Marketing is the first step in the sales process. Sales conversions typically now take more time, making Return On Objective (ROO) a more realistic standard on which to weigh your efforts versus the common form of using Return On Investment (ROI).

Return On Objective (ROO): a flexible approach based on a specific set of objectives.
Return On Investment (ROI): measures sales made before and after an investment.

ROO versus ROI:

  • ROO is a better measurement, as it relates to defining long-term objectives – increasing top-of-mind awareness, establishing expertise/reputation, strengthening customer loyalty, building market share, etc. – and then tracking results.
  • ROI is a short-term measurement concept, as it correlates directly to a monetary value – using sales promotions, turning over inventory, tracking sales/returns frequency, etc. – and doesn’t monitor customer loyalty or how it is taking longer for consumers to travel through the sales funnel.
  • Buying behaviors continue to change and the market is growing more complex as new channels and technologies emerge.

Benefits of ROO:

  • ROO is objective rather than sales based, so you can target any goal and adapt accordingly.
  • ROO enables teams to prove campaign impact when it’s not feasible to tie them directly to sales.
  • ROO encourages you to take a look at the effectiveness of your marketing methods, so you’ll know what’s working, even if sales don’t spike instantly.

Measuring Results with ROO:

  • Improved business and customer awareness.
  • Increased market share.
  • Better engagement with online channels and social media.

Emphasizing ROO measurement is integral in achieving long-term marketing success. Implementing programs with objectives helps take customers through the purchase decision – the ultimate goal.

Source:  Business2Community, reported by Joshua Breyfogle; ScreenCloud; AudienceMetrix;
Empower MediaMarketing;; Henry Wurst Incorporated, reported by Joe Contrino