Stock performance calculator and 5 reasons why things go wrong
Stocks and special offers are designed to stimulate demand, but the result does not always live up to expectations. In my review, I will share seven years of experience in the service of automated management of online advertising, I will tell you how to conduct promotions, I will show you examples of how not to do it, and I will give a ready-made formula for calculating the effectiveness of discounts and special offers.
To begin with, we will analyze the reasons why stocks, in principle, may not work from the word “completely”.
The success of the action is determined by a clear understanding of what the target audience (CA) needs. Identifying yourself with her is a common mistake. It’s not always what you consider to be a cool and pleasant bonus to buy, it turns out to be in demand among the audience. Start by analyzing Google Analytics data, a CRM system and (attention!) Social networks - create a portrait of your client, determine his needs, interests and preferences.
Conduct a survey on the website or in social networks and find out what your client wants. The main thing is to pick up short and catchy questions, so there are more chances that people will answer.
Chatting and online webinars help to get in touch with your audience, especially if the latter are really useful, there is an interesting speaker or invited expert.
Example:
We launched an action for users of our service, where the main prize was tickets to Formula 1 in Sochi with the included transfer and hotel accommodation. But the “wow” did not happen. The fact that the ideologists of the action seemed cool and attractive, unfortunately, did not interest customers. The result is a record low number of applications and registrations.
At the same time, a similar campaign in our other service, which is engaged in the automation of advertising on social networks, showed excellent results.
It took us a while to understand our audience. We found that she reacts much more actively to promotions with the offer of a month of free services, optimization of commercial factors as a gift - everything that is directly related to the services of the service. Clients come to us for the result of website promotion, and above all, additional tools and new opportunities to find a client are important to them.
For example, you expect that the action will attract new customers. At the same time, its message is very narrow and understandable only to those who are already aware of your products and services. But since you were preparing an offer for beginners, it is not interesting to current customers in principle. It turns out that the action does not fall into any audience at all.
Do not shoot sparrows from the cannon, immediately determine which segment of your audience you are targeting. To do this, deal with the goals: increase the average check (current customers), increase sales (select a segment with specific needs, behavior, etc.), get 500 registrations (new database). Most likely, it will not work out to do everything at once, while it is also possible to cause a negative in certain categories of CA.
Example:
One of our regular customers launched a campaign - reduced the price of movers services to 600 rubles / hour. As a result, the company recorded the lowest sales growth in history.
It turned out that the advertisement was launched absolutely for everyone who is looking for the services of a loader or transportation of things. Interested users went to the site and, only placing an order, found out that the action is valid only for services with five movers. That is, it is not available to customers of small transfers, which accounted for the bulk of orders.
Yes, the company received a good influx of new calls, but at the same time faced with a critically low conversion to purchases and a lot of negative reviews due to unjustified expectations and a sense of deception. And now it's time to connect reputation management on the network.
This could simply have been avoided. It’s easy to add an explanation of the terms of the promotion to the advertisement. Or target ads more selectively, for office removals, for example.
I recommend doing stocks on a regular basis, including them in the overall marketing strategy, and carefully ensure that offers are not unprofitable. An indicator of the quality of the action is a steady increase in new customers, building trust with old ones, and stimulating repeat sales. Vary the audience, the possible benefits relevant to the different categories of the proposal.
Example:
Another of our SEO clients launched a promotion - every Wednesday a 20% discount on cat food. As a result, the average check became lower: customers simply wanted to buy cheaper and placed orders on Wednesdays.
We advised that such a discount be made a) for those who abandoned the basket and did not finish the purchase, and b) for new customers during the second order.
This allowed the owner of a small pet store not only to exclude financial losses, but also to increase the average check, return buyers, turning them into regular customers.
All comes with experience. I recommend consistently testing various scenarios of attracting customers with mandatory measurements of the effectiveness of each of them. And only after receiving the results of how much a particular option gave customers and purchases, make a decision - include it in the number of effective solutions or start testing the following.
And do not forget that the behavior of the audience may vary depending on the season and other external factors. Save all test results and use as a base of ideas to periodically return to their analysis and rethinking.
Example:
We tested different types of stocks in our service - a free month of context automation, a bonus for replenishment, discounts on SEO, a free site audit. I wanted to motivate the client for a trial period, so that he was convinced of the effectiveness of the service, after which they would live with us for a long time and for love :) But when we analyzed the behavior of the customers attracted in this way, it turned out that there were a lot of freebie lovers among them. Such users left the service immediately after the grace period.
Then we declined offers of anything free without user response. Reciprocity is above all :) Rookee service continues to pamper its customers with bonuses and buns, but only after replenishing the balance or working with us for a certain time. Thus, we excluded freebie lovers and steadily attract new customers through promotions.
Any stock should be profitable in terms of profit. To calculate the effectiveness of the campaign, it is important to make a forecast - the approximate results you want to get. Be sure to take measurements before, during and after the promotion. And then analyze all this using the formulas that I put together for you in a convenient calculator at the end of the article.
I would like to immediately make a reservation that the effectiveness of advertising is determined not only by the economic result, but also by the psychological impact - no one has canceled loyalty and recognition. This effect can be assessed using surveys, tests, and monitoring customer behavior.
Among other things, do not forget about deferred sales, when the customer does not make purchases during the promotion period, but remembers the brand and returns later. Not everything can be calculated right away, but a rough estimate also justifies itself and allows you to compare different promotions and special offers.
The financial profitability of advertising is estimated by several methods.
The easiest and most convenient, in my opinion:
P = (Ad Profit / Ad Cost) × 100%
The rest of the calculation mechanics are much more complicated, and in order to simplify my life, I asked the financiers to create an automated template for calculating the profitability of shares, it is more tailored for saas, but it can easily be transformed to other types of business. You can insert your original data into the cells highlighted in blue, everything else is recalculated automatically. The file itself can be downloaded from the link . Good luck
If you have any working action mechanics (especially saas) or fails that you can talk about, please share in the comments or in PM, I will be extremely grateful :)
To begin with, we will analyze the reasons why stocks, in principle, may not work from the word “completely”.
1. You do not know what your audience wants
The success of the action is determined by a clear understanding of what the target audience (CA) needs. Identifying yourself with her is a common mistake. It’s not always what you consider to be a cool and pleasant bonus to buy, it turns out to be in demand among the audience. Start by analyzing Google Analytics data, a CRM system and (attention!) Social networks - create a portrait of your client, determine his needs, interests and preferences.
Conduct a survey on the website or in social networks and find out what your client wants. The main thing is to pick up short and catchy questions, so there are more chances that people will answer.
Chatting and online webinars help to get in touch with your audience, especially if the latter are really useful, there is an interesting speaker or invited expert.
Example:
We launched an action for users of our service, where the main prize was tickets to Formula 1 in Sochi with the included transfer and hotel accommodation. But the “wow” did not happen. The fact that the ideologists of the action seemed cool and attractive, unfortunately, did not interest customers. The result is a record low number of applications and registrations.
At the same time, a similar campaign in our other service, which is engaged in the automation of advertising on social networks, showed excellent results.
It took us a while to understand our audience. We found that she reacts much more actively to promotions with the offer of a month of free services, optimization of commercial factors as a gift - everything that is directly related to the services of the service. Clients come to us for the result of website promotion, and above all, additional tools and new opportunities to find a client are important to them.
2. You do not understand to whom the action is specifically addressed
For example, you expect that the action will attract new customers. At the same time, its message is very narrow and understandable only to those who are already aware of your products and services. But since you were preparing an offer for beginners, it is not interesting to current customers in principle. It turns out that the action does not fall into any audience at all.
Do not shoot sparrows from the cannon, immediately determine which segment of your audience you are targeting. To do this, deal with the goals: increase the average check (current customers), increase sales (select a segment with specific needs, behavior, etc.), get 500 registrations (new database). Most likely, it will not work out to do everything at once, while it is also possible to cause a negative in certain categories of CA.
Example:
One of our regular customers launched a campaign - reduced the price of movers services to 600 rubles / hour. As a result, the company recorded the lowest sales growth in history.
It turned out that the advertisement was launched absolutely for everyone who is looking for the services of a loader or transportation of things. Interested users went to the site and, only placing an order, found out that the action is valid only for services with five movers. That is, it is not available to customers of small transfers, which accounted for the bulk of orders.
Yes, the company received a good influx of new calls, but at the same time faced with a critically low conversion to purchases and a lot of negative reviews due to unjustified expectations and a sense of deception. And now it's time to connect reputation management on the network.
This could simply have been avoided. It’s easy to add an explanation of the terms of the promotion to the advertisement. Or target ads more selectively, for office removals, for example.
3. You do not have a strategy and the action simply reduces income
I recommend doing stocks on a regular basis, including them in the overall marketing strategy, and carefully ensure that offers are not unprofitable. An indicator of the quality of the action is a steady increase in new customers, building trust with old ones, and stimulating repeat sales. Vary the audience, the possible benefits relevant to the different categories of the proposal.
Example:
Another of our SEO clients launched a promotion - every Wednesday a 20% discount on cat food. As a result, the average check became lower: customers simply wanted to buy cheaper and placed orders on Wednesdays.
We advised that such a discount be made a) for those who abandoned the basket and did not finish the purchase, and b) for new customers during the second order.
This allowed the owner of a small pet store not only to exclude financial losses, but also to increase the average check, return buyers, turning them into regular customers.
4. You do not test new stocks and do not analyze errors
All comes with experience. I recommend consistently testing various scenarios of attracting customers with mandatory measurements of the effectiveness of each of them. And only after receiving the results of how much a particular option gave customers and purchases, make a decision - include it in the number of effective solutions or start testing the following.
And do not forget that the behavior of the audience may vary depending on the season and other external factors. Save all test results and use as a base of ideas to periodically return to their analysis and rethinking.
Example:
We tested different types of stocks in our service - a free month of context automation, a bonus for replenishment, discounts on SEO, a free site audit. I wanted to motivate the client for a trial period, so that he was convinced of the effectiveness of the service, after which they would live with us for a long time and for love :) But when we analyzed the behavior of the customers attracted in this way, it turned out that there were a lot of freebie lovers among them. Such users left the service immediately after the grace period.
Then we declined offers of anything free without user response. Reciprocity is above all :) Rookee service continues to pamper its customers with bonuses and buns, but only after replenishing the balance or working with us for a certain time. Thus, we excluded freebie lovers and steadily attract new customers through promotions.
5. You do not analyze the effectiveness
Any stock should be profitable in terms of profit. To calculate the effectiveness of the campaign, it is important to make a forecast - the approximate results you want to get. Be sure to take measurements before, during and after the promotion. And then analyze all this using the formulas that I put together for you in a convenient calculator at the end of the article.
I would like to immediately make a reservation that the effectiveness of advertising is determined not only by the economic result, but also by the psychological impact - no one has canceled loyalty and recognition. This effect can be assessed using surveys, tests, and monitoring customer behavior.
Among other things, do not forget about deferred sales, when the customer does not make purchases during the promotion period, but remembers the brand and returns later. Not everything can be calculated right away, but a rough estimate also justifies itself and allows you to compare different promotions and special offers.
Calculator: how to calculate the effectiveness of stocks and special offers
The financial profitability of advertising is estimated by several methods.
The easiest and most convenient, in my opinion:
P = (Ad Profit / Ad Cost) × 100%
The rest of the calculation mechanics are much more complicated, and in order to simplify my life, I asked the financiers to create an automated template for calculating the profitability of shares, it is more tailored for saas, but it can easily be transformed to other types of business. You can insert your original data into the cells highlighted in blue, everything else is recalculated automatically. The file itself can be downloaded from the link . Good luck
If you have any working action mechanics (especially saas) or fails that you can talk about, please share in the comments or in PM, I will be extremely grateful :)
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