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Tracking Results Means Quantifiable ROI

Issue 3 - April 12, 2010

When they read about 1:1 print marketing campaigns, one of the things that marketers look for right away is response rate. Whether it is in a case study, an article or their own marketing, they want to know how many people responded. Was it a 6% response rate? A 12% response rate? A 27% response rate?

But response rates alone don't tell you much. What you want is return on investment (ROI), and in order to determine that, you need to know a lot more. You need to know the value of the sale, the profit on that sale and the total cost of the campaign, including program development, design and database development. That's why it's so critical to monitor and measure your results.

When a furniture retailer wanted to boost its sales, for example, it set up a program by which it could follow up with visitors who did not make a purchase and try to close the sale. Once visitors entered the store and were helped by a sales associate, the associate asked for certain information. The associate entered the information of visitors that did not make a purchase into a database. The retailer sent a personalized follow-up brochure within 72 hours. The brochure thanked them for visiting, included the store address and phone number, the name of the sales associate who helped them and the hours that person worked. It also included images of the furniture the visitor liked or similar furniture if the images of the actual furniture were not available.

The results? The brochures generated a 10% return rate from those who received them, but more importantly, because the retailer tracked its sales closely - including the average value of each sale - it was able to determine that those shoppers who received the brochure spent 40% more than those who did not.

Many marketers make the mistake of not tracking results. Or, even if they do, they track only response rates, not dollars spent. Because this retailer tracked both, it could create a solid ROI calculation. It knew - in hard numbers - exactly how valuable that promotion had been to its bottom line.

In today's marketing environment, with an ever-expanding array of media competing for your marketing dollars, it's critical to be able to quantify which marketing programs are creating profits and which aren't. By taking the time to track all of the relevant metrics and do the ROI calculations, you can not only feel great about your next 1:1 print campaign, but use the information to justify those marketing dollars in a powerful and convincing way.