The Payback: Your Return on Investment

Six creative ways to ensure the most bang for your advertising buck

By Erinn Morgan

Are you tracking your ad dollars' return on investment (ROI)? Following the success of your marketing plan is key to determining what works best for you and your business.

"Testing is good—make a little investment in different advertising mediums and track what works best for you," says Mike Gatti, executive director of the Retail Advertising and Marketing Association (RAMA), a division of the National Retail Federation.

TRACKING PAYS

Learning to utilize inventive strategies to measure your advertising's effectiveness pays off. This process can become an ongoing one that constantly helps you fine-tune your marketing plan. "You want to be consistently trying to figure out what's working best for you so you can adapt and change on a dime," says Lisa Duncan, retail consultant and president of Duncan & Duncan Associates. "You may find that yesterday this great thing worked, but today it's something completely different. The (businesses that) adapt and change are the successful ones."

While certain advertising media (such as coupons printed in newspapers or clicks on website banner ads) are very track-able, others (such as radio and television ads) call for creative tracking measures.

Read on for six key strategies that can help you assess how much return you are getting for your advertising investment.

RUN COUPONS

In today's economy, coupons and discount-oriented advertisements (also called "price action" ads) have become great tools to draw price-conscious customers in the door.

"Put them in the local newspapers, on your website, or hand them out in shopping bags to customers," suggests Martin Lehman, the New York City-based marketing director and counselor for SCORE, a counseling service for retailers.

He adds that retailers can keep track of their coupon ads' effectiveness by collecting them when customers come in and pay using the coupon.

"Start to add them up and you'll get a feeling if it's working," Lehman says. "If you run the coupon on your website, you can also track the hits on your site's coupon page during the promotion."

OFFER FREEBIES

Akin to the coupon strategy is a promotion where businesses advertise a free service or gift to those customers who mention that they heard or saw your ad on the radio or on television. This can be helpful for non-print advertising media where coupons are not feasible.

"The ad could suggest they come in and have a free tune-up on their frames when they mention your ad," says Lehman. The dispensary staff can keep a running tally of the people who come in for this service to help track the ad campaign's ROI.

MEASURE FOOT TRAFFIC

This creative method for tracking ROI employs an inexpensive traffic counter installed in the store.

"A lot of retailers measure foot traffic at the same time they run their ad," says Gatti, who also notes that measuring traffic before the ad campaign will determine your average amount of foot traffic. "We know that increased foot traffic increases sales, so businesses can confirm their ad's effectiveness with a noted bump in sales, number of transactions, and even average transaction size.

EMPLOY YOUR STAFF

Getting your dispensary staff on board with tracking ROI is one surefire key to success.

"It's important to constantly give your staff training on how you want to track ROI," says Duncan.

She suggests that the staff members always greet customers and say, "It's great to see you. How did you hear about us?"

The results of this conversation can be written down on a list at the register, a notepad the staff member is carrying, or on a bulletin board in the back room.

Incentive programs and contests for the employee with the most answers each week will encourage staff to keep the information flowing in. Award a free lunch or a gift card to the person with the most answers every week.

LOOK TO THE WEB

Online advertising offers one of the most concrete ways to track advertising ROI. "It's very easy to track clicks on website banner ads to determine ROI," says Gatti.

ECPs can also track how their own websites drive traffic into stores by running promotions or coupons on the site. Practices can even run a print or radio ad that leads consumers to their website.

"You could suggest they print out a coupon or take a discount code off the website and use it in the store," says Gatti.

MEASURE BRANDING

Looking to track your long-term investment in a lengthy or ongoing advertising campaign?

"If you are really doing a sustained branding campaign and want to determine top-of-line awareness, you could conduct a phone survey with customers or consumers in your area before the campaign and then again after running it to see if awareness of your brand and business increased," says Gatti.

This type of survey could also be done via email. Adds Gatti, "You could also ask customers to rate you against other local businesses and see if your company went further up in pecking order of companies after running the ad campaign." EB