A preliminary effort is underway to develop a response rate study for promotion tactics. Such metrics have long been sought after by agencies and brands alike, and are a key component in developing budgets and determining return-on-investment.
If the industry-wide study comes to fruition it would be the first of its kind for promotion, an industry that has typically been unwilling to share response rates and other metrics considered proprietary. The study would seek to establish performance benchmarks for promotion marketing tactics, such as sweepstakes, games, contests, rebates and others.
The Promotion Marketing Association has taken the lead on the project, initiated by Marc Wortsman, executive VP of Marden-Kane, a promotion marketing agency in Manhasset, NY. Wortsman is also a member of the PMA Research Advisory Board.
“We saw a need to come up with a benchmark study for response rates,” Claire Rosenzweig, the president of the PMA, said. “And we would like to get off the ground as soon as possible because the industry is asking for it.”
Clients continue to put added pressure on agencies to come up with reliable tactical response rates.
“Promotion marketers are asking for more relative, reliable research to contribute towards better budget planning, to manage client expectations and to gage results against industry benchmarks,” Wortsman said. “We can’t plan subjectively anymore. We really have to provide hard data.”
Karen Sauder, executive VP at Zipatoni, St. Louis, said she thought that a response rate study was a “great idea”. She said that Zipatoni, like most agencies, used internal results to project ROI for clients, but believed that the industry would want to participate in and would benefit from such a study.
“For the industry to come out with a much broader study would be helpful to clients and agencies in projecting return-on-investment and marrying the right kinds of tactics with the right promotional programming for each client,” she said. “I think the industry wants to continue to validate why promotions are very effective and a cost efficient part of the marketing mix.”
The concept for the study is at the fact-finding stage to determine its feasibility, he said.
The direct marketing industry, also notorious for keeping response rates close to the vest, recently participated in its first response rate study, conducted last year by the Direct Marketing Association. Participation surpassed the initial goal of generating at least 1,000 responses, resulting in 1,500. The report covers 12 media channels across 23 industries for four different campaign objectives (direct order, lead generation, store traffic and fundraising).