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How to measure the effectiveness of advertising?

How to measure the effectiveness of advertising?


The effectiveness of advertising. How to explain to the head?

You are a marketer, and he is a manager. When you talk about advertising, it seems that you are from different planets. One advocates a gradual increase in awareness, building up a loyal audience, another needs a sharp increase in sales here and now.

How is advertising effectiveness measured? How to understand that we have not spent money in vain?

The effectiveness of advertising is financial and communicative.

Financial is measured in money or "additional turnover", how much we earned in excess of what was due to advertising? To make calculations, it is necessary to possess accounting information - “how much was” and “how much has become”

The formula is quite simple - we count TD (additional goods turnover) - how much we earned extra, i.e. additional revenue for the period of the advertising campaign, rub.

So TD = (TS * P% * D) / 100

Where TS is the average turnover before the start of the advertising campaign, rub.

P - the average increase in turnover per day in% in the period of the Republic of Kazakhstan compared to the pre-advertising period

 D - the number of days that we take into account

The number of days may not coincide with the promotional period and exceed it, because some goods and services have the so-called “pent-up demand”, it takes a long time to make a decision about the purchase (expensive goods, equipment, real estate, cars, etc.)

As a result of calculations, we obtain how much money was earned by advertising in excess of the amount that was usually earned when advertising was not given.

Further, it is possible to calculate such indicators as net profit, an increase in the average check, and whether the advertising campaign paid off.

But the most important indicator of advertising effectiveness is communicative efficiency.

Advertising acts as a social motivation, i.e. awakens in people the desire to like others, make an impression, stand out. So advertising controls the behavior, and not only shows the goods from the best side.

Evaluation of communicative efficiency - an assessment of the degree of attraction of the attention of your potential buyers / clients, the richness and depth of their impressions.

How to measure?

Here you will come to the aid of questionnaires, online questioning in social networks, the number of advertisements added to the bookmarks, the increase in subscribers, their comments, tear-off coupons, collecting chips, promotional codes - everything that makes your client take the initiative: remember will confirm, will return to the point of sale or give feedback online. Practice shows that increasing communicative efficiency automatically increases financial efficiency (!). And thanks to the gadgets and the Internet, you can track the consumer mood without leaving your home. Everything is simple

- we launch an advertising message with a promo code in the social. networks or Yandex Direct through a convenient platform

 - see feedback –views / questions / comments / order of goods / subscriptions / likes /

- here we can order the creation of a questionnaire and evaluate the effectiveness.

Last tip:

So that, at the end of the advertising campaign, there are no hot spots for local office conflicts, determine in advance the goal of the advertising campaign with the manager. Simply put, what do you expect from advertising? Write it in CAPITAL LETTERS on the board to avoid misunderstandings. After the advertising campaign, you will approach the board and answer the question “have we achieved this goal (by how many%) or not?” If yes, RK was effective, if not, we need to revise all aspects in detail, make the necessary adjustments.