What's The Score
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Entrepreneurs know it's important to track their advertising efforts, but most don't do it. They assume it's too time-consuming or complex. Instead they rely on gut instinct and unsubstantiated information. But a good tracking system replaces conjecture with facts and enables you to make sound decisions based on reality. The system doesn't need to be complicated--it only needs to be used.
Don't wait until after you've placed an ad to set up a system to measure its effectiveness. Plan how you'll measure success whenever you're considering a particular marketing strategy. First decide what you need to know: What's the cost of each new customer you attract through a Yellow Pages ad? Does it pay to give away promotional gifts? Different situations demand different analysis, but every ad demands follow-up and evaluation.
How you keep track depends on the marketing activity you want to assess. Consider the following:
- Yellow Pages ads. Set up a separate phone line to include in the ad or list an extension with your regular phone number. Anyone who asks for the extension has seen the ad.
- Direct mail. Imprint codes on all your promotional materials. When customers call or return a form, note the code.
- Radio/television. Make offers valid only "if you mention you heard this ad." Always ask first-time customers how they heard about you and keep track of their responses.
"For many businesses, tracking is as simple as putting data into a computer. For others, it's a combination of manual systems, computer data, surveys and periodic analysis of accounting data," says David J. Sternberg, a marketing consultant in Hoffman Estates, Illinois, and author of The Internal Marketing Manual (Internal Marketing Solutions Inc., $149, 847-884-1120).
No matter what kind of tracking system you set up, Sternberg suggests you follow these guidelines:
- Accuracy. "If your tracking system isn't 100-percent accurate, you might make decisions based on the wrong facts," he says.
- Consistency. Be sure the same data is entered for every contact.
- Ease. The simpler the tracking system, the more likely you are to use it. Try tracking just one or two aspects initially, adding more when you begin to see results.
"One of the techniques that works best for me is setting up makeover sessions for targeted groups," says Gene Martin, owner of Gene Martin Salon, a beauty salon in Pasadena, California. "The names of attendees who sign up for a drawing are entered into my database along with the name and date of the event. When a woman makes an appointment, even if it's months later, I can link her to a specific group. Because I track the results of these events, I know I convert 60 percent of those who attend into clients."
Remember, the goal of tracking is to learn whether your advertising is worth the money. There's only one way to know if a campaign is worthwhile: Establish a goal and assess the results.
For instance, you buy a quarter-page ad offering 50 cents off a latte at your coffee stand. To pay for the ad, you've got to sell 1,500 cups. Sell 1,700, and the ad's a winner. Sell only 750, and it may be a dud.
Base your ad purchasing decisions on bottom-line concerns and measure the results. You'll save money and learn what advertising methods work best for your business.
Get On Track
There are a number of additional resources you can use to help track your advertising efforts:
- Search for appropriate shareware online. Two good database-tracking tools are Ad Tracker 2.0 for Windows and Ad Tracker 1.0 for Macintosh. The first is available at the Small Business Administration's Web site (http://www.sbaonline.sba.gov/shareware ); the second is available in FileMaker 3.0 format on America Online (Under the "GoTo" menu, click on Search Software Libraries. In the next screen, type in "Ad Tracker" and hit enter.).
- The Buck Starts Here: Profit-Based Sales and Marketing Made Easy, by Mary A. Molloy and Michael K. Molloy (International Thomson Publishing, $23.95, 800-865-5840). This book provides tools to evaluate the effectiveness of your current sales and marketing programs.