Having a data driven approach and measuring your results will show you what your invested funds have achieved, and prove whether your field efforts are actually improving your sales. At the end of the day, data is your biggest ally, as it will tell you where you’ve been, where you’re heading, and where you want to be. Here are the four main metrics you should use to collect data on the success of your promotion, as well as some suggestions on how to leverage this data:
Promotions, like other investments, fundamentally work by earning revenue in exchange for a smaller investment. It is important to evaluate the impact of sales promotions on profit because it is possible for promotions to lead to higher sales but lower profits. In order for a promotion to be profitable, incremental customer sales must increase and the cost of obtaining one dollar in increased sales must not exceed a dollar.
In order to accurately measure the increase in sales volume, you need to know your baseline (what sales were prior to the promotion). Using both the data you already collected and data you collect throughout the duration of the promotion, make a comparison. This equation can be used to find your overall increase in sales:
Overall Sales Lift = Lift in Promoted Item Sales (the difference between the sales baseline and the new sales volume).
Customer satisfaction is a key facet to customer loyalty and long-term brand switching, so it important that you measure it by collecting data to measure exactly how satisfied customers were with your promotion and with your overall product. Some things to look at: What are people saying about your brand or product online? If you are interested in gaining deeper insight, try inviting your customers to fill out a quick survey or use a hashtag with the promo to tell what they think of your brand. Using the information you gather, you’ll be able to hear truth of what customers thought of your promotion.
Take another look at goals you set for the promotion. Does your data show that you have achieved them? While the principal, overarching goal of your promotion should have been to boost sales and increase brand recognition, another main goal of your promotion should be to record and analyze the results for future use. Even if your promotion was not “successful” in the way you planned, having accurate measurements of all of the factors at hand will allow you and your team to identify areas for improvement. As we mentioned earlier, sometimes a promotion can seem successful on the surface, but can actually not produce the intended results. Make sure you are setting multiple goals ahead of your promotion so you are able to track metrics for all of them and determine the true effectiveness of your efforts.
“Life begins at the end of your comfort zone.”
~ Neale Donald Walsch
