Both traditional retailers and pure-play online e-tailers use multiple channels to attract buyers and drive sales. For digital efforts that can be linked to a sale, measuring success is relatively easy.
But when it comes to measuring a print or digital catalog’s impact on sales, marketers must evaluate the return on investment by examining purchases from verified catalog recipients. To do so, marketers need to take two types of metrics into consideration: direct and indirect.
Measuring indirect influence on purchasing requires looking at the other stimuli present during a defined period, including any related broadcast commercials, e-mail campaigns, print ads, social media activity, search term marketing, and press mentions.
All of these touches may have influenced catalog recipients’ purchases from Web sites. It is important to measure the impressions and reach of these tactics and attempt to tie them back to actual sales through Web analytics. If possible, marketers should match a purchase’s time stamp and location data to ads that ran regionally in newspapers or on radio and cable. A six-week benchmark post-mailing should incorporate the impact of most non-catalog influences.
The direct influence, however, is the most critical measure of a catalog’s payback. Marketers can use several tactics to measure sales effectiveness, such as inkjetting special discount codes onto the catalog, or presenting some stock-keeping units (SKUs) that appear only in its pages.
These strategies will offer valuable data, but they won’t tell the whole story. Marketers rarely get 100% compliance with the discount codes, and the SKU method won’t reveal whether catalog recipients came to their sites and purchased products that were not featured in the catalog. Marketers must use matchbacks to see the full picture.
A matchback entails isolating Web site customers during the six-week benchmark period and comparing them with the original catalog mailing list for that campaign. Marketers should generate a database of matches between their customer list during that period and the catalog circulation file for a given campaign. Ideally, the original list sources will be appended to the report.
Marketers can then mine this mountain of data for valuable information, such as:
Purchasers sorted by segment. For example, targets can be categorized as prospects, current buyers or even lapsed customers who were reactivated thanks to the catalog.
Total sales driven by the catalog. This can be analyzed by dollars, product mix or specific brands purchased. Marketers should also compare average order size from catalog buyers with that of other customers.
Other products purchased. In addition to the products offered in the catalog, customers may have bought other items as a result of being on the site.
Overall match rate from the catalog. What percentage of recipients receiving the mailing went online and made a purchase? In which customer segments? And were they new, current or reactivated?
List performance by revenue and customer segment. Do specific lists drive more revenue? Did one source do a better job of generating new customers? Be sure to factor in list costs when calculating revenue and net profit per mailing.
With all this in hand, marketers can calculate a preliminary ROI for the catalog, which includes production, design, list acquisition and mailing costs. This ROI projection is preliminary in that it should be part of an ongoing process and analysis.
Customers (especially new or reactivated customers) who can be linked to a specific catalog should be flagged and followed over the course of several years to understand their lifetime value. The true payback for a catalog should be judged over a year, not just the initial six-week period.
After completing the matchback analysis, marketers should overlay the indirect marketing analysis and attempt to draw patterns and conclusions from their marketing communication, advertising, PR and social media campaigns. For example, did a TV campaign in a particular metro area result in a rise in catalog sales corresponding to those dates and times? Do Web analytics show a boost in Facebook or Twitter Web referrals to particular landing pages, or to the digital version of the catalog?
All of this information will give a full view of the six-week period after the catalog was mailed. That data should guide the next steps in designing marketing plans. But the key point remains: Those new and reactivated customers were probably seeing multi-platform messages all along, but they didn’t pull the trigger to purchase until a print catalog showed up in their mailboxes.
Gordon Plutsky is director of marketing and research for King Fish Media.