This article an excerpt from our whitepaper, ROI in FDI: Measuring Place Marketing Success in Investment Promotion.

Measuring ROI in FDI marketing presents unique challenges. However, the inability to calculate a precise ROI doesn't negate the value of marketing efforts. Instead, it calls for a more nuanced approach to measurement and evaluation.

We propose three actions for IPAs to consider when promoting their destination for FDI. Those three actions are:

See the website as a value-generator.
Leverage technology for long-term data analysis.
Embrace a holistic KPI approach.

See the Website as a Value Generator

A website is your destination's digital welcome centre. It is the hub of all marketing initiatives and can assist companies in learning about your location when they are in research mode. Ensuring that key information is freely available (not only to executives, but to search engines who can connect audiences with information in these FDI impact moments) is vital.

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Still, too many IPAs hide information behind a Contact Us form with the hopes of forcing someone to contact them. This results in poor quality leads that make it through and lost opportunities who don't want to deal with the inconvenience. Instead, offering assistance using a helpful "Get in Touch" prompt without expectation is bringing in a healthy flow of quality leads to most groups that are using it.

Conversations with IPAs and our direct experience in digital marketing for IPAs of various sizes suggest that the following metrics are attainable with a well-designed website.

To be clear, the numbers above are of qualified leads, or leads that can be pursued for further engagement and meetings. There are always a higher number of web leads collected which are spam or individuals seeking employment. This is frustrating, but inevitable.

IPAs that spend significantly on marketing campaigns (€ 500k or more) greatly enhance these numbers, but even without big money, these quantities can add a significant contribution to the annual FDI pipeline.

Leverage Technology for Long-Term Data Analysis

Nearly all IPAs have already invested in CRM tools that allow for long-term tracking of investor interactions, but their use varies greatly. Getting marketing teams more integrated into these tools will enable better tracking of lead sources, improved data collection and automation that supports business development teams.

For those without a structured process yet, below are basic buyer stages for starters.

By having a process like this in place, a baseline can be established from which to measure future campaigns. As marketing efforts are implemented, their performance can be judged on the impact they are having. This includes more qualified leads, better conversion into opportunities and improved win rates. When approached collaboratively, breakdowns in the journey can be identified and solved together for overall performance improvement over time.

One detail that receives less attention is tracking every lead source with discipline, whether it is a website visit, event attendance, or content download. The best of the best make asking the question "How did you hear about us?" a mandatory part of early verbal sales conversations (and recording it in the CRM) while website forms ask the same. Doing both of these allows for improved intelligence on where leads or originating and where future budget should be spent.

Embrace a Holistic KPI Approach

Rather than fixating on a single ROI figure, IPAs should adopt a balanced scorecard approach that considers multiple metrics in the grand scheme of their organizational objectives. Recognizing that image, perception and visibility are a natural part of decision-making, a brand marketing layer to annual IPA KPIs is a smart decision.

The KPIs almost universally tracked include the following:

opportunities, which are often called leads, but they are usually active investment projects;
jobs created, or what we'll call workforce;
capital investment, or what we'll refer to as gains.

We propose a fourth – image enhancement or reputation. This is a measure of how visible a location is to investors (website visits from target markets), how many are showing interest (marketing leads) and what the status is of their perception about your region. See the GROW framework below.

The framework here shows where image enhancement coincides with project opportunities, jobs created and capital expenditure. Website visits are quite meaningful for judging traction, particularly those from target markets. Marketing leads and their subsequent conversion into opportunities can expand an IPAs reach globally, extending far beyond the traditional hand-shakes at conferences and investor events.

Finally, perception studies are valuable because, well, perception matters. A positive perception pays off down the road by getting on more company radars and going into project opportunities from a position of strength. Negative perception is the opposite and improving it is paramount to positive change. Perhaps most frustrating is no perception at all – your place is not on the radar and lacks emotional gravitas. Knowing where you stand and measuring that over time is a data point to direct future efforts.

Image enhancement KPIs won't be meaningful in 3, 6 or sometimes even 12 month cycles on their own. But by tracking these over time, they become valuable data points in deciding how to adjust investment promotion activities to drive additional demand.

This holistic view allows IPAs to demonstrate progress not just in the short-term, but also considering the long-term growth of a location's reputation and visibility as an essential component of its growth story.

While perfect ROI measurement remains elusive in business attraction, these three approaches provide a foundation for measuring marketing investments and continuously improving strategies to attract FDI. Implementing some of these measures might take 1-2 years before registering meaningful data, but the goal is to create a system that allows for informed decision-making, continuous improvement, and clear communication of marketing's value to stakeholders. By focusing on these elements, IPAs can confidently move forward in an era where marketing's role in FDI success is shifting.