It's true we spend marketing dollars to display at trade shows, to attend events, to hold conferences, and to produce marketing materials for campaigns.
How do we know what we are getting in return? How can we quantify the results of our marketing efforts to make sure they are worth the money spent?
This may seem like an easy question, however, it's one that I am asked often. I have seen companies that don't measure their marketing efforts. Let me just say that's a big mistake. While marketing can be in the most part trial and error you can diminish errors by actually using calculations to see which campaigns are bringing in the most results for the money.
It's vital to develop a consistent plan and marketing strategy that will help you project, measure and evaluate your marketing campaigns, without it you are simply going about marketing blindly. This is one of the most costly mistakes in business.
In each marketing campaign you must develop a plan and strategy that identify the following:
- Quantitive and Qualitative goals
- Campaign budget
- Fulfillment and response strategy
- Follow-up Strategy
- Tracking and testing criteria for your campaign
Depending on your objective most goals can be measured effectively using one of three methods. These methods include:
- Cost per sale
- Cost per qualified lead
- Cost per visitor
Once you decide which result you want to measure and you have the costs incurred for the event; calculating is actually fairly easy.
- Cost per Sale = Amount Spent for Event/Campaign (A) / Number of sales (S) = Cost per sale (CPS)
Formula: A / S = CPS
- Cost per Qualified Lead = Amount Spent for Event/Campaign ( A) / Number of Qualified Leads (L) = Cost per qualified Lead (CPQL)
Formula: A / L = (CPQL)
- Cost per Visitor or Response = Amount Spent for Event/Campaign (A) / Number of visitors or response (R) = Cost per Visitor or Response (CPR)
Formula: A / R = CPR
Using these formulas along with developed plan for each campaign will give you the information you need to decide if a campaign or event was effective for your business. If it was...Congratulations! If not, it's time to visit the efforts of the campaign and find out exactly why it didn't work and how you can improve it the next time. Was it the event location, wrong targeted marketing? Perhaps the materials that you sent out didn't carry a strong call to action? There are several reasons why a marketing campaign may fail and not bring you the desired the results, but future successes will come from determining what those reasons are.