ROI has got to be the most overused (but not necessarily overrated) buzzword to come along in the last five years. Measuring return-on-investment has gone far beyond a mathematical equation that helps determine the ultimate financial worth (worthiness) of a given project. The upfront question seems to be “what is the investment you are measuring against”? Is it strictly a financial one (x dollars spent on y technology) or does the initial investment far exceed the monetary factors? What about time invested – human resources, “sweat equity”, intellectual capital expenditures (i.e., patents, branding)?

Just when you thought the whole idea of ROI and adequate measurement couldn’t be more convoluted, along comes the call for ROI measurement for marketing programs. Yes, being able to track, measure and account for marketing expenditures and how they positively impact the bottom line is super important, but it must not be the be-all, end-all of marketing project management. We regularly talk with marketers and executives who see ROI as the Holy Grail for marketing effectiveness, and use ROI as the sole measurement in determining what programs make the cut for next year’s budget. Well, how can you effectively measure PR or ad placements over the short term without considering the ramp-up (in the case of PR), or the frequency and required saturation in the case of advertising. Trust us, placing print ads will not provide immediate sales spikes or an abundance of qualified leads.

What’s the point here? Be realistic about how ROI can help you better measure success, but don’t become obsessed with its power or impact.

What’s the ROI on adding this post? Hmmm …