Question

Topic: Research/Metrics

I Need Advice About Measuring Marketing Roi

Posted by Anonymous on 6/24/2008 at 9:48 AM ET 25 Points
I am currently working for a company as a Marketing Intern; they do not currently have a Marketing dept and in all reality Marketing is a who new world to this company.
The main thing I have been working on is basically Market Research. We just build a new plant in Alabama so I have been researching potential customers and then sending them promotional items. Then I forward their information to sales reps in that area.
Well we currently do not measure the success of this project at all- I would like to start measuring the ROI and make sure that the investment on the promotional mail peices and the time it takes is worth it.
I know I need to find exact costs, and start measuring the costs of paying me and the other intern, however from there I am a bit lost. I have a concept of what I need to do, I suppose I just need some direction.
Can any body help me out?
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RESPONSES

  • Posted by melissa.paulik on 6/24/2008 at 10:53 AM Accepted
    Krystal,

    There are many metrics you could use but here’s where I would start.

    I always like to measure cost per qualified opportunity for many reasons. One is that the costs of developing a qualified opportunity are most often marketing costs and the responsibility is most purely marketing’s.

    It doesn’t sound like you’re identifying qualified opportunities vs just “names” that you are passing on to sales. You might need to measure cost per sale since you are not nurturing these names until they become “qualified.” While I probably wouldn’t bother trying to figure out sales costs, your marketing costs/sale is a much less relevant number. Sales costs are not added so the cost picture isn’t complete. And, the ratio can be better or worse depending on sale’s ability to move prospects through the pipeline.

    By the way, qualified opportunities are names that meet certain benchmarks such as in the correct target market, have an expressed need, and have an established budget. Qualified implies that sales will follow up with them.

    I always develop the qualification targets with sales so we are in agreement. You can get a good idea of whether your leads are qualified by determining how many of the names you pass over to sales actually receive a call. Salespeople tend to follow up on the contacts they think they can close so my guess is that many of the names you are generating end up never getting contacted.

    I write quite a bit about qualified opportunities vs leads and metrics on my blog. I also focus on career advice for marketers. Feel free to check it out at www.themarketingsurvivalist.blogspot.com.

    Good luck!

    Melissa
  • Posted by Frank Hurtte on 6/24/2008 at 11:35 AM Accepted
    I love it when people want to measure their value and subsequent ROI to their employer.

    Here are costs associated with your efforts:
    Salary - Don't forget benefits; use 30% if you don't know the cost of your benefits. No benefits; you still have a 15% Social Security contribution made by your employer.

    Cost Promotional materials
    Mailers, postage, trash & trinkets, other materials

    Revenue associated:
    New sales - what is the estimated profit margin?
    New customers - what is the life time value of a customer?
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