Is My Advertising Working?

[insomniac]

Was wondering if anyone tracks how much it cost per lead. I started to track this myself and I have found over the last 8 weeks I have had exactly 200 leads and have spent $6480 to acquire those leads thus costing me $32.40 per lead. I was wondering if anyone else has tracked there cost per lead and see how it stacks up to my $32.40. I question whether my advertising is effective based on my numbers.

 

Thanks

[jrendem]

How many of those leads turn into customers for you?

 

Sorry, I really don't have an answer here but I have been researching lead generation for shop owners and discussing in the the thread next to this one.

[PeterDrunski]

I know that Google Adwords charges about $7-10 per click if you run an add with them.

[johndebusk]

I'm a field rep for Mitchell 1 but before I came here I sold internet marketing and I'm Google Ad Words certified. You did not mention how you are acquiring your leads: Google AdWords, Mitchell 1, DemandForce, US Mail, etc. However, that really does not matter. The goal of any marketing program is not to generate leads but to generate conversions: defined as either someone that emails you or picks up the phone and calls your shop. That's where your marketing program ends and your work begins. Your job is to turn that conversion into a sale. The key is tracking those leads. If your lead generates a $100 profit and you paid $32.70, you made a $67 profit on that lead. If you make a $25 profit, you lost $8. Remember thought that a lead is not a one-time shot, You may lose money on that first customer visit (like they get just an oil change) but you may end up having a repeat customer for years to come. If you are running a Google AdWords campaign, work with a company that has a track record. It can be a real money pit if you manage your own campaign. Keywords, competing ads, and time of day all play into the price per click you pay.Hope this helps you.

Edited October 11, 2015 by johndebusk

[ScottSpec]

I can't answer your question specifically, but we have recently begun several marketing programs. I looking at advertising as an investment. While impressions, leads, clicks, calls, conversions, etc. are nice metrics to talk about, the real measure is ROI like the above posts states. How much am I making from my investment in advertising is the question to ask. This however can be very difficult to calculate. Do you look at the short or long term value of the customer? What about customers referred by them? Right now I am looking at what that customer spends over a 3 year period plus what any of their referrals spend over a 3 year period.

 

Scott

[insomniac]

I can't answer your question specifically, but we have recently begun several marketing programs. I looking at advertising as an investment. While impressions, leads, clicks, calls, conversions, etc. are nice metrics to talk about, the real measure is ROI like the above posts states. How much am I making from my investment in advertising is the question to ask. This however can be very difficult to calculate. Do you look at the short or long term value of the customer? What about customers referred by them? Right now I am looking at what that customer spends over a 3 year period plus what any of their referrals spend over a 3 year period.

 

Scott

 

 

Thats a great way to look at it but how do you track that?

[mspecperformance]

 

 

Thats a great way to look at it but how do you track that?

 

Your management software should have some way to track this. Also there will probably be some manual input when you close out a client on "who referred you". These are system that have to be in place for your service advising team so they can collect and enter this info so you can measure it.

[mspecperformance]

Another thing to remember is how can you accurately tell if you are getting quality leads? I struggled with this constantly as I can get tons of calls however my conversion rate could be low and then the blame game starts. Must be that all those people who are calling are just low quality leads right? Not necessarily.

 

What I am getting at is the other very important component is having the right staff and right systems to take advantage of those leads and convert them into appointments/customers. Before making the big investment in marketing, make sure you are investing and setting up your systems and have quality and talented people to use them. Training is big here.