Cost-benefit analysis is a method of comparing the costs and benefits of different alternatives or scenarios. It helps you assess the value and feasibility of a project, policy, or action by estimating the net benefits or losses. A net benefit is the difference between the total benefits and the total costs of an option. A net loss is the opposite. The option with the highest net benefit or the lowest net loss is usually the most desirable one.
How do you measure your live streaming ROI with cost-benefit analysis? Objective Definition Clearly define live streaming goals Cost Identification Include Production Costs Personnel Costs Promotion Costs Platform Costs Benefit Quantification Measure Audience Reach. Consider Engagement Metrics: comments, likes, shares. Track Conversion Metrics: purchases, sign-ups, downloads. Assess Brand Sentiment from audience feedback. Recognize and assign value to intangible benefits like improved brand image and increased customer loyalty. Benchmark and Compare Iterate and Optimize
To apply cost-benefit analysis to live streaming, you need to identify and quantify the costs and benefits of live streaming and compare them to other options. These costs and benefits can be monetary or non-monetary, direct or indirect, and tangible or intangible. For instance, some of the costs of live streaming include the time and resources spent on planning, producing, and promoting your live streams, the equipment, software, and bandwidth required for live streaming, as well as the fees or commissions charged by the live streaming platform or service. Additionally, there are potential risks or negative impacts of live streaming such as technical issues, legal issues, or reputational damage. But some of the benefits of live streaming include revenue generated from donations, subscriptions, ads, or sales; growth and engagement of your audience; brand awareness and loyalty; as well as learning and feedback obtained from insights, suggestions, or testimonials.
Depending on your ultimate desired outcome, livestreaming can be a vehicle or a destination. If the goal is to be a livestreamer on your preferred streaming platform, you'd aim to extend your audience & reach to a threshold where you can monetize your content/channel. Calculate the cost to get there (taking ALL costs, incl your time, into account). Then forecast your potential earnings and calculate your break-even time and long-term profitability (be honest and conservative until you can forecast more accurately based on actual performance). In B2B, the goal of livestreaming is often sales/pipeline. The core principles above apply here as well, except "monetization" comes from leads and sales. Lead tracking and engagement are key.
Live streaming offers numerous benefits, with one being particularly valuable —courage! For many of us, facing a camera in real-time triggers some deep-rooted fears—sweaty palms, jittery hands, dry mouth...and more 🙈 Yet, as we open ourselves to being present with our audience, we can build up confidence over time. Overcoming our doubts not only benefits our business but also enriches our personal lives too. Remember, all progress occurs outside our comfort zones. Live video creates space for authenticity, allowing for genuine, unfiltered connections with our audience. Embrace the challenge—because you possess the power to captivate and inspire! Now is the time to share your story with the world.
To measure the costs and benefits of live streaming, you need to collect and analyze data from various sources, such as your live streaming platform, your website, your social media, your email list, your CRM, or your accounting system. Assign a monetary value to the non-monetary costs and benefits, such as the opportunity cost of your time, the social value of your audience, or the brand value of your live streams. Use methods such as market research, surveys, experiments, or benchmarks to estimate these values.
First, define a goal for your livestreams. Is it to build audience, extend your reach, or build your personal/company brand? Or perhaps more tangible such as lead generation and sales pipeline? Be realistic about what you can achieve first, then adjust goals over time. Each defined benefit can and should be measured. Track it, but don't beat yourself up if the ROI takes a while to develop. Compounding returns will develop over time. It's possible to scale without major additional investments in hardware after the initial outlay (although it's tempting to spend more). Investment in time may be different, but as you do more you also achieve economies of scale. Be firm and consistent in pursuing your goals. Measure, adjust, expand, repeat.
To calculate your live streaming ROI, you need to subtract the total costs of live streaming from the total benefits of live streaming and divide the result by the total costs of live streaming. Then, multiply the result by 100 to get a percentage. The formula is:
ROI = (Total Benefits - Total Costs) / Total Costs x 100
For example, if your total benefits of live streaming are $10,000 and your total costs of live streaming are $5,000, your live streaming ROI is:
ROI = ($10,000 - $5,000) / $5,000 x 100
ROI = 100%
This means that for every dollar you spend on live streaming, you earn two dollars in return. A positive ROI indicates that your live streaming is profitable, while a negative ROI indicates that your live streaming is losing money.
To improve your live streaming ROI, you need to increase your benefits and reduce your costs. To achieve this, set clear and realistic goals for your live streaming and track your progress. Additionally, choose the right live streaming platform and service that suit your needs and budget. Optimize your live streaming quality and content to attract and retain your audience and promote your live streams effectively and consistently to reach and expand your audience. Monetize your live streams strategically and ethically to generate revenue, and evaluate your performance and feedback regularly to make adjustments.
One of the best ways to improve your live streaming ROI is to repurpose your Live streams into other marketing content. From one live stream event you can: - Use the audio & create an audio podcast - Use the audio & create an audiogram to promote your podcast - Create a series of short video clips & post them to all your social channels - Transcribe the audio & create an article for LinkedIn, blog post for your website, or even a lead magnet The more content you can create from one live streaming event will help improve your live streaming ROI.