Businesses large and small understand the importance of knowing whether expenditures are paying off. Sometimes, that’s easy: a new point-of-sale system has helped maximize profits and minimize inventory costs, or the purchase of the new delivery vehicle has easily compensated for the old vehicle’s repair costs and downtime. Advertising, on the other hand, can be more difficult to measure. You put out your money, but what do you get back? Understanding three key components can help you judge digital advertising effectiveness.
Marketing to Build Your Brand
On the one hand, marketing and advertising aren’t always a direct money-in/money-out equation. Getting your name in front of the public also serves to build brand recognition and reputation.
Similarly, even the most effective ad campaign can take time to build momentum. Consumers are unlikely to act on the first few views of a new ad, but repetition leads to recognition, familiarity, and an eagerness to act.
Digital Advertising Effectiveness in Maximizing Profit
But when it comes to driving business to your doorstep, some aspects of advertising are quantifiable and measurable. Digital advertising has clear advantages over traditional advertising when it comes to measuring results. Reports can often tell you exactly how many times your ad appeared, how many people clicked on it or otherwise engaged with it, opened your email, clicked on links in your email, and so on.
To measure results, you’ll need to set goals, establish a baseline, and then measure again. Your goals can include ad clicks, website visitors, phone calls, etc.
Marketing is like baking a cake. A cake can flop for a variety of reasons: old or mis-measured ingredients, oven temperature, length of baking time, altitude, weather, baking pan, and more. You never attribute the final product to one single ingredient – it’s all how they all work together.
In the same way, a business needs to examine the interaction of diverse “ingredients” to understand its key performance indicators (KPIs). Savvy leaders can take an experimental approach, tuning dials and noting results. They can look at expenditures, investments, revenues, inquiries, traffic, and many other variables, and then add layers of different ingredients to see how they affect overall business and benchmarking.
In digital marketing, if people are coming to your website but not purchasing, the problem could lie with any number of factors: your website (difficult navigation, slow to load, or unprofessional look); prices (too high for your market); products and services (not what visitors are looking for); the wrong web visitors (not your ideal customer base); customer service or visitor follow-up; external factors (like a pandemic); or any number of other causes.
Advertising, like other business metrics, can be complex and difficult to measure. By engaging with a digital agency that understands small business dynamics, you can gain a better understanding of how your marketing dollars are performing. Such an agency, like Ross Media Solutions, comes equipped with the wisdom gained over years of trying, pivoting, and evolving. An agency that relates to your struggles can help you to “bake” that cake and adjust ingredients as needed.