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What You Can Measure You Can Manage

This information is designed to give you insight into just how important tracking the results of your marketing could be to your future marketing and, ultimately, to your profitability.

Measuring and monitoring your results gives you greater control over your marketing and the techniques you are using. Further, it usually means better use of your marketing budget. Here, you’ll discover some easy ways to properly measure and monitor your results.

Measure, monitor, and test (and some examples for you)

3 little words with so much power.

You can have a great product or service, you can have the very best advertising and method in the world, and your support and service may be supreme. But you will never reach your optimum performance unless you master the art of measuring, monitoring, and testing.

Without the ability to measure what is happening to your ads and offers, you cannot monitor what is occurring. And without testing, you may either let the best idea you ever had slip away, or you may spend a fortune on an ad you should have known was not going to work long before you started.

So for any system to be complete, you need to build in these 3 elements—measure, monitor, and test.

Let’s begin with measurement. All your advertising and acquisition mechanisms must have a built-in measurement device, for example, a code unique to the ad, headline, offer, or guarantee. The reason for making it a unique item is that you then have a device to allow you not only to measure based on the number of responses, but also to specifically focus in on which ad, or run, or medium worked best.

To examine this further, look at the next ad. It has 2 possible measurement devices: a toll-free number and a measurable offer document. 

Measurement Devices

There are several other options you can use to measure, monitor, and test. Here are just 4 more:

Here’s another example. Can you spot the measurement opportunities?

How did you do? Let’s discuss the possibilities.

• You could measure the number of people who are requesting the 10% discount. To make the voucher even better, use a “Sunset Clause.” That is, set a clear expiration date to get people to call now rather than later.

• You could implement a manual system to ask people (whether they phone or drop by) where they heard of you. It should be used all the time, but good triggers would be those people who ask about the ‘Free Quote’ or 10% discount.

• You could measure the number of people who take you up on the offer of a ‘Free Color Consultation.’

• You could measure the number of incoming coupons that have the code in the top left-hand corner.

Two other areas are very important to think about.

1. You should only focus on one measurement tool for each venture. If you have an ad like the previous one, you need to decide which measurement tool will be most effective and most easily monitored. Then institute a system to make sure it’s measure effectively and accurately every time.

2. There is a critical second stage to your measurement. The first point of measurement is the actual lead—how may times the phone rings, how many vouchers come in, how many reports are dispatched, and so on. The next phase is to measure the actual conversion to sales.

It’s one thing to get inquiries. It’s quite another to get them from the target market. An offer that works is not necessarily the one that makes the phone ring the most often. An offer that really works is the one that, at the end of the day, sells the most products or services.

So to accurately measure what’s going on, you not only need to track calls or offer requests, you must also monitor them through to a final conversion to sale. And the process continues as you measure the frequency of contact with the clients, whether they refer like clients, and so on.

Counting the initial number of leads is just step one in a system of measurements.

Let’s recap briefly.

• Without a measurement system in place, you cannot expect to have data to show you the effectiveness of your advertising and marketing dollars. You won’t be able to establish whether a $1,000 investment in a marketing venture is wise money or simply a waste of your hard-earned dollars.

• Several different types of mechanisms can be used to measure an offer’s effectiveness. The secret is to decide which one you will measure and do it every time. 

• When you have faith that every lead has been captured, you can accurately monitor the success of the project.

• Once you have the initial lead, the job is not done. You need to monitor through to actual sales before you can be satisfied that the lead was a good one.

• If an ad, offer, or other marketing tool gets a lot of inquiries but rarely converts to a sale, you need to look at a few things. Is the medium right? Is your offer working or does it only attract ‘tire kickers’? Should you test another headline? Are you above the price point? Are you below the price point? Does the offer correctly portray your market position? And so on. 

• If a method has high volume/low conversion, you need to ask yourself a few questions like those above, then tweak the offer and retest. 

That raises a good point—testing. How do you do it? Why do you do it? What mediums can you use? Is it worth the time and money?

Testing is an integral part of any marketing effort. Many a business has failed because they forgot to test. For instance, launching a new product without proper market testing and feedback. Or spending an exorbitant amount of money on a campaign, say telemarketing or a huge offer campaign, without testing the market and method on a small group first.

Many businesses stumbled into a great new area, market, or product because they tested. They took something interesting and spent a little time and effort to sample the reaction of a small group of possible customers. If it doesn’t work, they’ve hardly lost a thing. If it does, they may have gained a lot for little risk.

So how do you run a test? Let’s say you have this next offer planned for a magazine, but it will cost $11,000. You may decide to test the ad first. There are a few possible mediums. Let’s say you choose 300 names from a list that deals only with your target market—young professionals.

You could test the ad by sending the offer to your target market and monitoring the response. Remember, we’re measuring a few things: (1) How many inquiries does it generate? (2) How many progressed to a sale? (3) If they don’t progress to a sale, do we know why? And so on.

Or you may decide to use a medium that’s more in line with your final plan for the ad. For instance, if the full run will be in a newspaper or magazine, it may be worth testing in the same or similar medium if a low-cost option is available. Local newspapers, for example, may charge a few hundred dollars versus a few thousand in the larger metropolitan papers or targeted magazine.

Again, measure the response as described above. You may decide to test 2 runs—either a week later in the same medium or a split run in the paper in the same issue. Or else you could look at splitting a small group in half, say your 300 young professionals. 

Then try another offer and test the difference in the results. Remember to use a unique measurement tool as discussed earlier. Here’s what your other ad might look like:

By running the revised version of the original ad, you’ll be able to ascertain whether a particular headline brings better results. Notice that there’s a different phone number to ensure that you’re accurately measuring the difference between the two.

To measure that, you could do a few different things:

• You could have the phone company monitor the number of calls and the areas they come from. Then have your own system to follow each call through to a sale.

• You could physically record each incoming call and sale made through a given line, as shown below. 

New Digital Deal…          1-800-123-456

SAVE $250 …     1-800-123-555

Here’s another example. Two ads were run for the same gym. Can you guess which one was more successful? Which do you think worked best? Two different positionings were used: On one hand, you’re going to save $200 and get Free Slide Reebok workouts; on the other, you’ll get trim, taut, and terrific for as little as $1 a day. It turns out the 

market preferred to invest just $29.95 a month. How did you do?

There you have it. As you can see, offers can be a particularly useful tool for both your own practice as well as for your clients.

Remember, the offer is just the beginning of the process. Once you develop a basic offer, you need to fine-tune the details. For instance, how will you test it? What measurement device will you incorporate? And so on. Once you’ve decided these things, you need to incorporate the measurement device into your offer piece.

From there, you will, of course, look at developing the internal systems to back up your offer. Developing forms to collate data or arranging toll-free phone lines and PO boxes for data collection. When these things are in place, you can educate your team. People drive the systems, so they must be informed and they need to understand the process.

Then your test is underway. You can sit back and wait, watch, and measure. After you assess the data from your test, you can make any necessary changes to the system before rolling out the real deal. 

So, is advertising and marketing really worth it?

Frankly, you will only ever know if you measure, monitor, and test.

If an ad will cost you $100, $1,000, $10,000, or more, it might seem expensive. However, if you knew the ad would bring in $200, $2,000 or $20,000 in sales, you might not view that advertisement or marketing piece as a cost so much as an investment.

Suddenly a $10,000 ad that on average brings in $20,000 or $30,000 in sales (you know that because you’ve tested it), it certainly would be worth it. Particularly when you consider the value of your customers over time. That ad may reap only $20,000 or $30,000 in initial sales, but what about all the follow-on income when your customers buy from you again and again? Surely you’d be able to add at least another $10,000 to $20,000 attributable to that ad.

Then again, if you fail to measure the results of an ad or campaign, how will you know if the money was well spent? You wouldn’t, except by guesswork. What if the business you think the ad is bringing in is really coming from somewhere else? Referrals for example. That can be expensive. You might end up continuing to invest in an ad that isn’t working at all, throwing away your hard-earned money.

So, is it worth it? Depends on the return it brings. And you can only judge the return a piece brings by measuring, monitoring, and continually testing.

Now, just imagine you knew—once again because you’ve tested—that a particular ad brings in a particular amount of sales each time you run it. Budgeting would be easier, wouldn’t it? You’d know how to map out your cash flow around those campaigns. Projecting sales and planning production or staffing is suddenly easier, too. Why? Because you know to a degree of certainty what will happen next. So you can see the huge benefit. Go ahead…test these ideas!

Your Action Plan: Reap greater rewards from your marketing investment by measuring, monitoring, and testing