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Advertising Resource Center |
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What's the Score?
You may be aware that in a basketball game the assistant coaches keep an almost unending list of personal statistics for each player. Rebounds, assists, points, minutes played, etc. Why is that? Because they know that these individual statistics all add up to the bottom line. The final score. If they can achieve even a small incremental improvement in these individual statistics for each player this will have a compound affect on the final score. And of course, it helps them know which players to give the most playing time too. In marketing your business you should be just as disciplined. Which products and which ads and which media should you give the most playing time? Do you know? What's the point of designing and implementing an advertising campaign if you don't know if it worked or if it was better than the last one? What a waste. How do you know where the best place is to spend your advertising dollars? By tracking everything. Incoming calls, emails, walk-ins, website visitors, etc. Train yourself and your staff to always ask these questions. Where did they come from? How did they hear about you? Which ad did they call on? Here is an example: Let's say you place a classified ad in the newspaper at a cost of $135.00 offering a free report on your product. You could track the incoming calls in many ways (for instance by directing them to a free recorded message with a unique extension number or simply by asking them where they heard about the offer when they call). Let's say you receive 12 calls on this ad and 2 of them end up as completed sales. What is your cost per prospect? (Cost of Ad) / (Number of Calls) = Cost Per Prospect $135.00 / 12 = $11.25 Your cost per prospect is $11.25
(Number of Sold Clients) / (Number of Prospects) = Conversion Rate 2 / 12 = .17 (or 17%) Your conversion rate of prospects to sold clients is 17%
(Cost of Ad) / (Number of Sold Clients) = Cost Per Sale $135.00 / 2 = $67.50 Your marketing cost per sale is $67.50.
Which ad is performing better? What is your cost per prospect for this ad? (Cost of Ad) / (Number of Calls) = Cost Per Prospect $450.00 / 27 = $16.67 Your cost per prospect is $16.67
(Number of Sold Clients) / (Number of Prospects) = Conversion Rate 4 / 27 = .15 (or 15%) Your conversion rate of prospects to sold clients is 15%
(Cost of Ad ) / (Number of Sold Clients) = Cost Per Sale $450.00 / 4 = $112.50 Your marketing cost per sale is $112.50. Depending on your products and profit margin both of these ads may be performing well enough to merit continuation. However, based on this information we would want to look for other opportunities to expand our use of the classified ad first. This may seem a little basic but this information is extremely valuable and often overlooked. The outcome of most athletic contests is normally decided by a very small margin, sometimes by as little as tenths of an inch or hundredths of a second, missing that pass completion by half a step or missing one basket. One would suspect that most winners and losers in business are also determined by very small margins. Not giving that extra little bit of caring and customer service. Not having your presentation skills honed, not including testimonials with your sales information. Not having the most effective headline in your ad or not having a headline at all. And worst of all, not knowing which ads are working and which should be put on the bench. "If at first you don't succeed, try, try again. Then quit. There's no use being a damn fool about it." - W.C. Fields Shawn Meldrum has spent the last two decades marketing everything from almonds to landscape lighting. He currently specializes in marketing for mortgage brokers, loan officers and real estate agents. For free mortgage marketing articles and much more visit: http://www.MortgageMarketingTips.com/
MORE RESOURCES: Without the right focus in Washington, job creation will continue to be slow and unsteady, says columnist Frank Aquila The number of Americans seeking jobless benefits fell last week to a level that indicates the labor market has not improved this year even as the economy expanded. The U.S. economy is so bad that the chance of avoiding a double dip back into recession may actually be pretty good U.S. stocks extended Wednesday's gain as initial jobless claims fell and pending home sales unexpectedly increased Treasury 10-year notes fell for a second day as pending home resales unexpectedly rose in July and initial jobless claims dropped last week, reducing demand for the safety of government debt. Orders placed with U.S. factories rose less than forecast in July, restrained by a slump in demand for capital equipment that points to a slowdown in business investment in coming months. The biggest rally in almost two months in the U.S. stock market yesterday was missing the hallmarks of a move that’s likely to last, said Jeffrey deGraaf, the top-ranked technical analyst. AIA Group Ltd., the main Asia unit of American International Group Inc., submitted preliminary documents to the Hong Kong Stock Exchange for an initial public offering, according to two people familiar with the filing. Naked short sales of shares and government bonds may be limited by European Union proposals that say the practices cause a “disorderly market and possible systemic risks.” Pending sales of existing houses unexpectedly climbed in July from a record low, indicating the real-estate market is steadying following the end of a government tax credit. The U.S. Securities and Exchange Commission is examining whether high-speed traders helped trigger a 700-point drop in the Dow Jones Industrial Average on May 6 by repeatedly placing and immediately canceling orders in an attempt to manipulate share prices, a person with direct knowledge of the inquiry said. Wall Street analysts offer buy, sell, or hold opinions on stocks in the news on Sept. 2 Wall Street analysts offer buy, sell, or hold opinions on stocks in the news on Sept. 1 Aug. 31 -- Karl Case, an economics professor at Wellesley College and co-creator of the S&P/Case-Shiller home-price index, discusses the U.S. housing market Aug. 31 -- Bloomberg's Ryan Chilcote reports on a dispute between Iceland and the U.K. over mackerel fishing quotas and the risk the row may affect the North Atlantic nation's bid to join the European Union Despite warnings by some experts, funds that try to profit from a falling stock market are an increasingly popular choice for investors With yields above other asset classes, real estate investment trusts are popular again. Pros tell Businessweek.com how to spot the best REITs |
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