Measuring and maximising ROI
There are certain ground rules when assessing the success of a campaign. There will be financial and non-financial benefits and both must be tracked.
The true ROI and benefit of targeted campaigns can only be achieved over time. Do not be discouraged if the first few campaigns do not immediately generate a positive ROI!
Establish a baseline, and measure both financial and non-financial impact. Continue to measure this success over time.
As a Syncoms client, you will have access to our expertise in tracking and analysing the success of your campaign so that you know what really works for your company.
Key metrics of a successful campaign
An important first gauge of success is the response rate i.e., the total number of responders divided by the total (net) number of pieces mailed.
In the case of a web component, consider the percentage of those who: opened the email (open rate); clicked through the link to the PURL (click-through rate); completed a survey (form-fill rate); clicked through all of the pages on the URL and reached the “thank you” page (completion rate). Consider also the number of website visitors who spend time on the website or pURL.
When assessing the success of social media use, consider the number of new Facebook fans, Twitter followers, retweets, social mentions, blog entries, etc.
Other factors to consider when measuring ROI include the number of qualified leads, number of transactions, store traffic, total campaign cost, cost per lead (cost to get a person to respond), cost per sale (cost to get a person to buy), revenue per sale and Return on Investment (revenue generated by the campaign, minus the costs, divided by the costs of the campaign.)
The impact of time
It is vital when assessing the success of a campaign to consider the results over time.
The Lifetime customer value is an important measure, even though most companies are not well-equipped to measure it because customer satisfaction and loyalty drives more long term than short term value. LCV increases significantly with targeted campaigns, since customers will not only purchase more, but will also be more loyal.
The customer frequency, reach and yield should also be considered ie the transactions per month, the number of new customers reached, customer spend per transaction and reduction in customer turnover.
Best practices in managing a campaign
- Plan, experiment, test, measure, and evaluate.
- Define business objectives up front.
- For consistent messaging, involve PR, traditional media, and other disciplines in interactive campaign planning.
- Always build success metrics into campaigns; split campaigns so you can compare results. Metrics should be simple, meaningful, and easily measurable.
- Try to measure the true isolated impact of the campaign (taking into account any halo and cannibalisation effects).
- Many campaigns build slowly—give them time to succeed!
Using data to improve future campaigns
It is important to understand what worked and didn’t work in the campaign by tracking the activity and results for each respondent.
Syncoms can help you to analyse the data so that you know which consumers responded better and in what locations the campaign has had the greatest effect.
Find out what components of the marketing campaign truly drive the impact, versus merely increasing complexity and cost?
Data will help you to understand how future campaigns can be further tailored and targeted by using the database analytics to understand your customer base and to identify meaningful behavioural, attitudinal, and demographic differences between groups.
For more information read these articles:
What is targeted mail?
What is multichannel marketing?