To make the most of your marketing dollars, it is critical to evaluate how well your marketing strategies work. Then you can choose to continue using only the marketing strategies that yield the most return for your money. Here are five different ways to evaluate the effectiveness of your existing marketing strategies.
Talk to Customers
The easiest and most often overlooked way to evaluate your marketing strategy is to talk to customers. Find out how they came across your company and compare it against the list of marketing channels you use. If all of the customers you talk to find your company the same way, take a closer look at the other marketing strategies you’re using. The ones your customers don’t know about probably aren’t as effective.
Identify Traffic Sources
By creating specific coupon codes for each marketing channel and type, you can quickly identify what attracted customers to your business. For instance, you can use the AUG2020 code for a pay-per-click (PPC) ad and the code AUG3020 for the ad when it appears as a sponsored blog post. As customers use the coupons, the codes let you know which strategies are gaining the most traffic. Make sure to use a different code for each ad and each channel.
Evaluate Return-on-investment (ROI)
The most important metric of the effectiveness of your marketing strategy is your ROI or return on investment. This is the amount of money you’ve spent on a campaign compared to the sales revenue the campaign brought in. Some business owners don’t think to compare these figures, but it’s important. If a marketing campaign brings in $500, it doesn’t make sense to continue the campaign if it cost you $2,000 to run. The key to being profitable is generating a profit over the cost of goods or services and marketing. The only way you can ensure profitability is to calculate your ROI and discontinue non-profitable marketing efforts.
If you just ran a big marketing campaign and saw a sales spike, there’s a good chance that the campaign worked. If you’ve only added one type of campaign, it can be easy to attribute the increase in sales to that campaign. However, if you kick off a number of campaigns at the same time, this can be a less reliable method, as you won’t be able to attribute sales to a specific campaign.
Compare to Competitors
You can also get a general sense of how your marketing strategy is doing by comparing your company’s results to competitors. While you can’t necessarily know exactly how a competitor’s marketing efforts translate into paid customers, you can get a general sense of how they’re doing. You can see how they market their business by viewing what they do on social media, signing up for their email subscription, downloading their lead magnets, and doing searches for their company name on search engines. You can see if competitors rank higher in search engine results, and how often they update their blogs.
It is possible to only pay for the marketing strategies that yield the most results. By using these strategies to evaluate your marketing campaigns, you’ll know which ones work. You can discontinue the procedures that fail to perform or modify them to improve performance.