In the financial world, ROI simply means Return On Investment. ROI is the most commonly used method that business organizations use to determine the feasibility of a particular investment opportunity presented to them. It basically means the possible annual return of money invested on a business deal or a project. ROI is very much similar to the calculations that are used on a bank account’s interest rate and on most stock investment profits. ROI is quite easy to understand, and this must be the reason why a lot of people feel comfortable in using it as a model for computing their possible earnings.
As implied earlier, ROI is a very straightforward tool used in measuring the financial return of a business project. It is calculated by getting the number of times the net benefits had gained, minus all the costs involved, as compared to price of the initial investment. This is the most common mathematical definition of an ROI, although a number of other formulas had emerged over time. And this is mainly due to the fact that every business has unique financial inclinations and has different factors to consider. The computation for ROI can be tailored in such as way it answers what a certain industry or company requires.
There are several key points that have to be understood so that ROI can be fully explained. These are:
1. Net Profit. Net profit corresponds to the project’s total profits less all the costs that are associated to generate the said profits or benefits. Net profit is oftentimes referred to as net costs. For some companies, it is important to include taxes, depreciation value, and other similar things to the computation of net profits. On the other hand, some don’t opt to include them because of their ever-changing values that could only affect the computation in a negative manner. This is an example of tailor-fitting the computation of ROI for every business. Net profit is actually the projected income from a business endeavor. From it, ROI can then be computed.
2. Total Costs. Costs are another factor. Costs are actually the denominator of an ROI equation. If net profits are the numerator, then its value has to be divided by the costs accrued by the investment to arrive at an accurate ROI value. Again, computing for the total cost is subject to the requirements of the company. Some do it by considering only the capital expenditures within the first year, while others include all periodic or recurring costs. Examples of recurring costs are maintenance requirements and sometimes, even software and hardware upgrades.
3. Period. Period corresponds to time. Arriving at an ROI value has to be quantified as to how long the return is supposed to be achieved. Is the return expected to arrive on a yearly basis? Or is it going to be quarterly? The most common model used by companies is of course, the yearly computation. But a lot also consider short-term projects in order for them to better envision the yields a certain investment may bring. There are cases though, that big-ticket projects require more than a year for an ROI to be realized. And to answer this, a specific model has to be formulated to determine the ROI’s accurate value.
4. The Differences in Terminology. While the computation for ROI is generally the same, in some cases, the equation is modified and the terms used are quite different than what it is more commonly known. Net profits, or net benefits, for example, can be termed as the investment package’s future income or simply its projected earnings. Some other financial experts, on the other hand, may interpret these costs as invested assets and capitals. Either the case, the value of ROI remains the same. And that’s because the value used remains the identical, regardless of the accepted change in the way the terms are called.
With all these said, ROI or return on investment could be applied in all types of business, no matter how big or small it is. In fact, it is actually used as a basis of business owners to determine whether or not they should continue on investing their time and money on a certain project. Loaning institutions uses the ROI model to estimate their profits they would gain on financing another person’s or a company’s monetary requirement. And on a small business’s point of view, the computation for ROI can be used in analyzing whether buying goods for inventory purposes will give them an income in the form of sales in the next year.
Nowadays, ROI is also widely utilized in online marketing. In fact, the ROI rule is best applied on pay per click advertising that most website owners integrate in their respective websites to make them more profitable. Some webmasters adapt the ROI model in deciding whether or not they should participate in such types of advertising strategy to promote their online stores.
And so it is a must for every businessperson to determine a project’s ROI before they involve themselves in it. This ensures them of a smooth business operation, with the end goal of generating income from it. If ROI is not rightfully considered, the whole business deal becomes a risk, and it could very well be big risk at that. It also pays to know the need or the frequency by which you need to recalculate and work something out to protect the project’s projected ROI.
Business deals can really be tricky. You could be well gaining on one second and failing on the next. In relation to the risks associated to your chosen business endeavor, you should regularly check how your ROI is coming to be. Remember, the values of ROI are not always fixed. It may change from time to time, depending upon the factors that directly affect the business deal. The more important thing here is that, as a businessman, you should be well aware of the risks and the gains associated to a particular investment you are looking at. And by weighing the gains against the risks, you will get an estimated ROI value, which in turn, could help you decide whether you should push through with the deal or not.
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Developing a marketing strategy with your customers as the main focus is a good move to attain better sales figures and market performance. Undoubtedly, the consumers are the force that can turn your business around, either into a big success or a sorry failure. To penetrate your target market in the right way, it is always best to first consider who really your consumers are.
Before the companies had seen the need to move to go consumer-oriented, marketing activities were developed solely to advertise a product, generate some sales, and build market shares, regardless whether such marketing activities formulated cater to what the consumers really need or not. Since the challenge to do everything for the favor of the consumers, all marketing strategies that are implemented are guided by the lone goal of selling several pieces of merchandise purely for the sake of the business.
But times had evolved and new strategies are implemented. Today, consumer-oriented marketing is fast becoming popular. And what it really implies is the development of marketing tools and systems that for one, provides for stores and distribution channel examinations. These tests are conducted so as to evaluate a particular store’s suitability to carry a particular product.
Consumer-oriented marketing also requires businesses to check the pricing of their product or service, whether or not it is fitting to their general consumers. Doing so prevents businesses to overprice or under price the commodity they are offering, while giving the best value to the patronizing public.
But most importantly, the need to develop consumer-oriented marketing strategies causes businesses to specifically pinpoint the very people who need, use, and buy their product directly. And once they have a good idea as to who the main market movers of their products or service are, they can start to assess their exact needs, aspirations, and wants. Accordingly, they can attend to those things accordingly. This precisely is the main idea behind developing a consumer marketing strategy. To specifically develop a consumer marketing strategy, here are good steps to consider and queries to answer:
For you to start developing a marketing strategy targeted to your rightful consumers, it is best that you accurately group your customers into their specific categories. Are most of your consumers branding conscious? Do they consider price over other factors? Do they buy your products to primarily gain its benefits? There are a lot of other buying factors your consumers may have. Try to analyze all of them to ensure that what you are offering answers specifically to their motivations for buying.
The moment you know the specific segments of your market are, the next thing you have to do is to check which of them are going to give you more business. You can then start prioritizing the actual people belonging in that category when developing your marketing strategy. The three good points to consider in determining whether or not the segment is profitable are its size, its congestion, and the group’s purchasing power. The larger the market it, the more people can buy your product. The fewer competitors you have on that market, the better your performance will be. And lastly, the ability of people within the group to buy or avail of your product determines your actual profitability.
After the segment is identified and analyzed according to profitability, the next and probably, the last thing you have to know are the attitude and the individual characteristics of the people under each category. If you know whom you are selling to, then serving their needs becomes a lot easier. And to attain that, an in depth marketing research is required. Doing so allows you to create accurate tools and systems to help you attend to your customers’ desires. And if you can serve your customers in the specific way they want you to, your business will surely thrive for several years, if not decades, to come. Don’t forget to take into consideration your customer’s habits, values, and all other factors that influence their decisions. If you know all of about these, they you can estimate the longevity of the segment or if it is likely to shrink in the future. And of course, with these data at hand, you can create strategies that can work around the individual needs of these customers. Immediate and future campaigns can be then planned well so that it can create better impact to the segment.
The last step in developing a consumer marketing strategy is reviewing your customer’s feedback towards your product. You have to check whether or not you are successful in providing accurate solutions to your customer’s individual needs by asking about their views, feelings, and thoughts first hand. If the results are not good, then you have to try in modifying your system, strategy, or even your actual product or service to make it the perfect things your consumers need. Developing a customer-oriented marketing strategy is actually a cycle. The whole thing needs to be repeated over and over until all points are perfected so as to make all consumers happy after purchasing your product or availing of your service.
Developing a customer-oriented marketing strategy is actually a step in tailor-fitting your product or your service for all your end users. From a certain viewpoint, it seems that it is the consumers that get the better end of the deal. But actually, that is not necessarily the case. If you are successful in molding your products to make it more apt for your consumers, then true enough, each of them would be happy with their purchase. But in the long run, it will benefit your business more. While fulfilling the specific needs of your under served consumers, you are also inculcating supreme value with them. And possibly, it will be a start of a long-term relationship. Along with these, tremendous growth opportunities will certainly open up for your business.
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 Reader engagement with blogs has changed dramatically over the last three years, primarily because of the rise of online social networks, according to new numbers released by analytics firm Postrank today. Postrank published an analysis based on metrics for signals like comments, trackbacks, shared links and online bookmarks for the top 1000 most-engaging feeds online and for 100,000 randomly selected blog posts in each year since 2007.
The numbers paint a stark picture: blogging has changed, but the blogging scene is in some ways in better shape than it was three years ago.
The big picture is that total engagement with online content is growing while on-site engagement is declining in significance as off-site engagement like link sharing on social networks grows. Surprisingly, this off-site link sharing has also extended the lifespan of content. Highlights from the report include the following: - Total reader engagement has grown 30% year over year or 69% total for the top 1,000 feeds, which includes blogs and mainstream news sites.
For 100,000 randomly selected blog posts in each of 2007, 2008 and 2009... - Engagement on-site has grown in absolute terms but the share of total engagment that happens on-site vs. off-site has dropped 50%.
- Trackbacks have fallen from 19% of engagement to 3% of engagement.
- Engagement on social networks like but not limited to Twitter, FriendFeed and Facebook has grown from 1% to over 29% of total engagement. The Postrank staff admitted that this was a surprisingly low number but said that in aggregate there is still a whole lot of activity going on outside social networks.
 - Segmenting from the last amount of effort required up to the most, reader engagement now looks like this: 29% is link-sharing on social networks, 29% is bookmarking or voting on sites like Delicious, Digg and Reddit, 38.5% is comments on or off-site and trackbacks are now 3% of engagement. "Trackbacks are taking a nose dive," Postrank CTO Ilya Grigorik told us by phone, "bookmarking sites have consistently gone down over the last 3 years, but voting on sites like Digg or Reddit has grown."
- Perhaps most significantly, blog posts now have a longer life span. In 2007 tracked posts saw 94% of engagement within the first day and 98% of that first day's engagement happened within the first hour. In 2008 that number fell to 83% within the first day and in 2009 it was a mere 64%. Thus Postrank concludes that 36% of reader engagement in the top blogs happens after 1 day. "While the real-time web is all about lowering the latency," Grigorik says, "the pervasive nature and number of people engaged in their communities and conversations (the Social Web) is helping with information discovery. People are worried that the real-time web will destroy their readership as everyone just gets distracted by the newest shiny thing on Twitter, but the numbers show something very different. It's so easy to spread information now that it lasts longer and finds more niches - this trend is helping content travel further."
Post reblogged from ReadWriteWeb.com 6AESPFGUH6Y9
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When deciding whether to incorporate Adsense into your blog there are several factors to consider. Many feel that it diminishes their brand, whilst others see it as a useful tool for visitors which creates revenues and makes their content profitable.
The choice can largely come down to the commercial goals and the purpose of your blog. Many businesses who sell products decide to place Adsense adverts within their blog. This would appear to be a strange choice, opening up opportunities for rivals to promote their service or product to your potential customer base.
Many publishers claim that they are only doing this to allow companies who provide ancillary services to advertise. These claims have some merit, as those who for example sell pillows could provide those who sell bedding with an opportunity to advertise.
Although this would make sense, there are still those online retailers who allow rivals to penetrate their audience. Many claim that there are still benefits in allowing your direct competitors to advertise within your blog. One of these is that ultimately if visitors wish to see your competitors they would be able to see them through a Google search regardless. This may be true however the thought of an established brand like coco-cola having a Pepsi advert in their blog is not even a possibility.
Another factor which is considered in this situation is that publishers do not feel that Adsense is effective in making conversions. They feel that visitors who would click on adverts are not highly qualified customers, as they would quickly navigate to the materials or products that interest them if they were.
Despite Adsense being a questionable choice for online retailers, it is surely a good supplementary service for other varieties of online publishers. For example, a blog which provides a free service like dictionary.com gets high levels of traffic, and is able to make their service profitable through adsense. This has been the case for Bloggers who originally provided content free of charge, being unable to reach the scale that is necessary to contract with advertisers directly.
This could also apply to other previously free services, including wider forms of information broadcast, and news for example. In 2006 a man who later published a selection of Videos claims to make $19,000 a month through adsense, claiming that he was also contacted through Google to help him increase the CTR (Click Through Rate) that he achieved. The thought of success like this has been a major factor in stimulating online publishers to opt for Adsense.
Many publishers also claim that adsense makes their blog look more professional. Those who are able to contract with advertisers are generally seen to provide a service with large appeal, and therefore those unfamiliar with the program may feel that the Adsense advertiser is in this position.
Adsense however, is also aligned with those publishers who use the service purely to provide links to adverts. Everyone has done a Google search, clicked on an Adwords advert and came into a blog which reads top ten resources on… This is a major problem, as is generally something that surfers find frustrating. If people see that it says adverts by Google, and they then see adverts by Google on another site, they may align that site with consumer unfriendly practices. This is therefore an issue which Google has to address, to maintain Adsense as a reputable service.
Regardless of the disadvantages and the blogs for which the service may be inappropriate it is still a useful tool for blog visitors. Those who visit a blog, and click on a link provide revenues for the publisher, whilst those who provide free services are able to generate revenue.
The only fear that Google has, is that rival PPC programs offer better deals to publishers and they decide to go elsewhere, therefore taking advertisers with them. However, ultimately it is best for advertisers and publishers if they largely remain in same PPC circuit.
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Business and Image
In order to establish a strong business brand, you also need to create a strong business image. This will be used by potential customers or consumers to assess their own expectations about the company. There is a crucial moment in every marketing strategy that is aimed at attracting the customers' attention about your product and you achieve this through your company image and brand, which is also why it is of extreme importance.
More than any type of impression, you want to create a positive image on your customers. This will help ensure that you are among the top of their list when considering buying a product similar to yours. This is just the initial phase and eventually the confidence of your customers on your brand will soon come into play.
Creating a Professional Logo
In the world of business, the logo represents who you are as a business. Hence, it should be able to capture and reflect the nature of your business at its most basic level. Identity and reputation should be followed thereafter.
As a reflection of your company, your objective is to design a logo with a professional touch because it is what creates the initial impression on the mid of the consumers. These first impressions are almost always impossible to undo, so you cannot risk coming up with a mediocre design. If you are unsure how to execute a design, it is always best to hire a professional to do it for you. This will help you attain a more consistent design for your logo that reinforces the message that your company is trying to convey. In fact, most businesses (big or small) allot an investment for this and you should as well.
As simple as it may sound, designing a logo is an intricate process, which is why you need a professional help realize your vision and visualize your business concepts. Among the elements that must be considered and combined effectively are colors, shapes, light, space, and so much more. Make sure to include this in your brand planning process.
Business Input Into The Design
Although you leave the designing job to the hands of a professional logo designer, this does not mean that you (the business owner) is eliminated from the formula. This is your business and it is your vision, therefore it is the most essential element in the logo creation process.
The process involves you gathering information and producing creative ideas that will be utilized by the designer in coming up with the design. Hence, careful planning and brainstorming of ideas is an essential step to take before jumping into the actual design process. You two must work in a symbiotic manner – you can share your business input to the designer for them to translate a graphic representation of your ideas, while they can propose designing elements that will jive with your business identity.
Where To Get Creative Ideas?
When dealing with the technical aspect of marketing strategy, often the challenge is to produce creative ideas for your design. The key here is to stimulate your brain to arouse creative thoughts that will make your brand stand out and still maintain that professional image.
Here are great tips you can try to squeeze out those creative juices:
1.) Spend time reading to be able to get inspiration from various reading materials.
2.) Search the web and observe various sites you visit. Look at how the design are produced and what kind of reaction it elicited on you.
3.) Ask your employees or other staffs for ideas. You can turn a small idea and develop it into a valid design concept.
Image is such a vital element in the business brand, which is why it is your main objective to create a professional design that is going to last.
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