Quantifying the success of your marketing campaign is an important part of making sure you efficiently use your marketing budget. This is true even with mediums such as radio advertising.
However, measuring ROI does not just factor in the immediate sales increase. You also need to take into account how brand awareness increases brand recall. While driving actual sales is critical, you also want to keep your brand at the forefront of the minds of those who might be buying in the future.
This means that, in order to accurately measure your radio advertising ROI, more complex metrics than just “gross sales” are needed.
Choose the right key performance indicators
Each campaign you run should begin with a concrete plan. This plan includes identifying your target audience and how you plan on engaging them. You want to consider where they are in their buyer’s journey and what the best channels to reach them are.
To understand the success of your marketing campaigns, you need to identify your key performance indicators (KPIs). These metrics will help you analyze and understand if your campaign successfully met your goals or whether something needs to be altered in your strategy. This helps you get the most growth possible from your efforts.
When selecting your KPIs, you want to set SMART goals. By SMART goals, we mean those that are:
This strategy for setting goals will help you keep your objectives reasonable and achievable, while also giving you concrete KPIs that will let you understand your success rate. You can then determine the best direction for your future campaigns.
Potential KPIs might include your gross sales, new customers, service goals, return on ad spend, percentage of increased sales year-over-year, website traffic, and month-over-month traffic or sales.
Find a proxy measurement
In radio advertising, it isn’t always easy to find a KPI that measures precisely what you want.
To help you gain a better understanding of the success of your radio marketing campaigns, use a particular action, event, or signal that occurs when people hear the radio ad. This can help you gain a better understanding of your radio advertising ROI.
For example, you can monitor your website analytics for a landing page that relates to your ad’s call to action (CTA). The increase in activity following a radio advertisement acts as a proxy measurement for the increase in awareness following the ad.
Deciphering the Effects of Brand Recall
Brand recall, or unaided brand awareness, is notoriously hard to measure, but its dramatic effect on purchase intent makes it an important metric to determine. In fact, in some industries, like car-buying, top-of-mind awareness drives 90 percent of purchase intent according to a Nielsen study.
You can use a variety of strategies to start gaining a better idea of your radio advertising metrics as they relate to brand recall. You can also use surveys to see if customers have heard of your ad and brand. However, if you remind people of the brand, you can only measure aided awareness.
Radio advertisements can help you build unaided awareness, even if customers cannot remember a specific ad. Your goal is to get them to remember your brand without help.
When you set out to create a marketing campaign, your company has objectives they want to accomplish. You do not want to waste time taking measurements for their own sake. Instead, you want to evaluate KPIs based on the SMART goals you have for your campaign. This will help you continue to adjust your campaigns and build unaided brand recall. When these factors are all taken together, it becomes possible to measure the total ROI from radio advertising, no matter how subtle the effects are.