Experienced marketers keep an eye on both ROI and ROAS (Return on Ad spend) when monitoring marketing effectiveness.
ROI measures how your expenditure contributes to your company’s bottom line. As the name suggests, the metric evaluates the return on marketing spend relative to their cost. Put simply, it’s the ratio between revenue and spends.
ROAS is a proven metric that measures how much revenue your business earns for every dollar spent on advertising. You can express it as a percentage or a multiple, or a ratio.
Unlike ROI, ROAS gives a marketer a real-time view of revenue return from a specific advertising or marketing campaign.
It’s not as high level as ROI, not as granular as CPC or CTR. It gives you a holistic view of one more bunch of campaigns.
Why monitor ROAS by location?
For B2C businesses that have retail stores with different SKUs, customer mixes, and buying patterns, it's imperative to run campaigns specific to locations.
For B2B businesses whose sales operations are divided by regions - this could be states, cities, or zones for a national business or separate country markets for an MNC business. It’s again standard operative practice to run region or country-specific campaigns tailored to the specific market.
ROAS then becomes very useful for tracking the return from geo-specific campaigns and fine-tune budgets on the fly.
There are 3 ways to increase ROAS:
- Increase revenue while reducing cost.
- Increase revenue while keeping the cost same.
- Lower Ad cost while maintaining revenue.
ROAS can be boosted with better ad placement, keyword refinement, and sharper audience targeting. Campaign Managers can also focus on local location-specific SEO on landing pages and websites.
The right account structure for multi-location ROAS
Some key things marketers need to track across locations are:
- Which locations are performing well or poorly? Where to add or reduce budgets?
- What keywords and audience segments are working in each location?
- So what account structure works best?
1a) One Account. Campaigns Segmented by Location
This is the most favored approach by most digital marketers.
It allows you to customize keywords, copy, and calls to action (phone nos) by location.
Campaign setups can be simplified by using a template and tools like Ad Editor. You will also end up simplifying weekly management and reporting.
This approach allows you to track ROAS per location. You can boost spend in a location that’s doing well and cut back or fine-tune in a location that’s not performing as well.
If the product range is vast, leading to too many campaigns, you can group similar locations so you have fewer campaigns per product category. You can also create ad groups for broad product categories. Split products out into separate groups. Use exclusions for ads that don't fit into certain groups.
1b) Multiple Accounts. And location-based campaigns
If your business units are structured with separate budgets per location, you may prefer individual Adwords accounts per location. Management may be challenging. Landing pages may also load slower with multiple location campaign codes, affecting conversion.
The Arena Calibrate Dashboard Advantage
A highly visual dashboard like Arena Calibrate is helping several large business track performance across locations on one screen. Clients are able to see account level ROAS and week-on-week trend numbers. Our ML features allow marketers to save time doing manual optimization and drive results in lesser time.
With our BI support at hand, we have also helped with custom features like tracking leads by location and mapping attribution from lead to conversion.
ROAS, along with key metrics, helps Marketers/Account Managers optimize digital marketing campaigns across locations. With the right dashboard and BI support, you can streamline your digital marketing and take it to greater heights.
Test drive the Arena Calibrate dashboard FREE for a whole month and see how easy it is to track and optimize multi-location ROAS and other KPIs. Sign up, connect your data in a few clicks, and view your reports instantly.