Theres
More to Marketing ROI (return on investment) Than Meets the
Eye
All too often people look at
marketing ROI in terms of response rate: in other words, I sent out
10,000 pieces of direct mail and only got 39 responses which is
terrible. This is wrong think.
When it comes to marketing ROI, you have to realize that the term
means Return On Investment and the return is measured in dollars
(or your local currency). Lets say you spend $2,000 to get out a
bulk mailing of 5,000 pieces and you get 10 calls as a result.
Doesnt look like much. But of these 10 calls you close 6 and get
immediate sales of $12,000. Thats marketing ROI! And thats not even
taking into account the future sales to those 6 new customers. It
could add up to hundreds of thousands of dollars.
The same simple mathematics apply to any other marketing efforts:
radio ads, press releases or articles in magazines, print ads,
yellow pages, web site, etc.
Obviously you need to keep track of response from each marketing
campaign you do so that you can weed out unsuccessful campaigns and
strengthen successful ones.
Case in point:
Jeff Lee, CFO of a very successful consulting company, Measurable
Solutions, has adopted a successful small business marketing
strategy based on direct mail marketing. Key elements are mailing
out a newspaper and full color postcards. The design is done in
house and the printing and mailing is done by a specialized
postcard printing company. In his own words...
We get our best response from mailing out a newspaper and back it
up with postcards. Depends on the postcards. Some postcards have
pulled better than others.
The professionalism of the postcards is something that is
effective: it gets attention, it keeps the image that we want to
keep, it creates the reach, it creates the response and keeps our
leads in a very high range.
We probably average around
7,500 post cards per week. Out of 7,500 post cards well get in an
average of 15-20 leads. Of the 15-20 leads at least a third of them
come to our introductory seminar. So say 5 or 7 people show up and
they pay $1,700 a piece. Off of that we close a further $30-40,000
for services.
The money we have put into the postcards is like a drop in a bucket
compared to what we get back. We know that the more promotion we
send out, the more return were going to get. It always works.
That is excellent marketing ROI. Measurable Solutions spend about
$2,275 for 7,500 full color post cards. That includes printing,
postage, mailing (including the mailing list). From that they get
between $8,500 and $11,900 in immediate response for an
introductory seminar and an additional $30-40,000 follow-up
sales.
Spend $2,275, earn $40-50,000. You dont need to have majored in
advanced math and rocket science to work that one out: that is what
is meant by marketing ROI!
Results of direct mail marketing vary from business to business but
the principle holds and always works: if you send out enough
promotion, you will make sales and maximize your marketing ROI.
Dont worry about response rate if your marketing ROI is
high.
About the Author
Joy Gendusa founded
PostcardMania in 1998; her only assets a computer and a phone. In
2004 the company did close to $9 million in sales and employs over
60 persons. She attributes her explosive growth to her ability to
choose incredible staff and her innate marketing savvy. Now shes
sharing her marketing secrets with others. For more free marketing
advice, visit her website at www.postcardmania.com
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