Measuring the results of your advertising 

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Measuring the results of your advertising can help you determine which styles, methods and media work best for your business. With solid data, you can plan how to best invest your valuable advertising dollars.

For an advertisement (ad) to be effective, it must translate into enough extra sales to generate a profit. How can you tell if a sale is the result of a specific ad?

Measuring advertising results can be more of an art than a science. The following information will help you plan and carry out your measurements, and compare them against each other.

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What results should I expect from my advertising?

Essentially, measuring results of your advertising means comparing the value of your sales with the cost of advertising. To do this, you need to start early in the process-before you even make up the advertisement. Ask yourself: "What do I want the advertising to do for my business?"

Immediate response advertising should cause the potential customer to buy a particular product from you within a short time (i.e. today, tomorrow, or next week). An example of an ad that triggers such a decision is one that promotes regular-priced items or services but which has immediate appeal. Other examples are ads with price appeal such as clearance sales, holiday sales, back to school sales.

Attitude advertising (or image-building advertising) should keep your business name and products known. With it, you remind people week after week of the products or services that you regularly offer or tell them about new or special services or policies. This kind of advertising should help you positively influence the attitude of the public toward your business and your products or services.

Attitude advertising is harder to measure than immediate-response advertising because you cannot always attribute a specific sale to it. Its sales are usually created long after the ad has appeared. However, you may notice that an ad or a series of ads that announce a particular brand start to pay off when you begin to get customers who want only that brand and ask no questions about competing brands. In short, the message lingers in the minds of those who have seen or heard the ad. Sooner or later, these people may act upon the message.

Because the effect of attitude advertising is spread out over an extended period of time, you can measure the results in a more leisurely fashion. Some attitude advertising, such as a series of ads about the brands that a store carries, can be measured one month after the ads appear, or at the end of a campaign.

What tools and techniques can measure my advertising results?

Whether you are trying to measure immediate response ads or attitude advertising, the better you plan, the more accurate your results will be. You must not only determine what you expect your advertising to do, but also find ways to determine if clients have seen or heard the ad.

Testing immediate response ads

The following devices can help you weigh the results of your immediate response advertisements:

Use coupons

Usually, redeemed coupons represent sales of the product. Ask yourself whether enough sales were made to pay for the ad. Date the coupon so you can determine the number of sales for the first, second, and third weeks that you placed the ad.

In your radio or television ads, you can have listeners create their own coupons. For example, ask them to redeem their hand-drawn coupon for a free offer sample.

Use coupons for direct mail advertising

Code the coupon in such a way that you can easily measure the response. You can even use bar codes containing detailed demographic information.

Hide offers in the ad

A hidden offer can allow you to track how many clients saw or heard the ad because they'll have to mention something in person, on the phone or in writing. For example, in the middle of an ad, include a statement that will allow the customer to receive a free sample, great discount or something similar upon request or by saying a magic word. Results should be checked over a period of one week to between six and twelve months since people may not immediately react to this type of ad.

Compare similar ads

Prepare two ads (only slightly different according to the variable you'd like to test) and run them on the same day. Identify the ads — in the message or with a coded coupon — so you can tell them apart. Ask customers to bring in the coupon or to use a special phrase. Run two broadcast ads at different times or on different stations on the same day with different discount phrases. Ask a newspaper to give you a split run — that is, to print ad A in part of its press run and ad B in the rest of the run. Count the responses to each ad to see which scenario is most effective. Comparing similar ads is also effective in other media such as on the Internet.

Promote a particular item

If the ad is about a bargain or limited-time offer, you can consider that sales for the following four weeks came from that ad. You may need to judge how many sales came not from the ad, but from in-store displays or were encouraged by your sales associates.

Check your business' traffic

An important function of advertising is to build client traffic that also results in customers buying items that are not advertised. For example, a customer who are attracted to a store by an ad for a blouse may also buy a handbag. Some may buy the bag in addition to the blouse, and other may just buy the blouse. You could hire students to interview customers as they leave the store to determine which advertised items they bought, what other items they bought and what they shopped for but did not buy. Website traffic works in a similar way.

Testing attitude (or image-building) advertising

Compare advertising and sales records

The individual ads are building blocks, so to speak, which make up your advertising over a season. The problem is trying to measure each ad and the effects of all of the ads taken together.

When advertising is spread out over seasons, to measure its effectiveness, you need to keep records. Your aim is to compare records of ads and sales for an extended time-period. Keep a record by date of all forms of advertising, record their cost, keep a copy of each ad, and break the file down into monthly, quarterly, or semi-annual blocks. By recording the sales of the advertised items on the copy of each ad or in a log, you can make comparisons.

One approach is to make weekly comparisons. For example, if you run an ad each week, compare each week's sales with sales from the previous week as well as with the sales of the same week a year ago. You will, of course, be measuring the momentum of all of your ads as well as the results of a single ad. After time, you will probably be able to estimate how much of the results are due to the individual ad and how much to the momentum of all your advertising. You may then make changes in specific details of the ad to increase response.

When comparing sales increases over another period, keep in mind that some situations may have been unusual. For example, your experience may be that rain on the day an ad appears reduces its pulling power by 50%. Similarly, advertising response will also be affected if your customers work in a factory that is out on strike.

What factors should I take into account when comparing advertising results?

Divide ads into at least two classes: high-response ads and low-response ads, then look for differences between the two classes. You should then be able to determine the combination of factors that work best for your business and products.

Timing

The time the ad was broadcast or run may be responsible for a particular response level. However, other factors may be as influential as time, though in radio, time is often crucial. On the Internet, targeting the right audience may be the most crucial factor.

The tone or look of the message

Consider the message and how well it was expressed. If you used slogans, did they help make the point? For print and Internet, consider the effects of images, type size, white space, colour, and ad location. In broadcast, consider whether or not the voice of the person doing the ad or the music used may have had an effect. Check the effect of the length of broadcast ads. Did you get the best results with 10-second, 30-second, or 60-second ads?

Media

No business should count on finding a magic formula. There is no single formula that will ensure high response ads every time. Advertising changes. Therefore, you should watch the ads of others to see what changes are occurring. These days, it is especially important to note the changes in media used. The Internet and personal electronic devices have revolutionized the way you can reach consumers and target clients. Continue to analyze your own ads, make small changes occasionally, and note any variations in response.

Feedback

Listen to what people say about your ads. In doing so, try to discover the mental framework within which any comment about your ad was made. Then try to find points that reinforce believability and a feeling that your product fulfills some customer wish or need.

However, you should not be misled by what people say. An ad can cause a great deal of comment and bring in practically no sales. An ad may be so beautiful or clever that, as far as the customer is concerned, the sales message is lost. An ad can spread like wildfire and become viral with electronic devices — it doesn't mean the ad is affecting your bottom line.

How do I measure the results of my Internet advertising?

Business websites have become an important — if not essential — tool for marketing one's goods and services. Similarly, placing ads on the Internet is becoming an increasingly effective way to promote a product or service since it targets people that are already interested in what you have to offer.

You can measure the effectiveness of your Internet advertising by counting how many people have come to your website through each ad (your ads may vary by type and size, as well as by message, image, or layout). Let's call these channels by which a customer came to your site. Name each channel in a way that you can distinguish it from another, by inserting the variable component (colour scheme, image, placement, etc.).

For more information on the uses of the Internet for business, and in particular, marketing on the internet, consult the following documents.

  • Online marketing

    Online marketing techniques like social networking, emailing and blogging are useful and involve little to no direct costs.

  • Website analytics and performance management

    Do you want to know how effective your website is? Find out how visitors reach your website, what they do there, and how often they visit.

  • Developing your website

    Learn how to create a website so you can attract more customers to your business.

Can I compare ads from different media?

When your ads appear simultaneously in different media (such as newspapers, radio, television, the Internet, direct mail or flyers), you should try to evaluate the relative effectiveness versus the cost of each. You can check one printed medium against the other by using companion ads — the same or almost identical ads.

You can make the job of analyzing and comparing results by varying your copy — the message. Your ad copy, thus, becomes the means of identifying your ad response.

You can check broadcast media-radio, television and Internet-by slanting your message. Suppose, for example, that you advertise an item at 20% off. Your ad might say something like this: "Come in and tell us you want this product at 20% off."

You can compare these responses with results from your "20% off" newspaper ad. Require the customer to bring in the newspaper ad or the coupon.

Some of the ways to vary the copy are: combining the brand name with a word or words indicating the product type; tone of voice; speed of delivery; variations of picture, size and colour. Check your printed ads against each other as well as against your broadcast ads.

Be careful that the copy variation is not so great that a different impression is received from each medium. Here you would, in effect, have two different ads.

Are there short-term and long-term effects of advertising?

Even one ad, commercial or highway poster can result in sales for one product and attention for your business. You should remember, however, that a series of related ads leads to sales over a longer period of time than the campaign lasts. Your business name will become much better known. Your spending on advertising therefore, should be scheduled over a period of three, six and 12 months.

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