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Advertiser’s Biggest Question

Ever since department store magnate John Wanamaker quipped, “I know half of my advertising is wasted, I just don’t know which half,” businesses have been trying to assess the results from their advertising.

In a recent survey, more than 10,000 business owners and managers across North America were asked what question about marketing or advertising keeps them awake at night.

Overwhelmingly, their most burning question was, “How do I measure the R.O.I. (Return on Investment) of my advertising?” or, “Which media can give me the best R.O.I.?”

Over the next few months, we will explore several guides to measuring and improving your advertising R.O.I. in your weekly SoundADvice, but the short answer is, “You can’t measure advertising’s R.O.I. in isolation.”

Why? Advertising is only one small, but integral part, of your marketing mix. And advertising certainly cannot make a bad business a good business. All five ‘P’s in your marketing mix must be aligned for you to maximize your return on investment.

Your marketing mix must have

There are so many variables in the marketing mix, from competitive factors to weather and from timing to technology, that your advertising cannot be measured in isolation.
The purpose of advertising is to move your customers through the marketing funnel from unawareness to awareness of you, and ultimately to preference of you.
That preference is what assures you have a competitive edge at the time of need.
It is this preference that is the ultimate ‘tie-breaker’ when your product, place, price, and people are perceived to be at par with your competitors. And it is that preference which governs everything from S.E.O. (search engine optimization) to selling at a profit, and from creating valuable word of mouth advertising to customer loyalty.

As an example, research has proven that consumers do NOT click on the first name at the top of a search engine page as much as they will click on the business they are more familiar with or have a preference for.
Many businesses mistakenly confuse ‘response’ with ‘results’ in an attempt to measure R.O.I. The true R.O.I. measure of your marketing mix is held in three simple components;

  1. Do you get repeat and referral business? If not, there is something inherently wrong with your mix that advertising alone cannot fix..

  2. Are your selling at a profit? You can’t send your kids to college with ‘traffic’, and you can’t pay your mortgage with ‘clicks’ or ‘likes’. You can only succeed with profits.

  3. Is your market share growing? Advertising cannot create a market where there is not one, but it can increase your share of an existing market if all five ‘p’s in your marketing mix are in alignment.

We specialize in accelerating your results with the promotional ‘P’ in your mix. Click here for me to deliver a copy of the marketing funnel, and to discuss how to create valuable preference to grow your market share in a complex marketing world.