The most common question I get asked is what will be my success rate for a direct marketing campaign…
This is a really tough question for me to answer… Marketing all depends on speaking to the right person at the right time with the right offer, get these right and you have a successful campaign … get them wrong and the campaign flops
Therefore I suggest looking at the past activity always ask about their historic activity and successes of previous campaigns such as What activity did you do get your existing customers? How much did you have to spend to get these customers?
Often clients don’t know or record these figures… which takes me on to this week’s blog “Do you know what is your return on that investment is?”
So taking it back to basis.. what is Return on investment?
A basic definition of Return on Investment involves looking at the cost of a marketing campaign relative to the profit generated.
You put £1000 into a campaign to try to sell £100 worth of goods
You sell 30 of them at the profit of £50each making a total profit of £1500 on the campaign.
But this profit is before the cost of the campaign so take off the campaign costs
I.e £1500 profit less cost £1000 = £500
The return gained is £500 from your original marketing investment of £1000.
Your Return on this Investment is £500 divided by £1000 = 50% ROI.
So what are the benefits of knowing the return?
- Allows you can see where the money was spend
- Saves you time & money campaigns that don’t work
- Allows you to invest in future direct marketing campaigns that work
- Plan for future successes
The over all benefit of knowing the figures ensures that you are spending your time and money in the most productive way….
So the next time you plan a marketing campaign … make sure you have the processes in place to record your successes.