If you work in marketing, it’s pretty unlikely that you haven’t come across the acronym ROI before. But do you really understand what it means for your small business marketing efforts? And then there’s the question of Christmas marketing. Not so much a question but an imperative, as ROI and your festive campaigns go hand in hand. Read on for a run down about ROI and how it can be your little helper for your small business marketing during the busiest time of year.
ROI is determined by how much your sales grow relative to how much you’ve spent on marketing
Firstly, why do you need ROI (return on investment) and how do you calculate it? It goes without saying that your budget is the oil that makes the wheels of your small business marketing turn. But there’s no point adding oil to wheels that don’t turn – just like you shouldn’t pump money into marketing strategies that don’t increase sales in the long term. The only way to determine whether your marketing efforts are creating more sales is with this calculation:
(sales growth - marketing cost) / (marketing cost - average organic sales growth)
For a more detailed explanation, head to Investopedia.
Your ROI will tell you whether the money you’re spending on your small business marketing is paying dividends. It’ll also show you whether your marketing tactics are effective. Remember that it’s better to look at ROI over a decent amount of time (six months to one year +), as monthly fluctuations in sales spikes can be misleading.
Your ROI needs to be maintained even if you up your marketing budget during Christmas
So where does the festive season come into all of this? Well, the months of December and January require their own tailor-made marketing strategy to take Christmas and New Year into account. People’s spending habits and retail expectations change during this time. With the flurry of marketing messages coming at them from every angle, you need to find novel ways to attract and retain their attention and make sure your ROI keeps up. There’s no use blowing your budget on a big shot TV ad if it makes no impact on sales.
TV ads aside, how can a small business adapt their marketing strategy to the yuletide happenings and bump up their ROI? Feel free to get as into the Christmas spirit as you like, just don’t fall into the familiar trap of Father Christmas hats, tinsel and overplayed Christmas carols. Do something that sets yourself apart from the rest and look at the festive ecommerce trends, as we emphasised in our previous blog How to get your marketing strategy ready for the festive season.
Whatever you do as part of your yuletide marketing campaign, make it original
There are plenty of things you can do that’ll increase sales and require minimal spending, like customising your website, online store and social media profiles to make them look merry. You can also jazz up your email signature, as well as any flyers or newsletters you’ll be sending out during the festive months. If you have a brick and mortar store, decorate it with things inspired by the industry you work in. Run a wine shop? What about making Christmas decorations out of wine corks?
The festive period is also the ideal time for promotions and discounts. You could kill two birds with one stone and use Christmas as a chance to gather some valuable information about your customers in the form of a survey, enticing them with a festive giveaway. It’s also vital to ensure your customer service team is on top form during this time - don’t let the Christmas rush be an excuse for sloppy service.
Having an online presence makes keeping track of ROI a breeze
Having an online presence is non-negotiable in the digital age. Not only can you reach, engage and interact with more customers, your online activity is measurable. It gives you the cold, hard data you need to calculate ROI, it’s a lot more affordable than that glossy magazine ad and if your small business marketing efforts aren’t achieving their goals, a website or online store are easy to tweak to take the latest ecommerce trends into account, for example.
Still stuck for some marketing ideas you can adapt to the festive season? Check out our marketing guide for some inspiration.