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Productivity / Measuring success

Measuring success of traditional marketing campaigns

Remove the fear of measuring success in marketing campaigns with these simple and effective methods.

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When it comes to creating and running a business marketing campaign, you’ll have ideas thrown at you from a range of people on how to define your message, who you should target and how the campaign should be distributed. Ask these people “how will we measure the success of this campaign?” and you’ll probably hear the sounds of crickets in the background. If it was an online marketing campaign the reaction might be different, due to all the tools available to measure online marketing success.

Why the lack of enthusiasm for measuring a traditional campaign?

Many perceive the process as difficult and confusing, or are worried it will only add more work or highlight a campaign’s failure.

Another reluctance to measure may be caused by the number of differing methods available. Many academics have long-winded theories about evaluating customer lifetime value (CLV). All you need to do, they’ll say, is understand how many purchases a customer will make from you in a year and multiply this figure by the number of years you expect to keep this customer. Measuring a campaign this way means you need a crystal ball and psychic ability, which foresees accurate figures. I know if I had these super-human abilities, I’d be using them to obtain next week’s lotto numbers – not the lifetime value of a customer!

"Measurable results help justify future marketing activity and keeps the bean counters happy."

Marketing campaign formulas

Some marketers love formulas for calculating a campaign’s success. Try these on for size. The first uses the gross profit for units sold in the campaign and the marketing investment for the campaign:

Gross profit – Marketing Investment
Marketing Investment

Some companies deduct other expenses and use a formula such as this:

Profit  – Marketing investment – Overhead Allocation – Incremental Expenses
Marketing Investment

Phew, these calculations are confusing and require the input of a range of variables that may differ from one stakeholder’s perspective to another. You’ll then need to factor in extra time while all stakeholders agree on each variable. This process alone may very well deter many from ever contemplating measuring (or initiating) a marketing campaign.

Want more articles like this? Check out the measuring success section.

The industry standards method

Another popular method of measuring success in marketing campaign is to refer to industry standards. These suggest a percentage of returns to define a successful business marketing campaign. This figure can vary anywhere from 2 per cent to, well, anywhere. There are so many variables to include that I’m not comfortable judging a campaign’s success (or failure) based on a flat-rate percentage of response.

The simple approach

So what makes a successful campaign? My simple approach is to understand the average sales value and multiply it so it exceeds the cost of your campaign. The campaign costs should only take into account the additional costs incurred by the organisation – including design, print and distribution.

If the campaign will cost you $4000 to design, print and distribute, and the average sale is $500, then a successful campaign is achieved when it returns eight sales. That’s it. That’s a successful campaign. You’ve recouped your costs and made sales. You’re a success. You haven’t lost. This equation is easy to remember and easier to calculate.

Now consider this. We had a client who received zero sales from a campaign we ran. No sales, yet we still credited this campaign as a success. Part of our marketing campaign service is to follow up personally with targets. The customer feedback provided valuable insight. The results of this campaign helped define future marketing activity and resulted in sale increases across all marketing avenues. This would not have occurred if we did not run a follow-up and complete the first campaign.

My final suggestion to clients is that they run their campaigns so that results can be counted. Campaigns that “raise awareness and business branding” are nice, but the results aren’t measurable. Measurable results help justify future marketing activity and keeps the bean counters happy.

How do you measure the success of your marketing campaigns? 

Dean Parker

combines 15 years of marketing experience with a Masters of Marketing degree to help small/medium business owners maximise their profit.

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