Return on marketing investment (ROMI) is a business’s profit attributable to marketing, divided by the marketing investment. Yet the contribution that marketing has on a company’s revenue is often one of the least understood aspects of a business.
According to a recent study, 87% of senior marketers did not feel confident in their ability to impact the sales forecast of their programs. Sophie Jillings, Head of APAC at TruRating the world’s first mass point of payment rating system, told Kochie’s Business Builders it becomes especially challenging when choosing mass marketing channels such as print, radio or TV where the actual in-store response or sales impact is harder to track.
Speaking of the statistics Jillings said:
“This is a startlingly high proportion, considering that the entire role of marketing can be boiled down to having a positive effect on a company’s bottom-line.
“However it’s now possible to use in-store technology to help you understand whether your foot traffic is being influenced by your marketing efforts.”
Jillings says TruRating has received over 12 million customer ratings, and many retailers are capitalising on the unique opportunity to understand ROMI. She shares her insights with KBB readers.
As technology and data evolves we can start to more effectively understand communication channel preferences in the general market
Catalogues and mailers work:
An average of 35.58% of customers asked, said their visit had been prompted by the brand’s catalogue or mailer. Not only does this show that a third of customers read marketing materials, but it shows that they act upon the offers and deals mentioned in them. These customers also spent 9% more per purchase on average than those who had not been prompted by a catalogue or mailer, proving that catalogues and mailers can be a really effective channel.
Loyalty programmes pay dividends:
Whilst catalogues and mailers work wonders on your broader database of customers, offering a specific loyalty program is another way of upping their average transaction spend. An average of 32.23% of customers said they had been asked to join or had redeemed their loyalty card/membership, and these customers spent on average 14% more than customers who replied “no”, proving that loyalty programs, although can be hard work to set up and maintain, are a great return for both businesses and customers.
Social channels are crucial:
Having an online presence, not only in the form of an online store, but via social media channels is crucial for driving customers in-store. An average of 13.30% of in-store customers asked said they had seen the retailer’s Facebook page or that their visit had been prompted by the Facebook page. Those customers who were aware of a retailer’s social media channels spent on average 5% more per purchase than those who said they had not seen the Facebook page. Although many retailers already have a dedicated social media channel, it’s worth considering running multiple channels (Instagram, Twitter, Pinterest etc), and have a content plan in place to give you the maximum exposure possible.
Click & Collect increases spend:
Customers who indicated that they had researched products on a retailer’s website, or researched via Google first, spent a staggering 38% more in-store than those who said they had not researched online. Consider Click and Collect functionality, that allows customers to order and pay ahead to then collect in-store.
“Tracking ROMI has always been a challenge for marketers, and it is so important especially with the high cost and effort of creating and implementing advertising materials. As technology and data evolve we can start to more effectively understand communication channel preferences in the general market, as well as within our own organisation’s customer base,” Jillings concludes.