Calculating the Value of Corporate Video Production

Corporate video production has emerged as a powerful tool in the business world, and its return on investment (ROI) is speaking volumes. HubSpot's research underscores the effectiveness of video marketing.

A significant 41% of marketers assert that video campaigns yield a high return on investment. In today's competitive landscape, where attention spans are shorter than ever, corporate videos have proven to be an effective way to engage and inform audiences.

They can be used for various purposes, including brand promotion, employee training, product demonstrations, and more.

With the proliferation of online platforms and social media, videos have become a preferred means of communication, making ROI in corporate video production a critical metric for businesses seeking to maximise their marketing efforts.

In this article, we delve into the world of corporate video production, exploring its undeniable impact on ROI and how organisations can harness its potential for greater success.

Why measuring ROI is crucial for your business

Tracking ROI allows businesses to understand the impact of their corporate videos on their bottom line. It helps identify what is working and what needs improvement, enabling companies to make informed decisions about their video marketing strategies.

One of the challenges in assessing video ROI is the lack of clear metrics. Unlike other marketing channels, such as email or social media, it can be difficult to directly attribute conversions or sales to a specific video.

However, this should not deter businesses from measuring ROI; instead, it should prompt them to adopt a clear and structured approach.

Setting clear goals for your corporate videos

The Importance of Setting Specific Objectives

Direction and Focus: Clear goals act as a roadmap, guiding the storyline, visuals, and messaging to ensure that every second of the video serves a purpose.

Budget Management: When objectives are set, it becomes easier to allocate resources appropriately. Whether it's deciding on animation versus live-action or investing in professional voiceover talent, knowing your end goal can help prevent unnecessary expenses.

Targeted Messaging: A video intended for brand awareness will have a different tone, message, and call to action than one aimed at sales conversion. Setting objectives ensures that the video speaks directly to the intended audience and serves its purpose.

Easier Evaluation: Once the video is released, having set objectives makes it simpler to measure its success. You'll have a benchmark against which to assess viewer engagement, reach, and conversion.

Common Video Objectives and Their Value

Brand Awareness: These videos aim to make more people aware of your brand, product, or service. They often focus on telling a brand story, highlighting company values, or showcasing the business's ethos. Example: A company documentary showcasing its sustainability efforts.

Lead Generation: These videos are crafted to capture potential customer details. They might include product demos, webinars, or tutorials that offer value to viewers in exchange for their contact information. Example: A software company offering a free webinar on its latest features.

Sales Conversion: Directly tied to ROI, these videos aim to persuade viewers to make a purchase. They often highlight product benefits, include testimonials, and have strong calls to action. Example: A product infomercial with a limited-time offer.

Education & Training: For businesses that want to educate their customers or employees, these videos provide detailed information or tutorials. Example: A how-to video on using a specific feature of a product.

Customer Engagement: Designed to engage and delight existing customers, these videos might include behind-the-scenes looks, customer stories, or company event highlights. Example: A recap video of a company's annual user conference.

Measuring Success Through Clear Objectives

Setting clear objectives for your corporate video is not just about ensuring a smooth production process; it's about measuring success and ROI. For example:

A brand awareness video's success can be measured through metrics like views, shares, and organic reach.

For lead generation videos, the number of leads captured, click-through rates, and viewer demographics can provide insight.

Sales conversion videos can be evaluated based on direct sales, conversion rates, and customer feedback.

Identifying the key performance indicators (KPIs)

• Views: This is the most basic metric and gives you an idea of how many times your video has been watched. It provides insights into its initial reach.
• Watch Time: This determines the aggregate time people have spent watching your video. A higher watch time indicates more engaging content.
• Engagement Rate: This is a combination of likes, shares, comments, and other interactive features. A higher engagement rate indicates that viewers find your content resonating and worth interacting with.
• Click-Through Rate (CTR): It represents the percentage of viewers who clicked on a call-to-action or a link associated with the video. This is especially important for promotional content where the objective is to drive actions.
• Conversion Rate: For videos embedded on landing pages or used in advertisements, this metric tracks how many viewers performed a desired action, such as signing up or making a purchase.
• Audience Retention: This metric reveals the percentage of the video most viewers are watching. A steep drop in viewers in the first few seconds can indicate that your video isn’t capturing attention effectively.
• Feedback/Dislikes: Negative feedback or higher number of dislikes can provide insights into areas of improvement.
• Video Shares: A higher number of shares means that your video content is compelling enough for viewers to share with their network, amplifying its reach.

Setting Up Tracking Tools and Analytics:

Embed Tracking Codes: If you host videos on platforms like YouTube or Vimeo, use their in-built analytics. If it’s on your website, tools like Google Analytics can help. Ensure the videos have tracking codes embedded for accurate metrics collection.

Use Dedicated Video Analytics Platforms: Tools like Wistia or Vidyard offer comprehensive analytics specifically for video content.

CTA Tracking: For videos with call-to-actions, ensure you're using UTM parameters to track the source of your conversions.

Integration with CRM: Integrate your video analytics tool with your Customer Relationship Management (CRM) system. This helps in understanding the role of video in your sales funnel and its impact on conversions.

The Role of Data in Assessing Video Effectiveness:

Data is the compass that guides your video marketing strategies. By understanding which videos are resonating with your audience, you can:

Refine Content Strategy: Based on metrics like engagement and retention, you can refine future content to be more in line with what your audience appreciates.

Optimize Video Placement: If a video has a high conversion rate, it makes sense to give it more visibility on your website or ad campaigns.

Increase ROI: By focusing on what works and trimming what doesn’t, you ensure that every dollar spent on video production yields the highest return.

Calculating ROI

Steps to Calculate ROI for a Corporate Video:

1. Determine the Cost of Investment: This encompasses the entire budget spent on creating the video. This includes:

Production costs (equipment, crew, actors, location fees, etc.)

Post-production costs (editing, special effects, music rights, etc.)

Distribution costs (platform fees, advertising to promote the video, etc.)

Example: Let's say you spent $10,000 on producing and distributing a corporate video.

2. Quantify the Gain from Investment: This involves calculating the revenue generated directly from the video. You can measure this through:

• Increased sales
• Lead conversions
• Engagement metrics that lead to monetary benefits

Remember to only consider the revenue that you can directly attribute to the video.

Example: After launching your video, you find that it directly led to an increase in sales, amounting to $20,000.

3. Plug the Values into the ROI Formula:

You can use the ROI formula to calculate the return on investment:

ROI = (Total Gain from Investment - Total Cost of Investment) / Total Cost of Investment

The Importance of Attributing Revenue and Costs Accurately:

Accurate Budgeting: By understanding your ROI, you can allocate budgets more effectively for future video projects.

Strategic Decision-Making: Knowing your video's ROI will provide insights into what worked and what didn't, guiding your future content strategy.

Stakeholder Confidence: A positive ROI can garner support from stakeholders, making it easier to get buy-in for future projects.

Avoids Misleading Results: Inaccurately attributing revenues can give you a skewed perception of your video's success. For instance, counting sales from another campaign can make your video appear more successful than it is.

Beyond the immediate ROI

Video content has the potential to provide lasting advantages for businesses beyond the immediate return on investment. Here are some key points to consider:

Improved brand reputation and customer loyalty: Corporate videos can help build a positive brand image by showcasing the values, culture, and expertise of a company.

When viewers connect with the message and visuals of a video, they are more likely to remember and trust the brand, leading to increased customer loyalty and advocacy.

Long-lasting impact on SEO and website traffic: Videos can significantly boost a website's search engine optimisation (SEO) efforts.

Including video content on a website can increase its visibility in search results and attract more organic traffic. Additionally, videos are highly shareable and can attract backlinks from other websites, further improving the website's SEO.

Building trust and credibility over time: Videos allow businesses to showcase their knowledge, expertise, and industry insights. By providing valuable and informative content through videos, companies can establish themselves as thought leaders in their field.

This builds trust and credibility with their audience, leading to stronger customer relationships and increased conversion rates.

Repurposing and recycling video content: Once a corporate video is produced, it can be repurposed and recycled for various marketing purposes.

For example, snippets of the video can be shared on social media platforms, embedded in blog posts, or used in email marketing campaigns. This extends the reach and impact of the video, maximising its long-term value.

In conclusion, measuring the ROI of corporate videos is vital for businesses. It provides clarity on their investment's effectiveness, guiding informed marketing decisions.

While directly linking conversions to videos can be tough, it's imperative to have a structured approach to ROI, including setting precise goals and pinpointing key KPIs such as engagement and conversion rates.

Clear objectives ensure effective messaging and strategy adaptability. Calculating ROI justifies investments and aids in resource allocation. Besides the immediate ROI, corporate videos boost brand image, SEO, trust, and can be repurposed.

The benefits of corporate video production are undeniable. It is a powerful tool that can greatly impact a business's return on investment (ROI) and overall success. By measuring the effectiveness of corporate videos and setting clear goals, businesses can optimise their video marketing strategies and achieve better results.