As an entrepreneur who has tackled his fair share of creative ventures, it’s amazing in hindsight to think how much the spectrum of getting what you pay for has shifted for both investors and advertisers alike.

derooted-creative-agency-2012-ROI-inner2Looking at it another way, as someone who’s gone through business schools and written numerous business plans, the idea that the traditional metric for ROI – Return on Investment – has shifted to something different in that the qualitative results are no longer always emphasized over the qualitative ones.

Today a new ROI – Return on Involvement – reigns supreme in businesses psyche in that in order to justify investment, dollars aren’t always the gauge for success but rather those investing in various initiatives are more concerned with seeing traction via customer involvement.

derooted-creative-agency-2012-ROI-innerHaving just submitted a funding application to a government agency relating to a Media/Arts venture I’m currently exploring, I can say for a fact that this transition is taking hold and is reflected in what those who cut the cheques – in this case the Ontario government – are looking for.  Specifically, the metrics we are being asked to report on to demonstrate the success of our initiative relate strictly to tracking the growth of audience involvement and interaction and it’s not that they are not also asking to have financial metrics reported but rather that they are not expecting this to be the main source of information to be gauged.

And this is government money we’re talking about here but after talking to the fund administrator, it made a little more sense.  Because we are still, relatively speaking, in the infancy of the online age, investment made especially as it relates to online initiatives are not expected to pay back what’s put in but rather so long as growth is shown, those behind the ventures see it as a rationale to continue their projects, seek further investment and figure out how to monetize it later.

Not exactly the formula they taught me in Corporate Finance class but one that I’m sure they’re starting to teach today.

By: David King