“Is my marketing working?”
Seems like a fair enough question, right?
And a responsible one to ask, too.
Smart business owners should know if their marketing efforts really work – and more specifically, which ones work best.
But for most small businesses, separating marketing from sales (and the results of one marketing activity compared to those of another), is like unraveling a Gordian knot. It’s impossible get the information untangled!
So is there truly a way to measure the ROI of Your Marketing Efforts?
Yep. One method involves examining every marketing activity, determining a desired and measurable goal, and then measuring response.
Let’s take a look at an example:
• Email. The goal of an email newsletter might be to drive web traffic. Measure the amount of traffic before the newsletter is sent, and compare it with the traffic after the email is sent.
• Direct mail. Count the number of people who respond, or the increase in appointments your sales reps are able to generate by following up.
• SEO. Measure traffic coming to your website from search engines, using Google Analytics to track the data.
• Social media. Measure the number of Facebook likes, Twitter followers, retweets, etc. And you can use tools like Social Mention to track the results. You can also look at Google Analytics to see the trends in traffic being driven to your website from social sites.
For many businesses, what matters most is gross margin (it’s the measure we recommend most clients use). The goal of marketing is really to make your sales team more productive. Your marketing may generate direct sales leads, or it may simply open the door for a sales call. In fact, one of our most successful recent campaigns lead to a 100 percent improvement in the ratio of sales calls to appointments, which in turn led to a significant increase in close percentage, and a reduction of the sales cycle, from many months to less than four weeks!
At BARQAR, we tell our clients to measure marketing based on gross margin dollars produced from new clients closed, as a result of the combined effort of their marketing campaign and sales follow-up efforts.
Rather than separating sales from marketing, it’s easier to measure their combined results and determine:
• Did sales productivity improve? Look at metrics like the ratio of calls to appointments, the length of the sales cycle, and the percentage of prospects closed.
• How much gross margin was produced? We recommend measuring gross margin over a period of one year from the end of the campaign, since many new clients will start small and then increase their volume over time.
The bottom line is that if you really want to get serious about measuring your marketing efforts, you must:
• clearly define what you want to accomplish
• set a minimum target for ROI
• measure the gross margin to ensure your target is being met
Want to increase your marketing ROI?
Put BARQAR’s digital and inbound marketing experts to work for you – and get higher quality sales leads, a stronger reputation and a better bottom line. Need more info, want a demo or ready to talk numbers? Give BARQAR a call today.