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The Surefire Way to Tell if Your Marketing is Working

Posted by John West on Aug 15, 2018

It should be easy to determine if your marketing is effective...right?  If you run a new radio campaign and sales lift, then it worked, didn't it? If you hosted an in-store party and your traffic was through the roof, it was worth it, yes?

Not so fast team. If your goal is brand awareness, then sure—we'll give you that! But if you're looking for measurable profitability, then sales and number of transactions are not going to tell you the whole story. To calculate a single marketing campaign's effectiveness and quantify the return on investment, you must also consider not only your foot traffic, but how those foot traffic metrics compare historically, and the rate and which those customers converted. 

Blog_measure retail marketing roi

Let's talk through some real-life examples.

Your brand is running a new web and email campaign that advertises free gifts with purchase this weekend.  Sales were slightly up, but not the boom you were expecting. Transactions were up only 6%, and sales saw a lift of just 5% to last year. Did the product not deliver? Was the campaign faulty? Or was your staff just not prepared? Feels like a guessing game, but access to foot traffic and conversion data can actually help you paint a much clearer picture. 

If traffic was down, flat, or only slightly above average, you can assume the campaign didn't resonate, or wasn't motivating enough to drive in more of your target customer. If traffic was up, but wasn’t reflected in sales, then you have more questions to answer.  How were you staffed during the highest traffic times? Enthusiastic customers may have hurried in to secure their free gift, but were met with a crowded store, unable to catch the attention of a busy sales associate. Perhaps you had enough team members on the floor, but not your strongest sellers; some seasonal staff was new to the brand and not equipped with the product knowledge or confidence to navigate a high-traffic morning with many first-time customers. 

So, you lived and you learned with that one. But here's the good news: the more data you collect, the easier and clearer that learn part is to absorb. In this case specifically, if your store is using a customer traffic counter that integrates with your POS, you'll have easy access to historical foot traffic data, so you can staff strategically for your next weekend gift-with-purchase promotion. And when planning future promotions, your reports will give you a quick snapshot of which marketing promotions drew in extra customers, versus those that failed to make a dent. 

how to use foot traffic to measure marketing roi

Now what about events? We're taught that they're a pretty failsafe way to get customers in the door and enhance the store experience. But they can come at a pretty penny, and if you're hosting multiple events without accurately tracking your ROI, you could be pouring dollars down the drain.

At the most basic level, you should be tracking your events' sales and foot traffic—ok duh, we've already established that. Are you getting people in the door, and are they buying? But successful retailers are looking at more than these two metrics; they're judging their efforts based on conversion rate. The ratio of visitors to purchases will tell you a lot more about your event's success. Your foot traffic may have TRIPLED during your last sip & shop, but your conversion rate was 15%. That's a lot of people drinking your wine, eating your cheese cubes, and browsing without buying. The libations were motivating, but the product wasn't. Chances are you didn't reach your target customer, or your current product assortment isn't thrilling them. Or, maybe your foot traffic didn't see any sort of spike, yet your conversion rate doubled. In that case, your event is resonating; you just need to up your advertising efforts to get more people there!

These are all common retail scenarios that, without traffic metrics, leave your store or brand believing the campaign or event just "didn’t work."  But with customer traffic counts and conversionshown alongside your POS data—you can start to paint a clearer picture of how effective the marketing campaign really was.

Start tracking your foot traffic today!

Topics: Our Partners, Retail Marketing

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