Measuring the Success of Your Promotional Campaign:
Running a promotion, such as a discount, coupon, or promotion, is a great way to increase interest in your products and encourage purchases that you wouldn’t otherwise have gotten. These efforts not only attract new customers to your brand but can also encourage the return of previous customers. However, when determining the success of a promotion, many entrepreneurs tend to focus on one criterion rather than looking at the whole picture. Below, we’ve discussed several ways to determine your recent campaign performance.
Before it starts
Record the average number of new purchases, website traffic, and sales volume you see during the time you use the promotion to run promotional campaigns. This data is a valuable reference for comparing your rates during and after the promotion.
You should also calculate your break-even point so that you can see how your promotion is doing at certain points in your career. This information can help you decide if you need to adapt your work strategy.
Calculate the breakpoint using this formula:
Break-even = total costs of the campaign by product
Return on investment
The most commonly used metric to track the effectiveness of a promotional campaign is the return on investment or ROI. This measure indicates how profitable your campaign was. Use the following formula to determine your ROI:
ROI = (total money earned – total campaign cost) ÷ total campaign cost) x 100
Let’s say you run a promotional campaign for one of your products and earn a total of $ 1,000 after spending $ 500 on promotional material. Your calculation will look like this:
((1000 – 500) 500) x 100 = 100%
Since you spend twice as much to get your product, the return on investment is 100%.
Another important metric to monitor is the number of people who have actually taken advantage of your offer or sales. Show how attractive the discount was to your customers. You can find your redemption rate using the same conversion rate formula:
Redemption rate = (number of times the promotion was redeemed ÷ number of people who viewed the promotion) x 100
Let’s say you’ve sent a discount code to your email marketing list. If 3000 people see the email and the discount code is used 600 times, your calculation will look like this:
(600 3000) x 100 = 20%
This indicates that your promotion had a 20% conversion or redemption rate.
New promotional customers
One metric that can often be useful is the number of new customers who get the promotion. While it is always possible for new customers who win promotion to search for offers, it is still a good idea to enter their email address so that you can contact them for future marketing initiatives.
Obtaining certain data for this calculation can be a complicated or manual process; However, you can find the number of new customers you have acquired through your promotion using this formula:
% of new customers in the promotion = (number of new email addresses used by the promotion ÷ total number of new email addresses in the promotion period) x 100
Let’s say you offered a one-month discount promotion and received 500 new email addresses during the period. If 350 of these email addresses meet the criteria for your discount, your calculation will look like this:
(350 ÷ 500) x 100 = 70%
This indicates that 70% of the new customers acquired during the promotion round were likely acquired as a result of the promotion.
grow with new customers
You can also compare the total number of new email addresses acquired during the promotion against your benchmark to see if there is an overall increase in new customers. This can be found using the percentage increase formula. For new customers, the formula looks like this:
% increase in new customers = ((Number of new customers – benchmark) ÷ benchmark) x 100
Let’s say you generally earn 50 new customers per week (your referral), but the week you run a promotion, you earn 75. Your calculation will look like this:
((75 – 50) 50) x 100 = 50%
This indicates that your company experienced a 50% increase in new customers during the promotion.
Increase in sales
The percentage increase formula can be applied to many different parts of your business, including tracking your sales during a promotion. Use the following formula to specifically determine the percentage increase in sales:
% sales increase = ((number of new sales – benchmark) ÷ benchmark) x 100
Suppose, before running a monthly promotion, you determined that the 200-month sales measure is 200. If you had 275 sales during the promotion month, calculate the percentage increase in sales as follows:
((275 – 200) 200) x 100 = 37.5%
This shows that your company had a 37.5% increase in sales as a result of your promotion for one month.
Increase in website traffic
Another area where the percentage increase formula can be useful is website traffic. This is especially useful if you’ve spent a lot of money on advertising and marketing efforts outside of your website and existing email list. Use the following formula to determine the percentage increase in website traffic over a period of time:
% increase in website traffic = ((number of website visitors – criterion) ÷ criterion) x 100
Suppose you normally see 12,000 visitors per month, but in the month you run a promotion, you see 17,000 visitors. Your calculation will look like this:
((17,000 – 12,000) 12,000) x 100 = 41.67%
This means you are earning a 41.67% increase in the month you launched your promotional campaign.
There are many other metrics that can be helpful in determining which aspects of your promotional campaign have been successful. Is your business already generating buzz online? Track the amount of buzz before and during the campaign using Google Alerts, Twitter citations, and other features to see how the frequency of online buzz increases. Did the order size increase during the promotion? This could indicate that your offer encourages customers to buy more than they normally intended or bought. Was the number of sales that did not use the promotion greater than normal? This could indicate that customers who have not reached their bidding limit may still find products on your site that have piqued their interest.
While ROI is an important measure of your promotion’s performance, there are many other success stats you can use to get insights into your business. After compiling a list of statistics for different aspects of your business, you can determine which types of promotions have been beneficial (or harmful) for each of them and determine future goals and promotion strategies accordingly.