Like everything else, the only way to improve your marketing efforts is to measure. It is not possible to do better without knowing what you are doing. Businesses have to find the right tools and methods to achieve their goals with limited resources. For this reason, you need to measure how much your advertising budget focuses on your goals with your advertising budget, which is already a limited resource.
It is possible to advertise for many purposes. Although advertisements are set up for various purposes, the main purpose is to get more customers and sales. Whether you want to increase the awareness of your brand in the sector, whether you make a promotion or organize promotions to expand your sector, the increase is actually targeted. Nobody throws money on the street by advertising for business.
Although we will focus on internet ads due to our field in this article, the measurement criteria we will list below are also valid for non-digital advertising studies. Wherever you are doing advertising work, there will be an investment amount to pay and you will expect a benefit in return. Nobody has endless resources to spend on advertising work. For this, every advertiser wants to find the most efficient media and ad format possible. Unfortunately, we don't have a formula like a recipe. Instead, there is data we recommend you follow. Here is the data you can measure the quality of your advertising investments;
Return on Investment (ROI)
It is the reflection of your advertising investment on your turnover. When you invest an amount of X in advertising, the total turnover of sales coming through these ads channel shows your return. This is a data that can be measured by means of certain tools in sales made over the internet. It is possible for a non-online business to track the sales channel, albeit difficult.
This information is the information every advertiser needs to evaluate their ads. Thanks to this data, you can see whether the stone you throw is worth the bird you scared or not in daily language.
A business that advertises in more than one channel can choose the most logical channel by measuring the return on investment of all areas. Thus, it can have the opportunity to use its limited resources in the most logical area.
Cost Per Win
It is the data that shows how much a sale costs you in advertising. If you have to bear the advertising cost of X to sell each product, this cost should be added to your product's costs.
When the investment cost you have to bear to sell each product is determined, the investment amount for reaching the required number of orders to fully utilize your production possibilities becomes clear.
This data is useful to manage the advertising policy and finance of the companies and is one of the data that an investor wants to know. If the production facilities and capacity information are ready, there is nothing left to do except bear the marketing cost per sale and get sales.
Cost per sale can be calculated over all advertising and sales amounts of a website, as well as at the product, campaign and media level. Knowing your cost per sale in Y campaign and Z channel to sell X product can show you which product, how and where you should be promoted.
Potential Cost Per Lead (Cost per Lead)
If there is an offer step in your sales process, the best method to evaluate your advertising investments may be to know your cost per potential customer. Knowing the cost of each customer who requests an offer from you, requests discovery or examines your price list allows you to direct your investment.
In some sectors, jobs reach the sale through processes such as proposal and discovery. If you work in this type of business model, this data is vitally important to you. First of all, determine how many jobs you can do per month. Then derive an average of how many of your 10 bids turned into sales based on your old bids. You will find the number of bids you need to place in order to get your targeted sale. After that, what you need to do is calculate your monthly advertising investment by calculating your cost per potential customer.
The figure showing how many of the 100 visitors on a website turns into customers shows the conversion rate of that site. This figure can also be viewed through campaigns and products.
A good advertising work will improve your conversion rate by bringing potential customer traffic to your website.
Your conversion rate consists of many different components such as incoming traffic, site design, device compatibility, and product segment. It requires expertise to sort out all components and identify inputs that directly affect the conversion rate.
Often there is no such thing as a perfect conversion rate. By constantly monitoring your conversion rate and optimizing the customer journey, it is improved.
Perhaps the greatest proof that advertising is effective for a business is sales. "If the sales are good, the ads are good." Simplifying this data can cause you to ignore the details. Sales may fluctuate constantly depending on the season, competitors' situations and your campaigns. In order to measure the ad quality on the sales chart, it may be useful to compare it with an equivalent advertising campaign.
Using Google Analytics (or a similar tool), you should also measure and analyze the sales process for leads generated by each marketing campaign (for example, visits, interactions, leads, sales conversions, and percentages). This can give you more information about your traffic or sales cycle, as well as help you find spots where customers have abandoned their sales journey.
Getting a customer often brings more than a sale. All the turnover your customer generates while trading with you is a lifetime value.
It will take time to acquire such data, but this may be the most important of all concepts. Such data compiled specifically for your products and advertising channels will show you which products and advertising channels bring the most loyal and long-lasting customers. Thus, you will have the opportunity to direct your business and resources to the right areas.
Multi-Channel Funnels and Attribution
There are too many channels and channels to advertise now. People can request information about the product multiple times and from other channels before purchasing a product. A customer can view your product on social media, then return to it by typing your name in a search engine. The old reporting system, which assumes that customers come to products from a single channel at a time when channels and traffic sources are so confused, can hide the real data from you.
As a result, you must know and measure what you are doing. Leaving things on your own path will not take you forward most of the time. In order to use your company's limited advertising budget in the most efficient areas, you must make correct planning, accurate measurement and continuous improvements.