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Measuring Your Marketing Efforts

Deborah Rechnitz, CMA, CMC |

As you know, marketing is not a pure science. It involves the interplay of the psychology of your consumer at the moment combined with factors outside of your control, blended with timing, presentation, distribution and budget. It is a combination of creativity, tenacity, fortitude and trust.
At the end of the day, you struggle with these factors and hope for a successful outcome. Knowing how well you did based on your original intentions will help you in future campaigns. Companies don’t always do this, but some of the most successful businesses in the industry do.
The first step in moving from “wishing for the best” to managing the best outcome is to decide on your campaign’s purpose. There are four major goals any marketing campaign in this industry will follow. Each requires a different approach, message, pricepoint and timing. Each also requires a different means of measuring its success.1. Building Name Recognition. “Institutional” advertising is designed to build name recognition. Keep your name in front of customers and prospects, and they’ll think of it when they need your services. Cleaners often avoid this type of marketing, since it has no immediate, quantifiable return.
However, in the long run it can be of huge benefit, and you may be missing out on an opportunity. For example, one drycleaner did television ads for the drapery side of its business, but never advertised drycleaning on TV. When it later surveyed new drycleaning customers to ask how they heard about the company, it discovered that it was the television ads which usually brought customers in.
The information resulted in a change in strategy, but only after measuring returns and determining the meaning of the results. If institutional advertising’s purpose is to build name recognition in the community, that name recognition must be measured.
This generally involves a survey. Sometimes, it will be conducted by local newspapers who do “Top 10” or “Top Picks” surveys of readers. If you come in No. 1, at least your name is familiar to readers. It doesn’t say whether they think you do a good job or they think they would go to you if they needed something cleaned, only that your name is most familiar. It’s a start.
There are companies that do only surveys, taking a representative sample to learn more about how your company is perceived by users and non-users. This information can be used to build your ongoing campaigns.2. Bringing in New Customers. There are lots of good ideas on how to build a list of prospects, how to contact these prospects and how to entice them to try your services. The struggle is in deciding which idea is best for you, what has the greatest success rate, and how you might make a campaign better. Without good measurements of existing campaigns, you can’t adjust or modify previous ones with any confidence.
A new customer is now easier to identify than ever before. Point-of-sale (POS) systems inform employees immediately if a particular person is not in the computer system. This information should initiate a series of steps that ask the customer, “So how did you find us?” But it isn’t enough to stop there.
The next step is to track these answers. Some of the answers will be obvious—“I saw your sign,” “I was referred by a friend,” “I brought in your coupon.” Keep track of the results, and you’ll know which coupon brought in the most new customers and which one brought in the least, and whether word-of-mouth is your greatest asset.3. Expanding Existing business. The strategy here is similar to the one for tracking prospects: Try different things constantly. Some will work better than others. Some will work today, but not next month. It is a process of evaluation and management; without good information, it is a guessing game that will provide mixed results.
Tracking results isn’t complicated or time-consuming, but there is a difference between tracking lots of data and collecting good information. Frequently, coupons are tracked based on the number sent out compared to the number returned. This does not provide enough information to determine whether a promotion was effective or not.
The critical information is based on revenues and costs. What was the cost of the promotion? Compare that figure to the revenues received from the promotion—sales, after the discount provided. Did revenues exceed costs? If so, it was probably a worthwhile promotion.4. Getting Lost Customers Back. This is difficult to measure, since it is based on your definition of “lost.” As this changes, so will the rate of success or failure. For instance, if you say that all customers who haven’t visited in a month are lost and send them a reminder, many will return. However, some customers only come in once a month and would have returned anyway.
It is critical, therefore, to develop a definition of “lost” based on individual customers’ visitation schedules. The customer who comes in every week for three months and suddenly skips two weeks is either “lost” or on vacation. Using a good POS system is the only way to create an effective definition. Once the definition is created, campaigns can be measured.
If defining, tracking, measuring and analyzing marketing campaigns seems like a lot of work, it is. It takes time and sometimes, money. But if you spend $1,000 to $5,000 or more on a particular campaign, and you spend $200 to $1,000 (or about 20% of the cost of the campaign) to measure its results, you may discover a great deal about its effectiveness and return. It will be money well spent.
 

About the author

Deborah Rechnitz, CMA, CMC

Methods for Management Inc.

Former Managing Director

Deborah Rechnitz, CMA, CMC, is the former managing director of Methods for Management (MFM) Inc., a consultancy specializing in drycleaning businesses.

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