Tracking Offline Advertising Success by Measuring ROI

Copyright © Stone Evans, The Home Biz Guy
http://www.PlugInProfitSite.com/main-9336

The great promise of online advertising has
always been that advertisers will now be able to
effectively track the successes and failures of
their online advertising efforts. This promise
has been met.

Yet, for those of us who still employ offline
promotions and advertising methods, we must
consider the various ways in which we can
effectively track our results in the old-world
media.

TRACKING RESULTS BEFORE THE INTERNET AGE

How long has it been? Ten Years? Believe it or
not, it has been less than ten years since the
Internet went mainstream.

Companies still utilize the same methods to track
results as they did before we laid our hopes on
the Digital Superhighway.

TV advertisers ask you to call extension X. Radio
advertisers offer you additional savings if you
tell them you heard it on XYZ radio station. In
newspapers and magazines, advertisers suggest you
clip the attached coupons.

Why do you think advertisers employ these tactics?

Simple. They need to know what advertising is
bringing customers in the front door and to their
cash register.

By understanding what advertisers are bringing
them customers and dollars, they have a better
understanding of where to spend their next wave
of advertising dollars. Additionally, they can
do a side-by-side comparison of their Advertising
Return on Investment (ROI) to determine which
method brings them the most percentage of return
per dollar spent.

UNDERSTANDING HOW WE SHOULD MEASURE

The truth is that we really do need to know how
people are deciding to visit and buy from our
business establishment.

Some consider this idea silly or even a waste of
their valuable time. Far too many people, who
think of tracking in this fashion, end up
searching for a job at some point in their
future. Unless pure dumb luck is on the side of
the business owner, a business simply cannot
survive if it does not track the effectiveness of
its advertising.

Somehow, some way, a business owner or his
marketing staff must look at their advertising
and promotion budgets, and look at their
advertising mediums and find a way to know which
is doing the job for them and which is not.

DISCOVERING WHAT MOTIVATES OUR CUSTOMERS

Somehow, we must get our customers to tell us how
they found us and what ad motivated them to come
in and purchase our product or service.

Everyday, businesses motivate their customers to
tell them how they learned of them by having the
customer call a certain extension, offer them an
additional discount to tell them which
advertisement they had heard, or to offer them a
coupon to use.

Others motivate their customers to tell them how
they had learned of their business by offering a
very specific product in their advertising. They
know that if someone shows up at their business
to buy a certain product, then they will know how
the person had heard of their business.

This is why you should make your radio
advertising focus on a different promotion than
your newspaper advertising. Different mediums
should focus on different leader pieces so that
you can see which medium provides the best
results.

UNDERSTANDING WHY WE SHOULD MEASURE RESULTS

We measure advertising results so that we can
learn how to not waste our money and to learn how
to get the most bang for our advertising dollar.

Return On Investment or ROI is the key
measurement utilized to determine the value of
our advertising.

It is best to show in an example how ROI is
measured.

Cost of Newspaper Advertising: $150
Number of Items Sold As a Result: 60
Retail Price of Individual Item: $ 10
Profit on Individual Item: $ 3

Gross Income on Items Sold: $600
Gross Profit on Items Sold: $180

In this example, you have spent $150 to make
$180. Your ROI is 120%.

Cost of Radio Advertising: $ 300
Number of Items Sold As a Result: 50
Retail Price of Individual Item: $ 20
Profit on Individual Item: $ 6

Gross Income on Items Sold: $1000
Gross Profit on Items Sold: $ 300

In this example, you have spent $300 to make
$300. Your ROI is 100%.

Utilizing these two examples, you can quickly
discern why and how we are calculating ROI.

Now, some people would consider both to be good
investments of their advertising dollars. In
fact, many believe that so long as their
advertising generates enough sales to break even
as the radio example did, then they consider the
investment to have been in their future rather
than their present. So long as you do not lose
money on the transaction, then you should at least
be willing to continue with the advertising
medium that was used.

However, over time, you might find that the
newspaper advertising will continue to provide
the 120% ROI. If that is the case, then your
newspaper advertising should take more of a
center stage in your advertising efforts so that
you can develop more profits which can be used to
increase your dollar investment into your
advertising.

WELCOME TO THE WORLD OF TRACKING YOUR OFFLINE
PROMOTIONS

With this introduction, you should now have
available to you the knowledge necessary to
introduce tracking into your marketing efforts.
Those who take the time and effort to advertise
and track their results will benefit more than
you can imagine.

Truth be known, a single person with a dream
today started every big corporation in the world
many years ago. Each of these corporations grew
from a fledgling operation to a economic
powerhouse by tracking and tweaking their
Advertising ROI.

Every corporation and small business who will
remain in business through the long term will be
tracking their advertising and promotional
efforts today. It is an investment into their
future success. If you make the same kind of
investment of time and cash resources, you too
will be making an investment in your future
success.

About The Author:
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