Return Rate

[SolidShellSecur]

When buying advertisement what do you consider or try and achieve as your return rate.

Example:
Say you pay $50/mo on a hosting ad. Do you expect to recover that after 3 months from the clients gained that month.

 

[7Host]

Sure I expect to get more money than I invested in promo

 

[bermuda]

There are actually no fixed formulas to come up with in such cases because nobody is actually certain about the outcomes that are to be achieved upon using paid advertising programs. Sometimes purchasing a very affordable advertising spot on a blog for instance might help secure dozens of sales within a week while at other times even hundreds of dollars spent on advertisements may not be that useful.

There is one more extremely essential matter to note and that is how your website looks to the potential customers. You see, many times the ads placed throughout the net are indeed pretty useful, sending tens of people to your website but they may not actually proceed with the checkout process, simply staying on your site for some seconds or minutes and then leaving.

 

[paullopez]

The most crucial part of any business is ROI, without a proper ROI analysis it is pointless to plan any future investment in business.

 

[valuehostus]

ROI is important. But to forecast ROI from ads is complicated. When company is in the start up, advertisement may only increase the awareness but few gains can be generated in the initial stage, so we can not expect an exact % from the advertisement, in my opinion.

 

[nexxterra]

There are a few outcomes from advertising, Name recognition for one will not really work out from a ROI point, too hard to measure.
Sales, visits, sign ups however you can track.
You may have a sign on your car that cost you $50 to have made, someone stops you in the parking lot and asks about your service, measurable, but rarely happens. What usually happens is they see your sign, weeks later when looking for service they come across your ad and MANY others, they chose yours, they chose it because they had heard of you before, they may not remember where but they saw your name...
The big problem is if you do not have a big budget, you need to ensure your ROI is at least what you spend so you can repeat... your customers will stay giving you a net profit down the road.

 

[romes]

When I advertise I try to do two things.

The first thing is I try and find places to advertise that reflect my business. I may go through a handful of sites without gaining sales but that is how I go about trying to find a good advertising spot. Also, you need to figure out a goal for that ad. Are you trying to raise awareness where sales are not necessarily needed but appreciated or are you going for sales only. You wanna find a site that can give you not only give you good impressions but decent click ratio. (Click Ratio Definition)

Secondly, I want to find a site that gives me decent sales. I want to find a site where I make my initial investment back and produce at least 2-5 more sales. This may seem like a low amount, but if I advertise every month on this particular site and I make back what I spent, plus additional sales then it is a spot worth keeping.

Advertising will take time to perfect. You need to be willing to spend money to make money. Spending $50 on advertising and making $0 and then saying to yourself "I can't afford to advertise anymore if I keep getting $0 back" will only hurt you. You need to find the right sites that will work for you. Also, focus on what you want...Brand awareness or sales? I try to do a combo of both. People will most likely remember your name so when the need arises it will be fresh in their mind and will most likely throw it out there in conversation.

Always research before advertising. You will waste money from time to time but if you do your homework you should make at least 1-2 sales that will hopefully return your investment on a particular site.

 

[WebNet Host]

The whole point of advertising is to gain more than what you have invested. A good research will give you more chance to get a good ROI.

 

[concerto49]

I don't expect to get that rate back. Advertising is part of getting the company/brand known and out there. You can't recover these "costs".

It's part of building a reputation and user base.

 

[easyhostmedia]

You can't recover these "costs".

clever marketing etc. you could try and recoup some of these costs back, buts its not essential as it is the cost of brand awareness.

As I also sell toys at summer fairs/country shows throughout the year i usually advertise in the fair programmes which cost anywhere from £20 to £100 depending on the fair and offer a discount to anyone that signs up within 7 days of the programme. I may get a few enquiries that lead to new clients. I recently has a new client sign up who saw an ad in a 2009 programme. I also sponsor a childrens photo comp at 1 fair and have even sponsored a whole fair in the past, these costs will never be recouped, but its all about brand awareness and getting your name out their.

 

[Jon N]

I would expect to get somewhere near what I invested for the advertisement. If not, at least I got my company name out there, which is one of the reasons why I would consider buying an advertisement.

 

[easyhostmedia]

I would expect to get somewhere near what I invested for the advertisement. If not, at least I got my company name out there, which is one of the reasons why I would consider buying an advertisement.

so when a company like mcdonalds spend 5 Million + on an ad campaign do you think they get all that back on that 1 ad campaign? I think i read somewhere that large companies work on getting 20 to 30% recouped back on an ad campaign with their day to day sales covering the rest.