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How Do I Calculate Roi On Print Advertising?
Posted By: Jojo* on 10/6/2004 7:56 PM (CST) 125 Points
I am working on an advertising campaign and I hear all this talk about ROI on advertising. How do i calculate the ROI on print advertising? What do i need to do?
What are the measures and methods?

Posted by: mgoodman Member Response
10/6/2004 9:40 PM (CST)
ROI is the right concept, but measuring it isn't nearly so easy or straightforward. Whatever you're advertising is affected by so many things in addition to the print advertising that you could spend a lot of time and effort trying to measure the fifth digit to the right of the decimal point, while the number on the left goes negative.

The question, of course, is "What's the profit on the incremental sales generated by the advertising?" That's your ROI.

My advice for print advertising is to construct a simple experiment where you have a professional market researcher contact people in your target audience. Ask them a series of questions about the brands/companies they are aware of, how they'd rate them, etc.

Then let them read 6 or 8 print ads in a magazine or trade journal environment. You ad would be one of them. Then ask them the same questions you did before they read the ad. And then ask them direct questions about your company/brand, whether they recall seeing an ad for your brand, etc.

Finally, ask them how likely they would be to purchase your brand. That should give you some feel for how effective the advertising is.

A professional market researcher can give you some norms that would apply to your industry ... or you can add a control cell that doesn't see your advertising.

That's about as close as you'll get to a really good measure of ROI ... unless you have a lot of money and patience.
 
Posted by: darcy.moen Member Response
10/6/2004 10:23 PM (CST)
Gee, I've got an easier way to measure return on investment of your print advertising.

Go to your advertising department and ask them to create ads that include a response from your customers. For example, I'd ask a customer to clip a coupon, present the advertisment to get the deal, or something that gets you a physical piece of your advertisment. Instruct your sales staff that when customers turn in their "Ad" or coupon, they must write on the back of those ads amd coupons how much money the customer spent making a purchase.

At the end of the promotion, gather up all the ads/coupons turned in, and add up the sales dollars generated. Then, go back to your advertising department, and ask them to produce invoices for the print ads you've placed. Write the total down on a piece of paper.

Now, compare the numbers. How did your ad do? Did it cover the cost of printing the ads?

I may not have a marketing degree, but, I know that tracking sales generated to the ad that produced it has certainly cut the wasted ad dollars in my business.

My print ads would generate 14 percent response rates on a regular basis once I found which print media to use and the right offer that triggered responses and sales. I'll put that kind of track record up against anyone.

Oh, by the way, get yourself a big binder, and begin recording your ad campaigns and results. You may find it very interesting when the print ad sales guy calls, and you pull out a big book of results......

Then again, this same book makes for good reading on slow days. You can look back and think about what you could do to change your ads and make them pull even better. Ahh, isn't advertising fun?

Darcy Moen
(Customer Loyalty Network)
 
Posted by: mbarber Member Response
10/6/2004 11:29 PM (CST)
Ah yes the old dilemma - how do we prove our value?

Well the FIRST thing you might like to cosider doing (but so often ignored by marketing departments and finance teams alike is determine the answer to the follownig question "What TYPE of return do we want to measure?"

That puts things in a WHOLE different ball park, enable the marketing department to get out of the straight jacket placed on it by the weird financial types and also gets the financial types to at least see (hopefully also accept) that there's more to it than just a straight income return that is measurable.

Right ten - what for you would be considered a 'return' that would be valued by your company from its print campaign?

Would 'Increased brand awareness' be considered valuable?
Would 'Word of mouth' be considered valuable?
Would 'Increased number of inquiries' be considered valuable?
Would 'Sales made in the next month' be considered valuable?
Would 'Sales made within one week of the ad, be considered valuable?'

By working out the 'what form and shape should the ROI take?' you can then ask the next question in the ROI process - 'What level of each form of ROI would be deemed acceptable to consider this campaign a success?'

Too often the ROI challenge is broached from very limited filters - instant income from instant sales is the only ROI measurement.

And as you can see from some of the questions I've added, there can be (and often IS) so much more ROI going on.

The trick is you have to run through these questions BEFORE you go to market because if you try to do it AFTER the event, the finance types can just say - you're just trying to cover the fact that we didn't get our money back straight away.
 
Posted by: jason.koulouras* Member Response
10/7/2004 7:49 AM (CST)
Make sure you include a dedicated phone number and dedidcated special URL on the advert. This way you can measure and track inbound responses to the ad as being impact related to that ad and that ad only

Cheers
Jason
 
Posted by: mmprint Member Response
10/7/2004 9:32 AM (CST)
Hi Joanne,

The most obvious and successful of all approaches has not been mentioned.

Depending on the size of your organization, implement policy for representative to ask a simple question when a potential client contact's you. "Excuse me Sir/Miss, one more thing... How did you hear of us anyway? "

Create a simple formatted log, which the reps can easily enter the contact info. I see this question all too often and I am still baffled why people are scared to ask such a question.

I am sure whatever system you use to maintain your clients/order history contains a feature to allow entry of a "source" or "found us how" field to later generate reports, you can also just tally your logs which are collected and entered into a database.

Those who are contacting you from advertising are at this point interested in your services, don't be so worried about doing this. We collect all information in a very casual way, when a new client calls, it just require you to teach your reps how to be natural and not sound like a robot collecting information. Over the last year I can tell you how many people called us, where they are from and how they found us down to the keywords used in search engines. The reporting benefits of this are extremely valuable.

You can view a sample of our own survey sheet at the following link. It doubles as an estimate worksheet as well. http://www.mmprint.com/clientinfo.pdf

Do you have a website?
Last month I ran a promotion, where I sent out 15K postcards to print buyers on our mailing list throughout our market. This postcard was basically a ticket, we assigned and numbered each postcard to the specific contact and used a number generator to choose a winning number. These people were instructed to simply go to our site, enter your number and see if you've won a new Apple I-pod. The special webpage can only be reached by the address printed on the postcard and only that postcard recipient can win. Now every time a postcard number was entered, it was recorded in our database, if the winning number was entered, the winner was automatically notified on the webpage, as were we. We offered a free I-pod to a targeted audience which allowed for close to 8000 entries on our site. When & if they purchase in the future, we'll know how they originally found us.

I hope this helps, let me know.

Cliff
 
Posted by: dezinerguy Accepted Answer
10/7/2004 10:16 AM (CST)
If you just want to calculate ROI here is a link to a online calculator.
http://www.marketingtoday.com/tools/roi_calculator.htm

ROI measurements may not always be that valid though.

mbarber is correct to remind us though that you can't measure everything and some things that are not measurable are still valuable.

Cliff, I think had a great idea. Entice and measure. I'm currious Cliff, what did the people see when they went to your landing page? Were they required to read though some info before they entered there Number? Were you able to convert many of those 8k hits to sales? Can you be sure the reason they bothered visiting the site wasn't partialy do to some previous advertising or awareness of you business?

I would try to make as much of my advertising measurable so I could see if it the advertising is going in the right direction. Understand that your ROI may not be solely dependant on that campaign unless it is your first.

Advertising...Art or Science? Perhaps a little of both.
 
Posted by: SteveByrneBranding Member Response
10/7/2004 1:36 PM (CST)
Hi Joanne,

Good input so far. I would add the concept of direct response print advertising’s A/B split testing. Basically many publications will allow (small fee) advertisers to run two versions of an ad in a single issue. Example – with a circulation of 100,000 -- 50% will have an A version of the ad and the other 50% will have a B version of the ad. The difference between the A and B versions can only be tested by one element at a time, such as the headline, a photo, or the offer etc. There will always be a clear winner, A or B. The winner becomes the standard for the next version to test against. Over time the advertiser will “evolve” a great producing ad.


Link to -- Multi Variable Testing: Web Site Testing Beyond the AB Test:
http://www.fortpoint.com/media/articles/beyond_the_ab_test.html


hope this helps,

- Steve
 
Posted by: SteveByrneBranding Accepted Answer
10/7/2004 1:47 PM (CST)
sorry, wrong link (web version)

try this one:
http://test-and-track.com/Documents/article8.htm
 
Posted by: SRyan ;] Member Response
10/7/2004 10:51 PM (CST)
Wow, what an incredible load of quality answers here already! This is one of the "favorite Q&A threads" I'm adding to my personal file.

This might be a good one for Val's next newsletter feature, too.

Joanne, thanks for posting the question!

- Shelley
 
Posted by: Jojo* Author Response
10/8/2004 1:19 PM (CST)
Dear All,

Thank you for your answers. I work in a small firm where there is no budget for marleting research/analysis but the ideas really help. Thanks.
 
Posted by: Jojo* Author Response
10/8/2004 1:20 PM (CST)
OK - i am so sorry. I'm new to this and just realize that I wanted to accept the answers from most of you but I don't know what happened. And it seemed to list that I only accepted very few. Sorry. Once again, thanks for all the useful answers.
 


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