Basic methods of analyzing the economic efficiency of an advertising campaign

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Analysis of the effectiveness of an advertising campaign can be carried out using different methods. To understand its economic effectiveness, you need to use calculation methods.

They will allow you to obtain an objective and accurate result of the impact of advertising on the audience and evaluate the change in the level of profit of the enterprise. In this case, such physicians email list indicators as profitability, economic effect from the events held and additional turnover will be used.

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Profitability is the main indicator of efficiency. It is equal to the ratio of the income received to the costs incurred. In order to calculate profitability, you need to use the formula:

Pr = (P * 100) / U, where:

Pr — profitability expressed in %;

P — income received as a result of product advertising, in rubles;

U — costs of implementing advertising activities, in rubles.

Formula for calculating economic efficiency:

Pe = ((Td * Nt) – (Ur + Ud)) / 100, where:

Pe is the economic effect of advertising activities carried out, in rubles;

Td — additional turnover received, in rubles;

Нт — percentage of markup on goods;

Uр — expenses on advertising activities, in rubles;

Uд — additional costs associated with the increase in trade turnover, in rubles.

Economic efficiency can be calculated differently - by comparing actual data with planned data. In this case, the following formula is used:

Pe = ((Pfact – I) / (Pplan – I)) * 100%, where:

Pe is the economic effect, in percent;

Пфакт — actual profit, in rubles;

Pplan — planned income, in rubles;

And - costs for the PR campaign.

Let's analyze the effectiveness of an advertising campaign using the example of a small company manufacturing children's toys. The management planned to launch advertising to increase sales. The company's marketers decided to buy advertising in subway cars, placing it there for 1 month.

The cost of the project was 5,140,000 rubles, plus the advertising layout - 400,000 rubles and the production of stickers - 610,000 rubles. As a result of the actions of the advertisers, the sales volume increased by 41% with an additional turnover of 49,697,000 rubles.

Let's apply the formula and calculate the economic efficiency:

Pe = ((49,697,000 * 35) – (5,140,000 + 400,000 + 610,000)) / 100 = 14,847,600 rubles.

Accordingly, we can conclude that the advertising campaign was quite effective: its costs were fully recouped, turnover and profit increased. However, at the same time, it could have been significantly higher if the advertisement had been placed during periods of maximum demand for the product (for example, on New Year's and other major holidays).

Additional turnover is characterized by the cost of products sold after the advertising campaign. The calculation formula is as follows:

Td = (Ts * Pt * D) / 100, where:

Td — additional turnover, in rubles;

Ts is the average daily turnover, in rubles;

Pt - increase in average daily turnover as a result of advertising impact;

D — period, in days.

Experts consider the most illustrative economic method to be the calculation of ROI, that is, the ratio of the profit received and the costs of advertising. It is determined separately for each advertising medium.

ROI = (Gross Revenue – Advertising Costs) / (Advertising Costs) * 100

ROI below 100% is considered a bad result, such an indicator means that the advertising campaign has shown its inefficiency. A good result is from 120% and above.