Promotional Effectiveness

Business needs advertising and promotion to get more customers and build branding identity. Promotional effectiveness is the measurement of how effective and cost efficient a promotion is being done. It is important to measure promotional effectiveness as the ROI of business spending on A&P could be study and improved in the future.

Promotional effectiveness can be measured when you have all the data or readings related to your promotional and sales effort. How?

Before we look at how to know the promotional effectiveness, let’s study the WHY part of it (yes, there are lot more to read about the WHY than the HOW in this site).

Why measure Promotional Effectiveness ?

Think of a business as a city who is attracting visitors from other city, say for example, Kuala Lumpur as a city promoting tourism to people in Shanghai so that Shanghai people will come and visit Kuala Lumpur.

There are many channels that the people in Shanghai can come to Kuala Lumpur.

And there are many options promotional can be done through these channels.

As image below illustrated, we can have low air travel tickets promotion, as well as trans Asia train tour as part of the promotion to attract people to come to Kuala Lumpur.

So, as money are to be spent in multiple channels to attract clients or to convert prospects/visitors to become the customers, it is important that promotional effectiveness being measured.

Promotional effectiveness result will give you a clearer picture of whether your promotional and sales effort are being run correctly, bringing in the right clients and give you a better idea for your return on investment in advertising and promotion works.

Promotional effectiveness will also provide you valuable informations for your next promotional and sales activities, so that your advertising dollars are not spent unwisely. Every dollars spent should converts as many clients as possible.

Promotional Effectiveness

There is this very simple yet powerful table for you to refer when it comes to conversion rate.

Table below will give you some ideas how you may monitor and measure your promotional effectiveness:

As you can see, an increase of 50% in each section will give a result of +500% in revenue!

If you look around, you can see many of the international franchising business such as beauty salon franchise are always trying their best to get the highest conversion rate possible to increase their sales revenue.

A little bit of prospecting ideas and prospecting methods coupled with good prospecting plan will definitely increase the number of prospects.

However, as table above illustrate at a much general level in promotional effectiveness, it is better to get a professional consultant to help you in this business matter.

As a conclusion, promotional effectiveness is not a thing should be overlooked in business.

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