Content Marketing vs Native advertising and How to calculate ROI

Posted on Posted in Content Marketing, Goals, Native Advertising, ROI

Today we are going to talk a little about what content marketing, native advertising and how to calculate the ROI to get the maximum benefit from our capital. So, let’s start.

What is content marketing?
Marketing_Contenidos
vía Pixabay Stux

As you may have figured out by its name, content marketing is a marketing technique based on creating and distributing relevant and valuable content with the goal to attract, acquire and gain a very specific target audience’s attention, to motivate them to become future clients.

This technique is currently one of the most popular ones in online marketing, and you may have probably seen it in hundreds of articles lately, but it’s not something that was invented recently. Joe Pulizzi started talking about this technique over 12 years ago and, despite all the advances in campaigns, means, tools, and others we currently use, his definition hasn’t changed at all.

He also has phrases to describe it, like “Content is King” or Content is love,” but it’s important to understand that content marketing isn’t only based on creating content like most users think, since creating content is not precisely marketing.

  • What’s the goal of content marketing?

Attracting and retaining clients through relevant and valuable content to then achieve conversions with them.

  • What are the challenges of content marketing?

Producing enough content

Producing good content

Obtaining budget

Having varied content

We can normally see that this technique is applied in social media replacing conventional content with graphic content, which captures the visitors’ interest more easily. This has the potential to increase the number of followers of which a percentage will become clients. In blogs’ case, it’s increasingly common to see that they give prospects a free incentive; one of quality, to awaken their interest, such as an e-book, infographic, template, or white paper; to which you must follow up on to turn them into clients.

 

What is native advertising?
Publicidad_Contenido
vía Pixabay OpenClipart-Vectors

Unlike traditional invasive or aggressive advertising with banners, native advertising is based on showing offers in a natural way to the consumer in a not so intrusive way to offer them a product or information that is relevant based on their interests or behavior.

This marketing technique has the characteristic of not driving the possible client out of their behavior flow, which notably improves the user’s browsing experience and helps us win the user’s trust and interest. With this, we’ll manage to increase conversions.

  • What’s the base of native advertising?

Native advertising is based on creating content; it must work in spaces that can be provided for it, like blogs and social media, for it to develop.

Unlike content advertising, which is based on its own means, native marketing is based on paying for the space in other people’s means.

Native advertising manages to disguise itself as reports, interviews, and articles, with the goal of gaining the visitors’ trust; a trust which was lost thanks to traditional marketing. Keep in mind that, despite it being similar to the website’s content, you must always warn the consuming user that it is actually sponsored content. Likewise, you must keep in mind that you must always offer valuable content to the user; so you must apply this to sponsored content.

  • What characterizes native advertising?

What’s interesting about this technique is its most important feature, putting itself in the consumer’s or user’s place (getting in the consumer’s shoes), always granting relevant information and showing offers that really are of interest to the consumer, or providing information that they would really like to receive.

 

Content Marketing vs Native Advertising
Content Marketing vs Native Advertising
vía Pixabay Geralt

Many people consider that both terms mean the same, only with a different name, but this is a mistake and we must be clear about the differences between both in order to know the world of online marketing in detail without confusions.

The main difference between native advertising and content marketing is that content marketing is a full or global strategy, and native advertising is one of the tactics that you can execute within your content marketing strategy.

The second difference is that content marketing is the message and native advertising is the wrapping in which that message is delivered. For example, you can imagine a pizza in its box, the pizza would be content marketing, and the box would be native advertising (now I’m hungry, hehe).

  • Content marketing:

Global strategy

Message

Adds value

  • Native advertising:

A tactic within the strategy

Wrapping

Generates sales

With everything mentioned here, content marketing and native advertising are terms with different meanings that are much related to each other.

 

What is ROI?
Return on investment
vía Pixabay Stevepb

To be able to determine the success of any project performed by a company (of any type or size), it’s necessary to analyze the obtained data, such as conversions amount, and the amount invested in getting to obtain those conversions. This is to determine if the project was a success or not. With this in mind, we can define the ROI (Return on Investment) as the economic value generated as a result of performing different activities related to marketing. This data will help us measure the return obtained from an investment or campaign.

To be able to determine a real ROI, it’s mandatory that each action is planned to determine the obtained revenue in every action or ad and, this way, being able to compare them to the amount invested in each one. ROI allows you to know the return ratio of your investment, in other words, with ROI, we can evaluate how much of each dollar invested in a campaign was sales revenue. The more profitable the ROI is, the more profitable the campaigns or performed actions will be.

You must know which are the elements or indicators that are vital to your evaluation and this way you’ll be able to apply them in different campaigns, regardless of their characteristics. These indicators will serve as a base or guideline to initiate the measurement plan which will lead you to determine your investment’s ROI, thus being able to clearly see your campaigns’ performance.

  • How do we measure ROI?

ROI’s formula is as follows

ROI = (obtained revenue – investment) / investment

As you’ll see, you must have specific elements defined to be able to calculate a campaign or action’s ROI.

ROI is expressed in percentage (%). If you wish to obtain the profits percentage of your investment, you must multiply the ROI times 100.

Example:

ROI = (5000 – 2000) / 2000 = 1.5 * 100 = 150%

Now, what’s important; which is the most important? What are the differences?

We’ve already seen what each one of these consists of. Generally, one is delivered to the user in friction since the sale is not being enforced and the other can be utilized in a more assertive way since they’re incurring in the sale since the start. It’s also possible to be a little flexible in native advertising and, instead of offering a paid product, a smaller version of our product could be offered for free.

This way, we could achieve that the new audience we’re reaching gets to know us and then, step by step, we must work towards the development of trust, authority, and respect from the user to us. In this point, you may freely test what’s the best way of selling to our user, obtaining greater results than if we opt to get to the sale from the start.

 

Benefits of knowing a project’s ROI
Beneficios ROI
vía Pixabay Geralt

In today’s world, thanks to technology, we can get to our clients in multiple ways, whether it is via free advertising or paid advertising.

Regardless of which one you’re using, it’s critical to know which is giving you the best results for the smaller cost. This is called Return on Investment or R.O.I.

On the other hand, one of the benefits of knowing our marketing campaign’s ROI is knowing if the resources we’re using, whether internal or external, are showing the expected results or are exceeding the expectations we posed in the beginning.

 

Which data do I need to calculate ROI
ROI DATA
vía Pixabay PublicDomainPictures

To be able to calculate ROI, first of all, the elements that participate in the formula must be quantitative.

Said elements are such as investment’s profit and cost of investment. Having the former quantified, we can proceed to calculate which has been our marketing campaign’s ROI. We must remember that a non-paid campaign’s ROI can also be calculated since many people think that only those paid campaigns would benefit by having the knowledge of their ROI.

Let’s remember that the formula to calculate ROI is as follows:

ROI = Investment’s profit – Cost of investment / Investment’s profit

Once the goal of our campaign has been established, the KPIs must be established, which are our business’ Key Performance Indicators. These must take each phase of the audience as a whole, whether as prospects, leads, opportunities and, finally, sales.

 

Tools to facilitate ROI calculation 
ROI Tools
vía Pixabay PublicDomainPictures

RJ Metrics’ Cloud BI.

It’s a tool that calculates the Customer Lifetime Value, or CLV. Actually, not only does it calculate the CLV, but it also details in a segmented way which social media channel sent that determined customer to your website, incredible.

Cyfe

It’s a tool that details how campaigns are being shared among social media and measures the impact these have in the ROI. It comes with a really high customization level since it allows, through widgets, the customization of report boards to visualize the information in a specific way according to which social media channel you wish to explore more in-depth.

Google Analytics

We couldn’t forget our good friend Google Analytics. It’s a tool developed by Google, free to use. It comes with a wide documentation and, as a matter of fact, Google’s people have courses associated with this tool. With it, you can know everything about your audience.

For example:

  • How many visits our website gets in real time.
  • How many visits we got yesterday, one week ago, one month ago; whatever you want to find out, just enter the time range and you’re good to go.
  • Which were the references from other websites that sent the visitor to your website, this way you’ll be able to optimize your efforts on those
  • From which country your audience came from. This is of critical importance if your product can be sold on a global level, this way you might be able to know in which countries you’re getting the best ROI.
  • How much time each visitor spends on your site could help you figure out if your content is relevant to your audience. With this, you could improve your content strategy or also get more knowledge on which audience you’re targeting.

All of this and more can be done within this very intuitive tool.

 

Conclusion

Bringing everything we’ve seen, whether we’re implementing a marketing strategy, utilizing content marketing or native advertising, one way or the other, we must be aware of our campaign’s ROI. This will save us a few headaches when we see that something’s not working, and we don’t know why and, even when the campaign is giving good results, which would be worse because we won’t know the reason for its small success and we won’t be able to escalate it eliminating what didn’t work and keeping what’s giving us results.

PS: Has anyone gone through this moment in their beginnings when they were learning everything at the same time? Tell us your story!