How to Tell if Your Ad Campaign is Working
by Dera DeRoche-Jolet

I can’t count how many times I’ve heard, “Advertising doesn’t work.” Of course, part of the reason is that many businesses that advertise run only one ad and then just sit back and wait for the phone to ring. We know that’s not going to succeed.

Another reason is that advertising is not an exact science. For instance, you can't find out how many sales dollars are generated by each advertising dollar you spend. Plus, a lot of factors including time of the year and the state of the economy come into play making it pretty hard to accurately measure the success of your ads. But there are techniques you can use that will give you a rough idea of whether or not your ads are working.

To measure the effectiveness of your advertising campaign, you should monitor sales, as well as keeping track of new customers, requests for information, phone inquiries and even web-site traffic. Here are some ideas that will help you not only determine the effectiveness of your ads but will also give you some new marketing ideas.

• Compare your sales before, during and after an ad campaign. Keep in mind that advertising often has a delayed effect and can then grow steadily, so sales that result from your ads may not materialize immediately.

• In print ads, include a coupon that customers can redeem for a discount or gift with their purchase. Code the coupons so you can determine which ad or publication gives you the best results.

• Offer an incentive for customers to tell you they're responding to an ad: "Mention this ad and get a 10 percent discount off your alarm system."

• If your business is a storefront rather than an office space, track retail traffic by counting the people who enter your store. Don't forget to monitor traffic before you start the ad campaign, so you'll have a basis for comparison.

• Some publications offer response cards that let readers request information from advertisers. Keep track of which publications those leads are coming from.

• Use dedicated phone lines to track responses. For example, if you mention a toll-free number in your ad, assign different extensions to particular ads.

• Your web site should have a form that visitors can fill out to request more information. That form should also include a place that potential customers can put in where they heard of your company.

• Compare the before and after advertising traffic on your Web site. Your Web host logs the hits on your site and should be able to provide you with daily, weekly or monthly reports.

• If you advertise online, for instance on your local paper’s web site, track the clickthrough rate — the percentage of viewers who click on your ad. Most sites that sell ad space track these rates and can provide you with statistics.

• Don't overlook the basic approach: Ask all new customers how they heard about your business.

Keep in mind that you can't measure success if you don't know what you're trying to achieve. Make sure you have clear advertising goals. You might want to boost business overall, but your objective should be more specific. For instance you might want to increase sales of new products such as digital video recorders or a new service such as GPS or video. Another goal might be to build awareness of your company. At certain times of the year you might want to stimulate overall sales or expand your business in a particular market such as home integration.

By combining the way you measure your ads with your goals, you’ll know when your ad campaign is working.