Marketers know the importance of ROI (return on investment) and ROAS. Both are vital metrics that help you to understand how well your marketing efforts are paying off.
A common way to measure ROI is to divide the returns by the cost of investment and multiply by 100. This indicates the gain or loss from an investment when compared to the cost.
ROAS is a similar metric, but is normally used for paid campaigns where you can divide the revenue generated from a specific campaign with the cost of running that campaign. This is usually in the form of advertising spend. ROAS does not factor in expenses due to other marketing or production expenses, such as generating creative or setting up the campaigns.
In this way, ROI can indicate the performance of an overall strategy, and ROAS can measure the efficacy of specific tactics. For an overall picture, marketers should use both.
There are two key components that make measurement possible, attribution and identifiers.
Attribution refers to finding out which marketing touchpoints convert the most customers. The right model helps to optimize spending across channels.
Identifiers refer to ways of identifying customers online, a cookie is an example of an identifier. The use of blockchain on Web 3.0 means that users have control over their data. They decide who to share it with, and no longer can be people be unknowingly tracked across the internet with cookies.
To measure profitability measures like ROI and ROAS, marketers need to accurately attribute users to sources and identify users across platforms where they may see an ad through to where they might purchase.
There are many tools that help to measure profitability by tracking attribution and identity in Web 2.0. There is Segment, which collects data from the web and mobile apps. It identifies customer touchpoints across channels for a complete picture.
There is also Appsflyer, an attribution platform. It maps customer journeys to optimise campaign management. Other platforms, such as Google and Facebook, offer tools that are engineered for paid media.
Also read, Mastering marketing in a web3 world | A complete guide
In the fast-growing world of Web3, measuring ROI and ROAS needs a different approach. The decentralized nature of the medium means that special attention has to be paid to attribution as well as identifiers.
Marketers need to go beyond these traditional methods. In Web 3.0, they need new ways to track consumer journeys.
For example, a user may watch a Twitter AMA, then visit the brand’s Discord server, and finally, make a transaction via a Metamask cryptocurrency wallet. That means getting reliable identification means connecting data across three different identifiers.
There are challenges with revenue tracking, too. In Web 3.0, transactions occur through blockchain and not traditional payment gateways, denominated in a traditional currency.
Fortunately, new enterprise platforms can join all the dots. They can help marketers gather and connect personal information with tactics such as loyalty points. They can then resolve identifiers across platforms, and help you with web3 attribution and measurement.
Blaze is one such Web3 growth tool. It makes quantifying organic marketing ROI simpler. It connects your community and on-chain data for seamless consumer journey mapping. To find out more, schedule a demo today. You can sign up to Blaze here.
