Return on investment (ROI) is a standard – and hugely important – business tool as it helps measure financial profitability. Businesses, after all, are in the business of being profitable and should use metrics such as ROI to maximize their returns and focus efforts on areas that yield the most to the bottom line.
ROI can and should be used by organizations, as it is important to measure various marketing and spending efforts and to then use the results to refine their marketing efforts in order to spend their money wisely. Knowing the ROI on your marketing efforts helps you measure the best “bang for the buck” to reach your target audience and drive more customers to your business.
ROI is pretty straightforward and creates a compelling case to be used as a tool when looking at various projects or opportunities. However, it is important not to focus so much on return on investment that you lose focus of value on investment.
Value on Investment (VOI) is defined as “intangible assets that contribute heavily to an organization’s performance. These intangible assets include knowledge, processes, the organizational structure, and ability to collaborate. Where ROI is the measure of the tangible benefits of a project or activity, VOI is the measure of the intangible benefits of a project or an activity. VOI includes ROI.”
Gartner, Inc., the world’s leading information technology research and advisory company, has helped establish the concept of Value on Investment (VOI) to encourage organizations and companies to not focus singularly on traditional ROI. Gartner states that enterprises that evaluate initiatives solely on quantifiable benefits are missing the opportunity to reap increasing value from “soft” initiatives.
Participating in membership organizations such as professional trade associations and chambers of commerce is better measured as a value on investment versus a traditional return on investment. Members of chambers and associations still receive ROI from their membership via group leads, business referrals, website presence and social media posts – all things that can be easily measured.
It is more challenging to measure the value of membership in organizations. Vail Valley Partnership (VVP) efforts range from community programs to networking events, from business advocacy to destination marketing, from workforce development programs to educational events. We recognize that not all the programs and events we offer are relevant to all businesses, but taken in aggregate we are confident that membership in the VVP has a high return on value to our members and our community.
Some key components that make up the value on investment of chamber membership in the VVP for businesses and organizations of all sizes, throughout the valley (and for businesses located outside the valley that happen to do business here). As Eagle County’s largest business organization, we provide a high value on investment, including:
- Information & Insight: we provide timely and relevant information and research to our members and help highlight our members to others in the community. This insight helps provide data and tools to our members allowing them to improve efficiencies in their operations. Weekly newsletters, monthly economic indicators and annual workforce studies all keep business operators aware of opportunities and demographics in our region.
- Programs: we provide a variety of business-to-business programs and lead efforts to improve Eagle County’s business environment. We take the initiative to bring together public and private stakeholders to benefit the business community. Over 14 different cost savings and signature programs are available to members to help increase your marketing exposure and awareness of your business.
- Economic impacts: our group sales and destination marketing initiatives drive visitation and we have tools in place to connect visitors directly to our members, benefiting our members, the business community, and industries we serve. Impacts of our sales efforts last year exceeded $51m.
- Influence: we work to represent Eagle County stakeholders and business community interests to regional & statewide organizations and provide local facilitation of economic development activities. This ranges from our focus on increasing air service to bringing together broadband service providers to state level issues including working with the state insurance commissioner (health care), the I-70 Coalition and the Tourism Industry Association of Colorado.
- Networking: we provide opportunities for members to make connections, share information, and learn best practices from a community of their peers. These opportunities range from Leads Groups to Business After-Hours Mixers to Breakfast Scramblers.
- Education: we offer our members topical and cost-effective (almost all complimentary) educational opportunities so members can be aware of emerging trends and issues that impact our region. Stay tuned for details on our upcoming program: Impact of the Affordable Care Act on Small Businesses in the Vail Valley on April 7.
Business success requires return on investment, as return is tangible, as in dollars and cents; business success also requires value on investment. Value is intangible, as in relationships and people and influence. And as most successful business people understand, a true success in today’s business environment means both return on investment and value on investment.
Members can apply what they have gained to their own organizations to meet their business goals. At VVP, we deliver Value on Investment, which includes both financial and intangible benefits for our members.
Our community understands this and it can be summed up best by a recent email received by a member: “Thank you for all you do at the Partnership. It enhances the ‘community,’ of Eagle County and beyond. You guys probably don’t hear that often enough, but it does not go unnoticed.” We appreciate the sentiment and the recognition of the importance of return on value your membership in the Partnership provides to your business.