Portland Marketing Analytics (PortMA) | Portland, Maine

Segmenting Your ROI – Why You Should do it Every Time

Segmenting Your ROI; Why you Should do it Every Time

The segmenting ROI model created by PortMA may be the most important metric of an experiential marketing campaign. It is a means of measuring the value of the results of multiple aspects of a campaign that experiential marketing generates for a brand. It is the evidence that a campaign has produced, and will continue to produce, results.

Because experiential marketing is about measuring individual and group human interaction, it can be more expensive than more traditional forms of media outreach. An ROI metric, such as PortMA’s segmenting model, may be necessary for a brand manager to justify the expense.

Some clients who are new to our process assume that ROI is applicable only for the overall program. That’s because ROI has typically been a bottom-line concept. The emergence of Big Data analytics, however, is helping business leaders at all levels to realize that every profit center, every department, every product,  and every project can, and should be, measured for its return on investment.  The bottom-line ROI model is just the start. ROI models need to be segmented logically in order to see, in our case, which aspects of an experiential marketing plan are creating the greatest return. Here are some basics for how to do that.

The most common ROI segmentation fields are:

  • Event type (example: retail vs. special event)
  • Venue (example: music festival vs. state/county fair)
  • Market (example: East vs. West Coast)
  • Activation Team (example: National Tour 1 vs. National Tour 2)

You can segment an ROI really any way you want. While how you segment your ROI is important, why you do it is even more so.

The most important reasons for segmenting your ROI are:

  1. To validate the model. A client may be skeptical about the estimated value that a program has been projected to generate, because there may be variables, such as simultaneous advertising efforts, that our model may not take into account. This doesn’t mean that our model is impractical, immeasurable, or invalid. It just means that it is important to validate it within its own universe. That is what segmenting ROI does.
  2. To give your team actionable insights on how to generate a greater ROI in the future. When you segment ROI, you arm yourself, and your team, with the activation scenarios that allow you to generate the greatest return on your client’s dollar in the present. It also allows you to offer recommendations on how to generate greater returns for your client in the future.

Why is segmenting important?

An ROI model is a powerful metric for an experiential marketing account manager. Demonstrating overall value is important. Segmenting the ROI provides additional model validity and insights upon which to offer actionable recommendations on how to create better campaigns with each extension.  Done successfully, you can earn repeat, results-driven business year after year.

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