Measuring Advertising Returns

This blog is about advertising returns, in particular gauging the efficacy of different types of advertising campaigns. It was inspired by the questions asked me by a client seeking to understand how retailers and advertising agencies view payback on ad investment through different advertising vehicles.

We began with catalogs. Now catalogs are typically considered to be a “lower funnel” or direct advertising tool. While a well-done catalog can positively impact brand perception and equity and can stimulate upper funnel results such as awareness, interest and desire, most catalogs are judged on tangible results.

What then are the tangible results we are looking for? A smart marketer will begin his or her campaign with that question, rather than measuring them after the fact. In direct marketing, these are referred to as Key Performance Indicators, or KPIs. In the case of a retail catalog, these KPIs will reflect specific desirable consumer actions such as: making a purchase, visiting a website, returning a business reply mailer, signing up for a mailing list. Most enticing, of course, is sales volume.

How then, do we link consumer activity to a particular catalog mailing? There are a number of tactics that can be used. Here are some examples:

1. Create and include a dedicated telesales phone number for each catalog.

2. Send catalogs to different geographic areas on different dates. Then keep an eye on traffic and spending, in store and online, during those periods in those geographies. The geography of an online shopper can be estimated based on the user’s IP address. (An Internet Protocol (IP) address is a numerical label that is assigned to devices participating in a computer network that uses the Internet Protocol for communication between its nodes.)

3. More to come…

I welcome your thoughts!

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