Keeping ROI In Perspective

Written by PortMA

Keeping ROI In Perspective

Perspective We recently finished our research for a very successful mobile tour for a well known, frequently purchased (70% of consumers reported they were current customers) food product. Consumers loved the event experience and the samples that were distributed.  
This was really apparent in the data:

  • 93% liked the samples they tried
  • 72% reported more positive perceptions of the brand after their experience
  • 88% reported they would make a purchase in the future. this was a significant 17 percentage points higher than experiential purchase impact averages

All of this was great news. The client loved it. They had worked hard on the tour and it clearly paid off, both qualitatively and quantitatively.

When it came time to present the ROI, the client started to get nervous.

We didn’t see a positive return from the Mobile Tour until year three! That was easy to explain and it did not take away from the success of the program, once it was put into perspective:

  1. The penetration of the product in the national market is huge. Seven in ten (70%) consumers who attended an event were already current customers.
  2. The product was low cost ($1.50 per SKU), so incremental customers did not add a lot of revenue.

While we like to show a positive value to the client, it is more important to put the ROI in perspective.

Before dismissing a Return-on-Investment, put it in perspective:

  • Where is the incremental value coming from? Is the product or service already widely used? Is it designed for a niche market?
  • What is the actual value that will be generated from incremental purchases? Is it a low-cost good that may be purchased often, but doesn’t generate a lot of revenue per purchase? Conversely, does the good or service have a high cost that requires a significant investment on the part of the consumer that might hinder or reduce purchases?
  • Are there other sources of value that can be included outside of physical purchases? In this case, a huge PR and social media campaign was created as a result of the mobile tour that was able to contribute to the overall value of the program.

While we like to show the value of a program in tangible dollars and cents, it shouldn’t overshadow the intangible (and very real) impact experiential provides by introducing brands into the everyday lives of consumers.
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