Mastering Advertising Metrics and Calculating ROI for Vehicle Wraps
A small business owner without a marketing or advertising background can find themselves in quite the quandary when figuring out advertising metrics and the return on investment (ROI) for advertising campaigns. Browse the Internet for “advertising metrics” and you’ll find topics from the easy to understand to the very complex.
Still, advertising and marketing metrics and the principle behind them haven’t changed that much even with the insurgence of Google Adwords and free and paid ad and CRM tracking software.
All advertising campaigns have three basic metrics marketing professionals rely on—they are the heart and soul of any ad campaign, whether your ads are online or you are using traditional advertising methods such as print, radio, television or outdoor displays (billboards).
Let's look at the three must-have ad metrics.
1. Ad Must Be Creative
First, the ad itself must be creative. How creative? I remember a long time ago, before Internet ads were all the rage, I was reading the newspaper one day and a side ad caught my attention. In big bold letters the ad read “Wife Wanted.” Under this mysterious ad heading was the actual ad—words in smaller print offered sewing machine repair services. Did this ad work? It got my attention! I may not have needed sewing machine repair but the creativity of the ad is what made me look at the ad.
The advertising metric is the first part of any campaign. You can create an ad campaign on your own but be sure to review online and offline ads of your competitors and find some originality.
2. Target Reach
The second advertising metric is who you want to reach with your ad. The “reach” can vary depending upon the campaign. If you sell a specialty line of clothing for babies, teenagers and young adults, the campaign should focus specifically on the age group you are trying to reach based on the ad/sale/special/discount. You can try and reach all three but the more you define your target the better the results will be.
Inc.com offers a great article on “How to Define Your Target Market” by Mandy Porta. The article is a great place to determine your target reach by first defining your business and includes tips on analyzing your own customers, the competitor’s reach, and the products or service you sell to target the right demographics.
3. Ad Frequency
Finally, the third advertising metric, frequency, is how long your ad campaign will be and which advertising venues you want to use. Obviously the frequency depends upon the goals of your ad strategy. A new business grand opening will have a different frequency than a one-time holiday special ad campaign and so on. New entrepreneurs should work on where, when and how long they’ll advertise a new opening in the startup phase of the business. A party store offering party supplies and accessories should focus their ad campaigns before holiday seasons begin and but also remain a constant throughout the year; i.e. “You used us for Halloween but we’re here for your birthday party needs too!”
No method of advertising is 100 percent free. Even if you blog everyday about what you sell or service and use the right keywords and search engine optimization (SEO) tools you still have “time” invested and time is money.
Simply put, the return on investment (ROI) for any advertising campaign is calculated this way:
ROI = (Gain - Cost) / Cost
Let’s say you’ve decided to place a two-page color weekly ad in your local newspaper for one month and that campaign costs you $50,000. After tracking the ad responses, you determine this specific ad campaign generated $600,000 in sales and from those sales you achieved a gross profit of $200,000. You would calculate your ROI this way
($200,000 minus $50,000) divided by $50,000 = 3 = 300 percent
Because ROI is calculated as a percentage, the ROI calculation above shows for each dollar you spent on the two-page color newspaper ad you generated three dollars of profit.
On the other hand, traditional ad methods such as print mediums and radio and television may not offer the number of visual impressions you need to offset the expense of the ad. The above calculation is an example but using traditional ad venues isn’t always your best bet for advertising strategies and campaigns.
No matter how “creative” your ad is, if you aren’t “reaching the target” with the right amount of “frequency” your ad campaign will fail and the ad dollars you spent are wasted.
24/7 Moving Billboard Vehicle Wraps Advertising
Because Sunrise Signs is in the vehicle wraps advertising business, we’ve created a free Vehicle Wrap ROI Calculator to show you exactly how much your vehicle graphics and wraps ad campaign will cost compared to traditional ad methods.
Vehicle wraps, fleet wraps and franchise wraps are a one-time investment type of ad strategy, are 100 percent removable and last up to five years. They can also offer anywhere from 30,000 to 70,000 visual impressions per day—a lot more than a newspaper ad; there’s a reason so many newspapers are going under—no ad revenue!
We have shown our clients time and time again how much more affordable vehicle wraps advertising can be for them—wrap advertising is a smart way to get your message and brand across to your target market.
Vehicle wraps also include the three advertising metrics seasoned professionals rely on: Creativity (each vehicle wrap is custom and unique), Target Reach (they’re more of the target finds you in an efficient and tried and true manner) and Frequency (impressions can be vast depending on how long the vehicle is out on the road).
Before you start any ad campaign, make sure you consider the three metrics of advertising and understand they are the core of all marketing efforts. Next, after you’ve analyzed how much you’ll need to spend on newspaper, television, radio and display advertisements, why not contact us to see how we can turn your company vehicle(s) into a 24/7 moving advertisement—a smarter ad investment!
As far as ad tracking goes, you can do it on your own with a spreadsheet or head to cloud CRM and watch a free demo of SalesForce. It’s a popular software program even for those new to CRM and sales lead tracking.
Special thanks to Wordle for the free creation of the Infographics in this article. Stuck on ad ideas? Wordle.net is a good way to type in some text about your product or service to create an infographic based on the words provided and is a great way to get your creative ad juices flowing.