Tuesday, June 16, 2009

How Do You Measure Your Marketing?

You have 5 new clients this month and you're ecstatic and pleased as punch. You've been doing all sorts of marketing but who knows where the heck these new clients came from?
Maybe it's from your expensive advertisement in that monthly magazine? Could it be from your email newsletter that was passed around by one of your clients? Or, it might be from that talk you gave a few months back.

You should be measuring your marketing so that you know where you get the most bang for your buck.

How do you measure your marketing?

Here's how:

1. Start asking your new clients where they found out about you. Run a sales report either annually or semi annually and figure out where your income came from.

2. Create an Excel spreadsheet. One sheet for each year.

3. On the horizontal axis, create a column each of the following:

Name of Marketing Activity
Cost Annually
Annual Revenue from the Activity
Return on Investment (revenue divided by cost)
What you like or get out of the activity other than revenue
What you dislike about the activity
Time commitment ranked from 1-10
Future potential from 1-10
Percentage of your total income from this marketing activity

4. On the vertical axis, create a line for each marketing activity such as:

Specific networking groups
Email Newsletter
Article Writing
Public Speaking
Video Marketing

5. Analyze where your revenue came from last year

Are there any surprises?
Are you really getting a return on investment where you thought you would?
What are the most expensive marketing activities?
Where could you double your efforts to double your revenue?
Which one marketing activity is responsible for your source of biggest revenue

Don't just blindly throw money at your marketing. You need to know what works and where you should do more. You should also consider those activities that are more fun or rewarding than others.

For example, although it's costly and time consuming to belong to my local Financial Planning Association, the benefits I get are huge. I get to listen to speakers who address my target clients' biggest issues. And I'm right there talking to my Ideal Clients – financial advisors - a very worthwhile investment indeed. If you're not measuring your marketing, start today. You'll be glad you did.

If you'd like a sample excel spreadsheet like the one explained above, please submit a comment about how you currently measure your marketing and I will email you the spreadsheet.

Suzanne Muusers
Business Coach for Entrepreneurs and Financial Advisors


Anonymous said...

Hi Suzanne,

I work for a small consulting firm in London that helps entrepreneurs of technology companies increase their revenues. We get involved in executing high-value sales, establishing channel partnerships, and all the strategic and operational work that enables those deals.

Something we developed to measure marketing was the idea to keep track of what we call a Lead Diversity Index.

In essence this is the number of new leads multiplied by the number of lead sources^2 (squared). So we put more emphasis on the number of different sources that are working than the number of leads. We assume that once they are working at all they can be scaled up.

By tracking this Index on a monthly basis we get a good idea of how our clients' lead generation programmes are performing.

Paul Higgins
Rapid Innovation Group

Anonymous said...

Hi Suzanne,

Thank you so much for the helpful information. I often wonder how to even begin tracking this and you have made it very simple.

I look forward to reading how others track their marketing efforts.

Miss Details Design

Unknown said...

What a wonderful way to look at marketing. As a numbers person, I struggle to understand marketing and how to value the different strategies. A quantitative approach is just what I need.

I wonder, however, what to do when a contact is made at a seminar I taught, then "warmed" by my newsletter, then pushed by a referral -- which strategy does that get counted under? Public speaking, Newsletter, or Referral?

Deb Howard Greenleaf
Greenleaf Virtual Accounting

Suzanne Muusers said...

Hi Deb,
I always look at where the contact was originally made. Your newsletters just serve to keep the contact in your pipeline.