketing if you’re not sure it’s helping your business?

In this guide, we hope to remove some of the friction that comes with determining content marketing ROI by taking you step-by-step through the process. We’ve also created a nifty content marketing ROI calculator that will hopefully make the entire process move much more quickly.

Keep reading to learn how to gauge the impact of your content marketing efforts.

What Is Content Marketing ROI?

In a word, content marketing ROI is a metric that compares the gains from content marketing against the cost of those content marketing efforts.

Like most ROI calculations, it’s typically determined via the following formula: Return - Investment ÷ Investment = ROI.

Seems pretty easy, right? Well, not so fast. There’s a reason that lots of content marketers get bogged down when performing this calculation. Allow us to explain.

Why Content Marketing ROI Is Hard to Calculate

If every person who read an article on your blog converted into a sale, your content marketing ROI calculations would be a breeze (and your Return would be extraordinary). But as far as we’ve seen, that’s never the case.

In reality, your Return is not something readily available. It requires diving into a bunch of other metrics, averaging them out, and figuring out how they roll up into a Return. This process requires some complex math, which many marketers don’t particularly enjoy.

Furthermore, it takes time to gather a data sample that is representative of your content marketing performance. Think about it: A week’s worth of data on your content marketing performance will probably look very different from several month’s worth of data.

And just what are these other metrics that can be representative of your overall content marketing ROI? Well, the metrics marketers tend to follow to evaluate content performance include:

• Social engagement
• Pageviews
• Scroll depth
• Time on page
• Email subscribers
• Leads generated
• Sales generated
  

But there are additional metrics that can’t be assigned a number. This includes:

• Brand perception
• Brand authority
• Search Engine Optimization (SEO) success
  

Keep in mind that not all of these metrics apply to every content marketing channel (i.e. you can’t track pageviews on a podcast). Therefore it’s important to only measure ROI on one content marketing channel at a time.

What you need to determine is how the metrics you’re tracking roll up into return on investment. For example, how many pageviews does it take to generate a lead? How many leads does it take to make a sale? What is the value of a sale converted through content marketing?

This isn’t so easy to identify.

Furthermore, while every brand wants to maximize their content marketing ROI, some will prioritize certain metrics over others. For example, your brand may think maximizing email subscribers and ebook downloads is more important than generating pageviews and increasing time on page. 

And this doesn’t take into the account content marketing ROI for B2B vs. content marketing ROI for B2C, each of which requires different math. 

So as you can see, calculating content marketing ROI is tricky. To help you figure it out, let’s show you an example.

Content Marketing ROI Calculation Example

Let’s say you head up marketing for an enterprise brand, and you want to measure the ROI for your company blog. The first step is to calculate your investment.

Content Marketing Investment

The largest expense is labor costs. Let’s say you have 15 content writers, four editors, two designers, a social media coordinator, a head of content, and a head of SEO, all of whom work predominantly on producing and promoting content for your blog.

You pay your content writers a total of $70,000 per year, including salary, benefits, and equipment. Your editors make $95,000 per year, your designers make $80,000 per year, your social media coordinator makes $80,000 per year, and your head of content and head of SEO make $110,000 per year each. 

That’s roughly $1.9 million per year on labor costs alone, or roughly $157,500 per month.

But then there’s also promotion. Maybe you spend another $50,000 per month promoting your blog through ads. Maybe you also work with an agency on promotion, and they charge $10,000 per month. Plus another $5,000 per month for your content management system, and $15,000 per month for your content intelligence software. 

Combined, you’re looking at an Investment of $237,500 per month on your company blog.

Now you need to figure out the return.

Content Marketing Return

Calculating content marketing Return requires understanding which actions lead to sales. Let’s say your blog averages 1.5 million pageviews per month. 

If you consider the industry average conversion rate from pageview to lead is 2.35% via organic search, that means you’re generating 32,250 leads per month.

Your sales team’s conversion rate from a lead is 2%. That means your blog generates 705 new sales every month.

The average selling price for your product is $6,750, and your average profit margin is 10%. To find how much each customer is worth to your business, multiply your profit margin by your average selling price. In this case, the average customer is worth $1,200 ($20,000 x 12%).

If your blog generates 705 new customers a month, that means it creates $475,875 per month on average in net revenue. That’s the Return.

To calculate the ROI, you’d then subtract the investment in your blog from the Return, and divide that number by the investment. 

Your ROI for your blog is 100.4%.

Not bad.

Keep in mind that this example applies more to a B2B business, where there’s lots of visibility into each sale. With B2C companies, it can be more difficult to determine ROI, because the customer journey isn’t always clear. 

For a B2C business, you may need to survey your customers to find out how many are reading your blog, and if the blog readers have a higher average selling price than the non-blog readers. You’d then figure out the average selling price of the blog-reading customers, and divide that by your profit margin to find the Return.

Once you have the ROI for every content channel, add them all together and divide by the number of content channels, you can determine the overall ROI of your content marketing efforts.

For example, if your blog has a 58% ROI, your podcast has a 34% ROI, and your webinar series has a 15% ROI, your overall ROI would be 35.6%.

Use Our Content Marketing ROI Calculator to Streamline the Process

If that example seemed like a lot of work, we’ve also visualized the content marketing ROI process. 

Note that in order to calculator content marketing ROI, you need to have the following information on hand: Your monthly headcount, media, tech, and external labor costs (i.e. freelancers, agencies), your monthly blog traffic, your traffic to lead conversion rate (or you can use the industry average rate of 2.35%, your lead to sale rate, your average selling price, and your company profit margin.

The template we've provided can work for any content marketing ROI calculation. Just punch in your business's numbers and see your results.

Supplement Your Content Marketing ROI Calculator With Knotch

Knotch can help increase content marketing ROI.

Our content analytics product, Knotch Measurement, collects content performance data independently and transparently, pairing it in real-time with customer sentiment data. This gives you a complete view of your content performance as well as qualitative data that informs how customers perceive the value, impact, and relevance of your content and their feelings about your brand. 

This information allows you to improve your content to maximize pageviews, engagement, sentiment, and other metrics that roll up into your Return. This insight helps leading brands increase conversion rates and leads by creating more targeted content, while simultaneously lowering cost per acquisition and cost per lead.

To learn more, sign up for a free content marketing demo of our platform.