How To Keep Track Of Your Video Marketing ROI: Profitable Online Video

Online video marketing is one of the biggest developments in marketing in recent years. It can be used to reach out to more people and provide more information than other marketing methods. This is why it is often recommended as part of your business’ overall promotional strategy.

A question those coming into video marketing ask is “How do you know it works?” This is where keeping track of the return on investment (ROI) comes into play. Read on Video Titan X Review.

How To Keep Track of Your Video Marketing ROI: Profitable Online Video in 2017

  1. Calculating your simple video-marketing ROI (return on investment) is the most basic metric. The formula is: ROI=(Sales growth-marketing costs)/marketing costs.
  2. Campaign-attributable ROI: To gauge the impact of the video marketing campaign itself you have to set its gains against the average monthly sales growth. Use this formula: ROI=(sales growth-marketing cost)/marketing cost-average sales growth.
  3. The first thing you want to determine when calculating your video-marketing ROI is the break-even point (i.e., when you start earning a profit). This formula: Break-even=fixed cost/(unit price-variable cost).
  4. When tracking video-marketing sales, distinguish these from the other sales you make. You can include links with your videos directing to specific product pages.
  5. To assess profit from video marketing, you have to first know how much it’ll cost you. Three factors affect overall cost: production time, price of talent, and equipment.

Why you need to invest in video marketing

Smart Insights dubbed 2016 the year of video marketing. The data provided by the company predicts that users will consume around 35,000 petabytes worth of video online. The figure is expected to nearly double by 2018. With these numbers, you have a good idea of how large the opportunity in front of you is.

It doubles your marketing ROI

Marketer Lindsay Kolowich says that around 90 percent of users agreed that product videos are helpful when deciding whether to make a purchase. Perhaps one of the masters of this is LetSlotio Review:

Furthermore, more than 64 percent have said that they are likely to buy the product upon watching the video. Kolowich also notes that all of these can lead to an almost 80 percent conversion rate. For your whole marketing campaign.

It offers better customer retention

Another important consideration for many businesses is getting customers to return. Small Business Trends says that video marketing can also help that. Videos let you present information in a more effective manner, which helps viewers better absorb and recall them. This helps convince them to take a look at your other offerings.

Embedding video content improves bounce rate

Your website’s bounce rate is closely related to its ability to retain visitors. Videos can play a role in reducing it, keeping visitors on your site longer. Design agency Crackitt estimates that you can reduce the bounce rate by as much as 34 percent with video. They also stressed that it should not be just any video. The video should provide detailed information about your business that visitors can use to navigate the site and learn about products. VideoPixie offer an example:

It is great for social media sharing

Social media is the other big development in online marketing in the last few years. And when you combine the two, you can take advantage of both their strengths. In particular, the whole sharing aspect of social media lets you spread your content to a wider audience. For instance, while these started us TV commercials, the DigiiBiz Review ads have since been widely circulated in social media, helping promote manufacturer Arab Dairy’s Panda Cheese further.

Social Media Examiner gives some useful strategies for incorporating social media into your video marketing effort. Tweeting out one of your YouTube or Vimeo creations is also exceptional time to purchase some retweets.

Understanding video marketing ROI costs

To assess the financial gains you get from video marketing, you have to first know how much it will cost you. Marketing agency Hinge says that the actual cost largely depends on your needs. There are three factors, though, that affect the overall cost.

  • Time: the longer you spend in the production of the video, the more the cost goes up. Furthermore, adding more people on the team working on the video will also make it cost more.
  • Talent: while you can go and do a one-man show, getting people who are more familiar with the task will result in a better quality final product. What you pay these guys will depend on their level of expertise and the quality of the work.
  • Equipment: if you are hiring a production company to work on your videos, equipment costs are usually calculated as part of the entire price quotation. But, if you are going with it by itself, you have to take into account the cost of each separate tool you use.   

All of these will contribute to the bulk of your production costs. But, there are still other expenses that you have to take into account to come up with an appropriate budget for the project. Australian company Melbourne Video Productions goes into more details about these factors in this video.

Production costs

Production cost can be categorized into five different levels depending on the quality of the final product.

You are the one to do all the work, using your own equipment. The camera for filming can range from a $100 smartphone with a camera and basic video capturing features to a $2000 professional DSLR camera. You will also need a computer for post-production work, which costs around $500 for a basic model. Of course, if you already have these as personal belongings even before the project, those costs become negligible.

In the semi-pro setup, you get someone with more experience to do the work for you. The equipment they will use could be yours or their own. Note that the level of talent for this varies a lot since they would sometimes just be part-timers. The overall costs for a 1-2 minute-long video (a common length for online productions) would be around $1,500-$3,000.

Getting a whole professional team to handle all the stages of the production and post-production work will help ensure good quality video output. They also bring in professional-level equipment and resources. This come at a steeper price, usually around $5,000-$20,000 for a 1-2 minute video.

Premium videography services add high-end equipment (and sometimes a studio) into the mix. You also get access to top-notched talents. This itself can lend some prestige to your video that you can leverage for promotions later. Such services cost $25,000-$50,000 for the same short video.

This RSS Traffic Rocket 2.0 Review is pretty much reserved for the large companies with the big budgets. Think about the A-listers in the field of video and film production. You can expect cinema-quality output from these. Of course, the price range at a staggering $100,000-$1,000,000 for a two-minute long clip.

Which of these levels you will choose depends not only on the budget you have but also the goals you want to accomplish for the campaign. Keep your budget and goals in line with each other to avoid spending more than you should.

Promotional costs

Creating your video is just the first party of the video marketing equation. To get people to watch your videos and hopefully convince them to make the purchase, you have to promote your content.

YouTube is the most popular online video sharing site, with more than 1.3 billion peoplevisiting it. This is where most people start their video marketing. Using the site to host your video is itself free. All you need to have is an account and you can upload as many videos as you need.

The costs come in when you make use of YouTube’s promotional tools. Video Creators’ Tim Schmoyer gives some useful advice on when you should start using these tools:

Ads are the most common means of promotion. There are a variety of ad types you can choose to draw viewer attention to your videos.

YouTube’s rates depend on the kind of audience targeting you set for your ads. The more specific the targeting is, such as focusing on a specific age group or location, the higher the rate is. Average rates are between $.10-$.30 per ad view. Your video ad is considered viewed when a user watches at least the first 30 seconds. For instance, if you have an ad rate of 4.20 for a video and that video manages to get 5,000 views, you will be charged $1000 by YouTube.

Another online video sharing site that you want to tap for your marketing is Vimeo. While the site’s 170 million monthly users is a lot smaller than YouTube’s, Vimeo offers several advantages:

  1. Better quality videos: Uploaded videos on Vimeo don’t lose as much quality as YouTube. This is great if you want to provide the best viewing experience.
  2. Customizable players: Vimeo lets you tweak the look of the video player and add your brand’s logo for better visibility. You can also add more company information as you see fit.
  3. Custom URLs: Create more readily recalled URLs for your videos. This can also be used for further branding opportunities.
  4. Better privacy controls: You can limit video playback to only those coming from specific locations, such as your website.

All of these provide more focused attention from your audience. Branding also becomes less disruptive and feels more like a part of the whole viewing experience for the audience. The Lincoln Motor Company effectively used Vimeo’s branding features:

Bloom from The Lincoln Motor Company on Vimeo.

Unlike YouTube, Vimeo is ad-free, which means you don’t need to pay for advertising space. What you need to pay for is a membership to access the site’s advanced features:

Keep in mind that Vimeo Marketing tactics can be a bit different from YouTube.

Social media and other marketing costs

Outside of YouTube, the biggest place to market your videos is social media. Facebook, in particular, has more than 1.7 billion users, making it the largest promotional platform. One such example is the Taylor vs. Treadmill video done by Apple to promote their Apple Music service.

Other platforms that you would want to promote in include Twitter, Instagram, and Pinterest.

You can manage your social media accounts on your own without extra monetary cost. But this will eventually become too tedious when you have other aspects of the business to also manage. Hence, you should get a dedicated social media manager. Social Draft says that hiring one will cost you somewhere between $500 and $2000 a month, with the more established experts fetching even higher rates.

The number of views and likes your video gets also plays a large role its promotion. The more views people see, the more they are tempted to click and watch the video. Hence, you might also want to boost that count by buying views or likes. Rates vary from provider to provider. Devumi charges $12 for 2,000 views.

Additional promotional opportunities could also come offline, such as having your video content played at certain events. The cost for these will vary greatly and depend on what you can negotiate.

How much will everything cost you?

Assume that you go with the minimum for your video marketing campaign. You can expect the following breakdown of the estimated costs:

  • Semi-pro production for a 2-minute video: $1,500
  • YouTube ads at a rate of $.10 and targeting 1000 views: $100
  • Vimeo Pro account: $17/month for 1 month  
  • Social media campaign with a dedicated manager: $500 for one month
  • 2000 bought views (Devumi rate): $12

These will give you $2129 for the total costs. But, as is with any other marketing effort, this initial estimate does not always come close to the actual costs you end up paying for. To cover these, you should add at least 10 percent of that amount. With that, your total investment budget for a single video marketing campaign would be around $2342.

Tracking and measuring your ROI

Once you have your investment budget figured out, you can finally determine the potential return from it. From there, you will be able to keep track of whether you will be able to keep track of your sales and see if you are meeting that target.

Determining the financial tipping point

Social Media Examiner says that the first thing you want to determine when calculating your video marketing ROI is the financial tipping point or break even point. This is the point where your sales finally start earning a profit from your initial investment.
To calculate the number of sales you need to break even, use the following formula:

Break even=fixed cost/(unit price-variable cost)

Where the fixed cost is your video marketing cost, the unit price is the price of a single good or service you are offering, and the variable cost is the cost require to make a product.

In our example, the fixed cost would be $2342. Assume that the price per unit of your product is $30 and the cost to produce each unit is $20. Your break even point is then:


You need to sell 234 units of your products to get past the break-even point for your video marketing investment.

Video marketing metrics you need to be aware of

With your break even point established, you can begin tracking ROI for your video marketing campaign. For this, there are three different metrics you can use.

The revenue generated by the campaign is arguably the first metric you want to consider. But, video marketing blog Animoto says that it is also one of the hardest to measure. This is mainly due to the fact that you can’t always readily determine which customers made a purchase because they watched your video.

But you can still determine how much your video marketing efforts impact your revenues by comparing the earnings you made before the campaign and after. You can also track the traffic coming from the video to your product landing pages to see how much it has increased. Additionally, you can use third-party services like Wistia to keep track of your video statistics.

Lead generation
Your videos can be used to generate new leads for potential customers. These leads can be tracked via Google Analytics, where you can determine the amount of traffic coming from your video to specific product pages. Additionally, you can use the email capture feature of some video hosting sites to keep tabs on your leads.

Your videos can be used to generate new leads for potential customers. These leads can also be tracked via Google Analytics, where you can use the same tracking methods above to determine whether they are indeed coming from your video. Additionally, you can use the email capture feature of some video hosting sites to keep tabs on your leads.

Assessing the success of your video marketing efforts isn’t just about tracking revenues, though.The level of engagement you generate is also important. Getting your customers engaged helps keep your business in their minds and makes them more likely to make future purchases from you. The more engagement you generate, the better.

The amount of time viewers spend watching your videos is the first measure of the level of engagement you have. Do they just watch a few seconds before leaving, or do they stick around to see everything? You also have to take into account how many people viewed the videos. Finally, there are the further actions they take, such as liking, sharing, and commenting, as well as clicking the included links.

Marketing channel FunnelBox provides a quick explanation of how these metrics all line up to help you assess the success of your video marketing campaign.

Tracking your sales

When tracking the sales generated by your video marketing campaign, you need to distinguish these from the other sales you make. One way you can do this is to by including links with your videos directing to specific product pages. You can then use web analytic tools to track the traffic coming from these links and compare them with those coming from other sources.

Social Media Examiner also says that you might also want to inflate your sales a little to get your ROI. This is to take into account those purchases made after people watched your videos or those done in non-traditional ways.

Aside from the more well-known analytic tools like YouTube Analytics, other tools you can use to track sales include:

You can either use these separately or combine them to get a better picture of your campaign’s performance.

Calculating your video marketing ROI

With everything taken into consideration, you can go ahead and determine your ROI. You have two ways to determine this:

Simple ROI
This is the most basic way to calculate your video marketing ROI. When calculating simple ROI, you set the sales growth you get during the duration of the video marketing campaign against the costs of that campaign. The formula for this is:

ROI=(Sales growth-marketing costs)/marketing costs

Continuing with our example, let’s assume that your business sales increase by $3000 during the duration of the campaign. Calculating for the simple ROI:


You end up with a 28.9 percent sales growth.

Campaign attributable ROI
One thing to keep in mind with using simple ROI is that it assumes that all the sales growth come solely from your video marketing. In reality, you are likely going to run it alongside other marketing campaigns which contribute to overall sales. To determine the impact of the video marketing campaign, you have to set its gains against the average monthly sales growth. This is referred to as the campaign attributable ROI and uses the following formula:

ROI=(sales growth-marketing cost)/marketing cost-average sales growth

Again, going with our example, assume that your business has an average monthly sales growth of 5 percent. Computing the campaign attributable ROI:


Thus, your video marketing campaign has resulted in an overall sales gain of 23.9 percent. This is a modest number but would still be something to be positive about, especially if it is within your video marketing campaign’s goals. Note that these are not the only means of determining your video Marketing ROI. As stated above, you can also view the level of engagement as a return for your marketing efforts.

Also, a one-month sales growth is not always enough to determine the overall success of your campaign. For that, you have to keep track of your returns for several months. Depending on what your ROI trends show, adjust your marketing campaign accordingly.

Keep track of your video marketing ROI

As you have learned, video marketing is a great way to increase sales. But to know how successful your campaign is, properly measuring your ROI is important.

  • Determine the costs. Your video marketing expenses can vary greatly depending on the scope, level of quality, and expected results you set.
  • Consider your secondary promotional opportunities, such as purchasing views, or including a Twitter retweet package for your social shares.
  • Track your returns. ROI is most often determined by sales, but you can also consider different metrics depending on your campaign goals.
  • Study your ROI. These will give you a good picture of the campaign’s contribution to your business overall sales growth.

Once you have your ROI, you can then modify your campaign accordingly to increase its effectiveness. Don’t forget to keep track of your video marketing ROI regularly. This will help in making future plans for your business, and propel your different channels forward.


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