ROI from Web Experience Management Making the Case
Date: Tuesday , September 01, 2009
The Web is a primary channel for driving sales, customer loyalty, and operational efficiencies; so building an effective Web presence is clearly business-critical. Investing in the right Web initiatives can also quickly deliver a meaningful return on investment (ROI). Web Experience Management (WEM) capabilities can enable enterprises build and deploy an effective Web presence that will help drive revenue and cost savings. This makes it easy for business users to manage the Web content, campaigns, and the websites as a whole and deliver a relevant and engaging experience to website visitors. However, in today’s challenging economic scenario many enterprises have become cautious about major new technology investments. To secure a budget for these important initiatives, one must therefore demonstrate a positive ROI from the Web projects. Fortunately, one can make a compelling case for WEM using a straightforward method of ROI calculation and measurement.
The solution begins with outlining a business case for the WEM initiatives and determining the metrics most important to your business that WEM projects can have an impact on. From there, straightforward ROI projections can be created based on potential bottomline as well as top line improvements. These projections can help get your projects funded and off the ground; and can also demonstrate success to your organization as the project progresses.
From Managing Content to Managing User Experience
The Web is critical to a positive customer experience overall. Organizations have realized that to be effective in marketing, customer service, internal and external communications, and more, they need to deliver highly relevant content and a rich and interactive customer experience online. According to Forrester, 63 percent of WCM decision makers view improved customer experiences as a goal for Web content management implementations. WEM capabilities are the set of tools the marketing and customer experience professionals need for easily managing and updating Web content and for transforming the site visitors’ Web experience as rich and effective as possible. The right WEM platform not only supports revenue-generating activities, but also drives significant operating cost savings by enabling organizations to engage a broad audience in a targeted manner, to encourage communities around their products and services, and to manage a large Web presence with ease. WEM capabilities are thus central to driving both top and bottomline business results.
WEM solutions offer the ability that enable business users to collaborate around Web content, author content online, design the site layout, publish content to the live website, create targeted campaigns for online visitors, dynamically deliver the right content to the right site visitor in the right language, analyze and optimize the effectiveness of Web content, and enable online community interactions with user-generated content. With WEM, organizations can centrally manage and globally deliver a rich experience and consistent branding across multiple sites in multiple languages, supporting and utilizing a diverse set of content contributors.
Fig1: The components of WEM
Driving Top Line Success
By offering an engaging online customer experience, organizations across many industries can gain tremendous benefits, including increased site traffic, conversion rates, customer advocacy, and customer loyalty. Organizations can drive revenue-using WEM through several key techniques:
* Increasing return visits and loyalty: With the relevant content and an engaging Web presence, organizations can influence the prospects, customers, partners, and other site visitors to return more often and recommend the organization’s products and services to others. For companies selling online ad space, this leads to greater revenue through more eyeballs on the site. For organizations selling products, this leads to a greater likelihood for prospects to convert into customers, as well as shortened sales cycles. For information-based services this leads to a higher quality service being delivered, driving subscriptions and readership.
* Increasing online conversion rates: Through enabling targeted content and campaigns – and making it easy to optimize these campaigns regularly – WEM can help increase conversion rates as well as upselling and cross selling. With targeted promotions and recommendations, organizations can provide site visitors with the most relevant information based on their preferences, needs, or stage in the sales cycle, making them more likely to register and make purchases.
* Improving time to market: By launching new online content and promotions more quickly, organizations can realize the gains from their programs sooner, as well as respond rapidly to new developments or market changes. For example, a news site that is able to post frequent updates during a major newsworthy event can increase page views significantly, and thus its reputation and ad revenue as well. In the meanwhile, a product company that can get information on a new product or service to market online faster can see the impact of those new capabilities realized earlier.
Fig2: A model for the top line revenue results organizations can achieve by implementing WEM
Driving Efficiencies and Saving Time
WEM solutions can provide significant savings by minimizing the amount of time it takes to perform routine site maintenance tasks, and enabling IT and business resources to be used more strategically. The key efficiency drivers include:
* Increasing IT output: By enabling marketers, content contributors, and other lines of business staff to author and edit content, WEM solutions can create dramatic savings by taking the burden off the IT staff that perform the daily content management tasks. IT resources can thus be used instead on higher-value technical tasks. For example, a major financial company has been able to support over 100 sites and 150 different content contributors globally with a team of only four developers, driving tremendous efficiencies for their business and enabling a small development team to strategically and successfully support a global business.
* Increasing content contributor and marketer output: Easy-to-use tools for managing website content and campaigns can also provide the marketing department and the other lines of business with great efficiency. With intuitive tools, business people can more quickly and effectively manage content and campaigns without having to wait in a queue for assistance from technical staff. Reduced time in creating and editing content, finding and reusing content, and creating and launching online campaigns leads directly to greater business efficiency. The user-friendly interfaces can also limit training time required and encourage a high rate of adoption of WEM tools.
* Increasing customer service efficiency: Using WEM tools to create and maintain an up-to-date customer support site with the content targeted at the individual customers’ needs can result in major savings. By enabling customer self-service and encouraging them to go online rather than call the customer service phone center, organizations can deliver high-quality customer service with limited resources. For example, a global technology company was able to cut support center call volume by half after implementing a new dynamic customer support site, saving millions of dollars per year.
Once bottomline cost savings are calculated, they can then be added to top line revenue increases to produce the net benefit of implementing the WEM solution.
Fig3: A model for the savings organizations can achieve by implementing WEM
Net Benefit and ROI
Once an organization has calculated the projected net benefit of the solution based on the metrics most relevant to its goals and strategies, this number should be compared to the total cost of ownership (TCO) for the WEM solution. TCO is calculated by adding software license fees, professional services costs for implementation, and ongoing maintenance and support fees for the WEM project. The TCO of any pre-existing Web content management system should be subtracted from this amount to calculate the true incremental TCO of the new system.
With both projected net benefit and incremental TCO, one can determine how quickly the investment made in the WEM can be paid back. Using these data points, the payback time in months and subsequently the annual ROI payback percentage one can expect to achieve can be calculated. These calculations are critical to building a strong business case for investment, and for showing the success of WEM projects over time.
Fig4: ROI worksheet
One final note: In addition to the measurable ROI, it is also important to consider the added non-financial benefits the WEM can provide – such as higher customer satisfaction and loyalty, an enhanced brand image, and improved employee job satisfaction and performance. No matter what solution or approach you choose, continuing to measure and analyze your results over time will be key to achieving your business goals and showing results to your stakeholders.
The author of this article is Loren Weinberg, Senior VP, Marketing and Product Management and Elaine Chen, Director of Marketing, FatWire Software