Measure Marketing Return – In previous chapters we’ve discussed how frustrating it can be to invest in new marketing and advertising campaigns. Let’s face it, you’re unable to really measure the results of your advertising and marketing campaigns. Sure, you may notice that the phone rings a bit more frequently when your ad runs in the local paper. But, as we’ve touched on previously, the phone ringing may not be a good thing. If you can’t tie each sales back to the specific advertising that the customer responded to and each lost sale to the marketing they experienced, then you’re guessing.
When you are able to track advertising in this way, some very powerful things begin to happen. Your ability to objectively evaluate advertising options greatly improves. Your negotiating position with advertising and marketing vendors improves. Your ability to hold these vendors accountable to promises and expectations they set improves.
These things should enable you to have significant impact on the cost of and quality of leads. If you can reduce the average cost of each lead by 10% and increase the quality of each lead by 10%, that could be big for your business couldn’t it?
Well, that’s just scratching the surface! After all, getting the leads is not really the most challenging part of acquiring customers is it? It’s closing the deals. It’s hiring, training, motivating and managing all those sales people to take the leads your marketing generates and turn them into customers.
There is no question that the single most effective way to ensure the success of a sales person is to provide him or her with the highest quality leads. If 80% of your sales people are over quota this year instead of 20% like last year, what does that mean to your bottom line?
OK, hopefully I’ve got your attention now! So let’s get specific about how we can measure the results of your advertising and marketing, channel by channel, ad by ad, so you can maximize the most profitable and do away with the duds.
Way to Measure Advertising and Marketing Return Easily
Create a system to track leads from first contact through to close.
Now, don’t lock up your checkbook so fast… I’m not proposing that you run out and spend thousands of dollars on expensive solutions. In fact, this is one area where things can and should be extremely simple. Heck, if you can draw up a one page “lead sheet” that your reps can use to quickly check off the results for each and every lead, great! You’ll need someone to sit down periodically and tabulate the information but, this type of low-tech approach might be the best place to start for many.
Regardless of what method or technology you choose, here’s what you need to know about each lead –
Where did it come from? Be specific here. If they found you on the web, you need to know exactly how. If they did a search first, then you’ve got to know what they searched for. If they saw an ad in a magazine, you need to know which one.
Are they qualified? In any business, there are 3 or 4 questions you can ask any lead and know if they’re likely to become of customer. You’ve got to be sure you ask these questions every time and record the answers. (See our recent eBook – Double Your Sales in 2010 – for more discussion of how to qualify leads)
What are they likely to buy, for how much and when? Ultimately, we want to project the total amount of sales that can be expected and the projected time frame for each and every advertising option you have. This info is clearly crucial.
Did they actually buy and if so, what and for how much?
A couple of other things that are important to find out –
What’s this person’s role in the purchase decision?
Are they currently working with a competitor?
Again, if you can come up with a low-tech way to capture this information consistently for every new lead, that’s great. After all, this is going to require some changes in your processes and methods for your customer facing team so, you should keep it as simple as possible. However, if there are more than one person in your organization dealing with each potential customer or if the volume of leads that anyone in your team is considerable, then writing it all down can get to be a problem. Remember, all your analysis will be skewed if this information isn’t gathered consistently.
So, investing in a good contact management solution or CRM can be wise. Keep in mind the purpose of this exercise… You’re going to reduce the average cost per lead, increase the average quality of each lead and ensure that your sales people beat their quotas and your company grows!
Basic requirements for your contact management system or CRM solution that will allow you to measure your advertising results effectively –
Allows you to document the above information quickly and easily for each and every lead
Allows you each person on your staff that will interact with the lead or prospect before purchase to update the same contact management or CRM database
Allows you to mine the information captured to see the number of leads from each advertising source and quantify the portion that buy, aren’t qualified and/or are still in process.
That’s it. Remember, simplicity is key to success here. This is a means to identify the most profitable advertising channels for your business, it’s not an end in itself. Don’t get enamored by CRM solutions that do everything anybody could ever want but, cost thousands per person and take months to implement. That could defeat the purpose.
Regardless of whether you choose a low-tech approach or a high-tech online contact management solution or web based CRM system, you’ve got to be able to learn this information about each lead. So where is that data going to come from?
Way to Measure Advertising and Marketing Return Easily
Ask the prospect.
Again, we’re going for simple. Sure, you could invest in all sorts of technology, fancy survey emails or even telemarketing surveys to gather all this info but, how long is that going to take to put together? What will it cost? Believe it or not, many sales people will push back and resist asking the specific questions you need answered. You’ll need to help them understand how you’re going to use the information to provide them more leads that are higher quality.
It’s crucial that you follow through too. You can set your efforts back by months or years if you force this on your sales team and then fail to use the information.
Be clear – every person that has contact with the lead before they purchase is going to need to be consistent in asking the decided upon questions and recording the answers.
Way to Measure Advertising and Marketing Return Easily
Make it automatic.
Hey, wouldn’t that be cool? If you’re completely ecommerce, then it may be possible. All this data can be gathered by your website and shopping cart. However, if your customers typically talk to a human being at your company as a part of their decision making process, then there is going to be some manual data entry. No matter how shiny and new and innovative your contact management or CRM solution is, it’s the information that your customer tells your sales person that is likely to be the most valuable to you in measuring the effectiveness of the advertising that drove him or her to your company.
So, you should focus on automating all the other steps along the way and making it as quick and easy as possible for the sales person to add their contribution.
For instance, you can easily have different 800 numbers that you publish in each ad so you’ll know how the lead found your company when you pick up the phone. If they’re visiting your website first, you can build tracking into your web forms that will capture what terms the lead searched for in Google to find you. Many online contact management systems and web based CRM solutions allow your web forms to post new sales leads directly into the database with tracking information embedded.
If you’re using a contact management system or CRM solution, then required that the sales rep fill out all the key data we’ve discussed when they create or update the lead’s record. Also, make sure it’s easy for the sales rep to see what key information has yet to be gathered on each lead so they can ask those questions.
I’m sure you’ve got the idea. In the end, we want to see a table something like this –
# of LeadsQualifiedClosed
Trade Journal Ad 100 50 20
Paid Search 200 50 10
Radio Spot 50 25 15
Add the costs for each of those ads and you can calculate which is most profitable. You’ll be amazed to find that what you think you know if wrong and how much opportunity is available when you redirect spending to the most profitable channels.
Remember, this is the 5th chapter in our newest eBook, “Build Your Own Automatic Selling Machine”. Register to receive each new chapter as its released and the entire eBook when complete, free here.