Posted: 02/09/2007--25/11/2008 || Rate this Article: 3 || Views|| Sign In || Register ||Hello Guest
Return on investment (ROI) is used to measure the effectiveness of advertising campaigns. ROI is determined by comparing the cost of advertising to either sales or inquiries generated from the advertising effort.
The worst ROI occurs for situations where costs are high and response is low. Television and to some extent radio are the worst ROI advertising options. These are high cost with usually low response. You are reaching a large number of people that are not qualified prospects C in other words they probably dont want your product or service. It is difficult to provide a clear and effective call for action. This is largely because of the short time you have the prospects attention.
The best advertising ROI is when the cost of the advertising is low and the sales or inquires are high. If your business is based on products that sell without office or sales force contact, the most effective ROI will likely be direct response mail campaigns. Direct response mail allows you to clearly provide the benefits of your product, state your offer, and provide the method of purchase all for a relatively low cost. To make this type of campaign effective, the advertising packages must be mailed to lists of qualified prospects. Since you can rent focused lists for use in a mail campaign, you wont be wasting money getting your message to people that arent interested in your product or service.
If your sales product requires contact with office or sales staff of a service, the best advertising ROI is going to be direct response mail, advertising, and networking. The direct mail campaign in this case will be generating leads rather than actual sales. Your office or sales staff will be making the sale. Their effectiveness should be tracked separate from the advertising effort since actual sales closing are going to be greatly influenced by your staff actions.
Ads used for lead generation should also contain direct response attributes. Clearly state a call to action and give the prospect the information needed to make the required contact. If possible, provide a form that can be filled in and mailed requesting more information in addition to the option to call and talk with a person.
One of the cheapest advertising activities, and therefore likely to be one of the best advertising ROI efforts, for any business is networking. The key for successful networking is to follow up with prospects. Networking efforts likely to result in a high ROI would be a vendor or business booth at a networking event you would be attending anyway. Put together a give-away, bring plenty of business cards, and bring post cards for prospects to send in later or leave with you asking for more information or a future contact.
Inexpensive advertising efforts can have good ROI. Being creative when it comes to handing out information and tracking the response from any given effort will show you what works best for your market. You don't have to invest a lot of dollars in advertising to be effective.
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