What is Your Marketing Doing For Your Bottom Line?
No matter what type of business you have, whether it is product based, service based, online or traditional bricks
and mortar, it is critical to ensure that you are tracking your return on investment for marketing dollars spent.
Traditionally, the larger organisations have put in place systems to ensure that every dollar spent on sales and
marketing is tracked in every way possible. On the other hand however, often small to medium businesses spend
ample amounts on marketing but do not have a refined idea of what their return on investment really is. As a
result, many businesses scrap their marketing efforts all together and note down previous efforts as “time and
So, what is the solution?
First and foremost, ensure you keep track of every expenditure needed to create and market your products and
Although the equation for calculating ROI is Gross Incomes less Marketing Investment, divided by that same
marketing investment, that is not enough to know that your marketing spend is valuable. You need to be able to
track the individual result of each and every marketing initiative so to be able to ensure that further marketing
initiatives are tailored to specific target audiences and any under-performing initiatives are not re-used.
Let’s go through a real-life example.
A client of ours in the women’s accessories retail sector recently found us and asked us to create a marketing
campaign for her. As with all new clients, there are certain questions that we ask before beginning any type of
marketing. One of these questions is of course ‘what marketing have you previously done and what were the
results?’ The answer we received was “we have advertised in Cosmo, in local newspapers, on websites and in
Cleo magazine in the last 3 months”, there was no mention of what the actual results were. When prompted the
client looked at us with a puzzled expression and simply said “well, we made sales during that period, so I
assumed they worked…right?”.
What can we take from that?
Firstly, the client tried to do all of the right things and was looking to target specific audiences which is evident in
advertising in Cosmo & Cleo – tick for that one
The client had no idea how much was spent in total, let alone in each area
All were done mostly concurrently and none were tracked on their own merit
It doesn’t seem like there were any goals set in place to how many sales would produce a positive benefit for the
Out of the four take-aways above, only 1 was a positive, so clearer we are not headed done a good path.
Once we took over the campaign, we tested all of the same advertising (bar a few irrelevant/obsolete avenues)
and the outcome was completely unexpected by the client. We found that out of 8 possible marketing avenues,
when tracked on their own merits, only one brought in over 82% of all traffic sources and over 75% of actual
purchases, rendering the others inadequate in comparison when calculating the ROI.
What to Remember from the above:
It is important that you track all of your marketing initiatives separately and on their own merits
Ensure that you have a goal for what you expect each initiative to achieve so that you have something to
compare the actual results to
It is fine to run many campaigns all at one, however ensure that you have a system in place that allows you to
ensure that you know where customers have come from (e.g. if your campaign is online, ensure you have a
different tracking code for each different website)
Every month, quarterly, yearly etc depending on your business and your goals, ensure you evaluate each and
every marketing initiative compared to other avenues and expected results. Only then will you be able to achieve
a highly targeted and effective marketing campaign
If you have any questions regarding this or anything else marketing, please contact us via our contact form on