ROI Comparison

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Compare ROI and specific features of Social Media, Direct Mail and Email marketing.

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ROI Comparison

  1. 1. ROI Comparison:Social Media v. Direct Mail v. Email<br />Follow the $$...........but look behind the curtain!<br />
  2. 2. Relevant and Interesting Stats<br /><ul><li> More than half of online tweens and teens, and 42% of online adults want to see a social application from their favorite brands. For example, one in four US online adults want to see discussion forums from brands they like, while more than one-third of teens want profiles on social networks. See the Forrester Research April 16, 2009, “The Social Tools Consumers Want From Their Favorite Brands” report.
  3. 3. Most data suggests that the response rates for “opt-in” campaigns range between 5% and 15%. Conversely, “unsolicited” or “opt-out” marketing typically has a response of <1%...........Sources: Marketing Scoop, eMarketer
  4. 4. Kimberly-Clark Worldwide’sHuggies dropped TV ads from its marketing plan to emphasize the digital and print media its new mom target uses most. Source: Jack Neff, “New Huggies, Old Spice Launches to Go TVFree,” Advertising Age, May 4, 2009 (http://adage.com/article?article_id=136419).</li></li></ul><li>Method Assumptions<br />R O I = [(Return-Investment)/Investment] * 100<br />$250 Gross Profit per sale<br />
  5. 5. Direct Mail Return<br />$500 for 1000 direct mail pieces<br /> 1% response rate = 10 responses<br /> 25% close ratio = 2.5 sales<br />[($625-$500)/$500] * 100<br />ROI = 25%<br />Notes & Observations (ROI does not take into consideration)<br /><ul><li>DM has a natural geographical barrier
  6. 6. Response time is at the mercy of the Post Office or Express Mail Carrier
  7. 7. “Junk Mail” connotation</li></li></ul><li>Social Media Return<br />[($30,000-$7,750)/$7,750]*100<br />287% ROI<br /><ul><li> The average lifetime value of a customer is $50,000 at a 10% profit margin
  8. 8. The average monthly cost of delivering a social media strategy is $7,750
  9. 9. .1% conversion rate
  10. 10. 10,000 followers
  11. 11. Audience = # of direct followers + # of followers-followers*20%</li></ul>Notes & Observations (ROI does not take into consideration)<br /><ul><li>SM is instant
  12. 12. SM is global
  13. 13. Always “Opt In”</li></li></ul><li>Email Campaign Return1<br />1000 email addressees<br />4.28% click rate = 43 clicks<br />25% close ratio = 11 sales<br />Investment = $0.75 per addressee (development/creative time included)<br />[($2,750-$750)/$750]*100<br />ROI = 267%<br />Notes & Observations (ROI does not take into consideration)<br /><ul><li>EM is limited to the size of the CRM or “purchased” leads
  14. 14. Delivery is at the mercy of “spam” filters and company firewalls
  15. 15. May be “opt in or opt out”</li></ul>1 - Source: MailChimp (Average Open, Click, Bounce And Abuse Complaint Rates By Industry, 52 industries)<br />
  16. 16. Conclusion<br />1st<br />2nd<br />3rd<br />High ROI<br />Immediate<br />Global<br />Multi-functional<br />Easy Analysis<br />Multi-user control<br />Opt-In only<br />High ROI<br />Immediate<br />List limited<br />Filters / Firewalls<br />Slow<br />Never Opt In<br />Connotation<br />Geo-limited<br />Sampling<br />Creativity<br />

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