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View Full Version : Marketing ROI on mailers, fliers, doorhangers


jmkreisle
12-13-2008, 09:54 AM
I have ROI Calculator on one of my sites... Everyone welcome to use it. I t is very useful for learning about your actual results and also forcasting by adjusting factors such as your pricing or cost of delivery.

Here it is..... http://www.pressurewashchat.com/direct_mail_roi.html


Steve, feel free to put this calculator in a post as I an not sure how to do it.

Steve
12-13-2008, 07:51 PM
Oh Mike, that is fantastic!

I just made a screen cap of a calculation I did. Could you walk us through what some average figures we should be shooting for?

What should a lawn care business owner be shooting for with the following?

Number of pieces you are mailing or e-mailing:
Total program costs:
Response Rate: % of responses expected:
Conversion Rate: % of responders expected to make purchases:
Average profit per sale:

Also is the "Conversion Rate: % of responders expected to make purchases"
the % of the responders who made a purchase or is it a % of all the mailers you sent out?

Is the "Average profit per sale:" the average you are selling each customer total over time, so if they are a customer for 4 years, on average they spend $3,000. Or is it the average price per each sale, say for instance a mowing?

Great job on this!

Steve
12-13-2008, 07:53 PM
Oh and here is my screen cap.

jmkreisle
12-14-2008, 09:26 AM
I suppose you guys could figure in the value of the CONTRACT. Only count money that is contracted. Next year is not a given. See, I sell House washes or roof cleans at $400+/each, so I use my profit number for those.

I try to shoot for 1000% ROI. Which keeps my marketing $$ to 10% of Gross revenue.

So a Postcard campaign of 1000 cards costs me $280... 1% call me and I close 80% with average profit of $375 gives me a ROI of 971%

You can play with the different variables to see how raising your price would do. Or if you could close more sales. Mostly it is for identifying which Marketing efforts are performing better.

Steve
12-14-2008, 10:59 AM
I try to shoot for 1000% ROI. Which keeps my marketing $$ to 10% of Gross revenue.

So a Postcard campaign of 1000 cards costs me $280... 1% call me and I close 80% with average profit of $375 gives me a ROI of 971%

Ok so a ROI (Return On Investment) of 1000% would mean for every dollar you spend on advertising, you are getting a return of $10?

Do you have any advice as to why 1000% ROI is a good thing to shoot for? Do you think this is a standard for this industry or any?

jmkreisle
12-15-2008, 10:36 AM
Ok so a ROI (Return On Investment) of 1000% would mean for every dollar you spend on advertising, you are getting a return of $10?

Do you have any advice as to why 1000% ROI is a good thing to shoot for? Do you think this is a standard for this industry or any?

1000% is good if you are trying to keep your marketing expense to only 10% of Rvenue. Your other sosts are there too. Obviously, you want to keep ALL costs low in order to turn good profit. If you are spending more than 10% on marketing, then you are leaving $$ on table as far as profit margins.

Pretty standard for ANY industry to limit thier marketing budget to 10% or less. In the beginning a company might be spending 25% on marketing, but as word travels and repaets and refeerals start coming in, the marketing budget goes down or produces better. Either way lowering the expense %.

It needs to be analyzed contantly to determine if things are working and where improvements should be made.

Steve
12-15-2008, 09:48 PM
If you are spending more than 10% on marketing, then you are leaving $$ on table as far as profit margins.

So you mean if you are spending more than 10% on marketing, you are spending your profit and you shouldn't be doing that?


but as word travels and repaets and refeerals start coming in, the marketing budget goes down or produces better.

Do you have any advice on the best way to bring in referrals? Should a business owner give our maybe business cards that say "this card good for one sidewalk powerwashing." Or something like that and then when you are there, you can try to upsell them on some other larger service? Possibly at a discount?

Or maybe a coupon to get half your sidewalk, driveway or house powerwashed for free to see the difference. Or maybe a driveway or something like that.

Do you keep your eye out for other powerwashing service referral marketing? And have you ever seen anything that just blew you away?

jmkreisle
12-16-2008, 06:43 AM
So you mean if you are spending more than 10% on marketing, you are spending your profit and you shouldn't be doing that?




Do you have any advice on the best way to bring in referrals? Should a business owner give our maybe business cards that say "this card good for one sidewalk powerwashing." Or something like that and then when you are there, you can try to upsell them on some other larger service? Possibly at a discount?

Or maybe a coupon to get half your sidewalk, driveway or house powerwashed for free to see the difference. Or maybe a driveway or something like that.

Do you keep your eye out for other powerwashing service referral marketing? And have you ever seen anything that just blew you away?

Referrals? Well, obviously doing a good job is key, but more importantly... Staying in touch with previous customers is very important. This is why I said marketing $$ go down. It is cheaper to KEEP a customer than it is to gain a new one. Newsletters through email and Birthday/Christmas Cards etc. I try to get every customers email so that I can send then updates about our services and special offers. It's easy for a customer to refer you to a friend or neighbor when you are in thier face and on thier mind so often. When they are asked, they remember you. Also good for repeat. You might send a newsletter announcing that you now spray for weeds and they've been unhappy with current provider. Had you not stayed in touch, they wouldn't even know you did this.

Steve
12-16-2008, 10:50 AM
Can a company that focuses on pressure washing offer annual contracts? Can you offer reoccurring services to commercial and residential clients? Is there any standard to this?