As the use of personalization and digital communication has increased in marketing over the past decade, the ability for community colleges to track marketing return on investment (ROI) has also grown.
With the splintering of communication channels to allow for niche communication with thousands of audience groups, it is not just important but crucial to know which strategies yield enrollment and which do not. This knowledge is the key to making informed decisions and maximizing the effectiveness of marketing efforts.
Understanding the terms
ROI is one of the strongest key performance indicators (KPI) in marketing. Marketing ROI is calculated by the revenue generated minus the cost of advertising investment, and dividing that amount by the cost of advertising investment, according to the Harvard Business Review. It is a simple formula that can be hard to implement.
Measuring ROI provides valuable insight into determining effective marketing channels, the amount to invest in marketing budgets and tactical campaign success, according to Marketing Evolution, a company that helps business gather, understand and use their marketing data. The same article quotes a 500% return on investment as a successful return and a 1,000% return as an exceptional one.
This article is part of a monthly series provided by the National Council for Marketing & Public Relations (NCMPR), an affiliated council of the American Association of Community Colleges.
Measuring marketing ROI can yield powerful results, and it is not without challenges. The complexity of marketing, with its myriad of factors that impact campaign sales versus organic sales, can make it difficult to gain a true sense of the return. In marketing, there’s often no direct relationship between marketing messages and enrollment. Multiple messages, both paid and organic, can influence students’ choices. Moreover, community colleges have numerous touchpoints throughout the selection and enrollment process. These complexities underscore the need for a comprehensive approach to measuring marketing ROI.
When used as one of several KPIs, ROI creates a meaningful way to evaluate vendors, tactics and campaigns. It is important to establish clear goals, determine costs and leverage marketing analytics platforms. It is also important that any marketing vendors can deliver campaigns that support growth and measurement objectives.
ROI in action
At Kansas City Kansas Community College (KCKCC), the team has focused on identifying student data that can be tracked through digital advertising and the application-to-enrollment process. Email and physical addresses are two key pieces of information that KCKCC has used to track individuals. Using both identifiers, the digital advertising vendor and KCKCC can determine who interacted with digital advertising and what actions were taken.
The digital advertising ROI for KCKCC’s fall semester was 11 times the cost of the advertising investment. By identifying these students in the system as digital marketing leads, the team could look at fall-to-spring retention and, next year, evaluate fall-to-fall retention.
There are four key steps KCKCC uses to track ROI for college digital advertising:
- Decide what information allows the team to best track students. Most digital advertising at KCKCC is built by geofencing physical addresses. This work has increased now that third-party cookies are much less effective. Depending on the information students share with the college, phone number or email address may also work.
- Define terms. It is important to understand what is considered a new, returning or stop-out student. Another factor is how to define revenue value. KCKCC’s marketing team uses in-county tuition multiplied by total credit hours for the semester to generate the gross revenue number. It is more important to compare the same number consistently than get bogged down about which number to use.
- Analyze. Researchers can match records using institutional enrollment reports and campaign reports to determine the number of students who interacted with the advertising and enrolled. From there, the student’s credit hours can be translated into tuition revenue. The college’s advertising partner can also track the campaign, giving the team insight into which campaigns yielded the most enrolled credit hours.
- Report. Return on investment is a KPI for effectiveness. In practice, many internal and external factors influence a student’s enrollment. This data analysis looks for campaigns and tactics that resonate more strongly with prospective students.
Marketing ROI is often bandied around as jargon without a way to engage in meaningful discussion. When an ROI model is built for marketing campaigns, then the team can redefine effective marketing and see a yield increase. Models take time and collaboration to build. Taking one step today toward a model can create transformation in the months to come.
