One of the reasons that stops businesses from measuring their marketing effectiveness is the belief that its too early in the process to start when creating or developing their new marketing channels, especially when it comes to the internet or web marketing, because the technology feels so new for many businesses.

The reality though is that you should be designing in the systems for tracking your marketing both on-line (web) or off-line (direct mail, catalogue, adverts etc.) as methods exists for both.

The internet provides a more integrated or automated approach where as off-line marketing may require some manual work to generate the numbers.

You Should Be Measuring Marketing Effectiveness Against Real Tangible Results

The real reason though that you should be marketing is to generate leads and new business, so justifying your marketing expenditure should be mostly, if not always if you’re a small business, be based on the revenue your marketing produces. In my earlier career as a sales guy I always believed that this should have been the case and now there is no escaping it, especially in tough economic climates.

When you look at it like this, it seems simple but most marketers get lost in data that does not support any profitable business generation and at the heart of every business their must be profit.

Determining absolutely what your lead generation and customer acquisition statistics are is essential to understanding whether a particular activity is profitable and therefore worthwhile doing again or not. Marketing is not an exact science and does require some testing but trends and other data will lead you to the most profitable path.

To ensure your measuring marketing effectiveness as well as you could be consider the following simple guidelines:

Audit Your Current Marketing ROI Before Measuring Your Marketing Effectiveness

First use tools to separate you marketing. For off-line you can use separate phone numbers, email addresses, voucher and offer codes or other web sites and mail order coupons as examples to distinguish where leads are coming from. For on-line you should use marketing analytic tools to understand who is visiting your site, from where they came, what activity and leads are generated and later what sales are made. You can measure SEO or natural (organic) search, pay per click (PPC), blogging, social media, email, affiliate, webinars, articles and any other paid or free sources.

Once you have handle on this you can work towards closing the loop to determine how your leads generation and sales orders are relating to one another which gives you insights into sales cycles, which events triggered a prospect to become a customer and which sources generate the most customers. With your monthly sales figures to hand you can get indications of what your visitor-to-lead and lead-to-customer conversion ratios are.

Measuring Your Marketing Effectiveness Should Be Against Lead Generation and Sales Goals

Without a goal its going to be difficult to determine where your business is going and what needs to be done to get it there.

Knowing the work involved should give you an indication of the time scales, costs and resources needed from which you can build a plan of execution and budget.

Determine What Steps You Need To Take Once Your Measuring Your Effectiveness And Have Data To Take Action

As well as tracking or analytics you will also need to do some research to determine what keywords will enable you to pull in prospects on-line or where to send your marketing off-line to generate leads.

You also need to review your marketing to see whether its following lead generation best practises and then follow a proven process to execute your plans in the correct order to generate the most effective results.

This is ultimately the whole purpose of measuring marketing effectiveness.

This link offers additional detail about measuring your marketing effectiveness on-line.

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