Why ROI Isn’t a Fair Statistic in Measuring the Success of Economic Development Websites

Economic development organizations (EDOs) must invest heavily in their websites to promote their regions and attract investment. As an economic developer, you understand the importance of measuring the success of your website. However, relying solely on ROI (return on investment) as a measure of success may not provide an accurate picture of the impact of your efforts.

The Limitations of ROI

ROI is a commonly used metric in business, which measures the return on investment relative to its cost. However, the limitations of this metric become apparent when applied to EDO websites.

#1: EDO websites are not designed to generate direct revenue; instead, they are intended to attract businesses and talent to the region. As a result, calculating ROI based on website-generated revenue is not a meaningful statistic.

#2: EDO websites are part of a larger marketing strategy that includes advertising, networking, and outreach. Attributing all new investments or job creation to the website alone is impossible, as potential investors may have been exposed to the region through other channels.

#3: EDO websites serve a wide range of audiences, including site selectors, investors, business owners, workforce, government officials, and community members. Measuring success based on a single metric ignores the complexity of the website’s audiences and may overlook important aspects of its effectiveness.

Alternative Metrics for Measuring Success

Instead of relying on ROI as the sole metric for measuring the success of an EDO website, economic developers should consider alternative metrics that provide a more nuanced view of the website’s effectiveness. Here are some examples:

#1: Engagement metrics, such as time on site, page views, and bounce rate, provide valuable insights into how users interact with the website. For example, if users are spending more time on certain pages, it may indicate that those pages are more relevant or informative. On the other hand, high bounce rates may suggest that users are not finding the information they need or that the website’s design is not user-friendly.

#2: Conversion metrics, such as form completions or newsletter signups, can provide a more direct measurement of the website’s effectiveness in generating leads or building relationships. While these metrics may not directly correlate with new investments or job creation, they can provide a better understanding of the website’s impact on the user’s decision-making process.

#3: User feedback from government officials, community members, and business owners can provide valuable insights into how the website is perceived by its audience. Asking users about their experience on the website, the information they found most helpful, and areas for improvement can help identify specific areas for improvement and help shape the website’s ongoing development.