The figure that shows the total income does not take into account the distribution of amounts between sales channels. And this is extremely important, since it is for them that the DRR needs to be calculated.
There are several ways to collect such information. Some companies ask the client directly, while others connect end-to-end analytics to CRM.
Metrics on the site
Source: shutterstock.com
All money that was allocated job seekers data package for advertising purposes is recorded in the personal account of any advertising program. Income amounts are reflected in the CRM or other accounting system, for example 1C. With a single traffic channel and one product, this is enough. If the business is associated with the sale of several hundred or even thousands of products and advertising channels for promotion are much more than one, you will have to connect the end-to-end analytics system to the work. It tracks how exactly the client chose to contact the company for cooperation (via messenger, by clicking on a link posted by a blogger, or after watching an advertisement on TV, called the specified phone number).
What is interesting is that the income should take into account all revenue from one customer, and not a one-time purchase.
Let's understand the importance of this point using a specific example.
Let's imagine a girl who visited a beauty salon and got photoepilation for 3,000 rubles. The salon's management spent exactly 3,000 rubles on advertising to attract one client. The initial calculation of the DDR will be 100%, which shows that such advertising is absolutely unprofitable for the salon.
But it is not taken into account that in order to get the desired result from photoepilation, the girl will have to visit the salon 10 more times at least in the next 12-14 months. Each subsequent appointment with a cosmetologist will still cost 3,000 rubles, but you will not have to spend more money on attracting them. It turns out that the salon will make a profit even from one client, not to mention the fact that there will be about a hundred such visitors per year.
Case: VT-metall
Find out how we reduced the cost of attracting an application by 13 times for a metalworking company in Moscow
Find out how
Another clear example.
A man saw an ad for a popular online movie theater and decided to subscribe to a 14-day trial period for 0 rubles. During this time, he will definitely start watching several series, he will like that the episodes are shown without advertising, they are all collected in one place and, in addition, you can choose the best quality, add subtitles, voiceover, etc. When the trial period ends, he will pay for a subscription for the next period. And he will do this for several months. Such a man can be considered a loyal consumer, and there is no need to lure him with advertising every time.
Companies should not be afraid of exceeding advertising costs over revenue. At some stages, this situation is quite normal. Especially if we are talking about the initial stage, when the target audience is just beginning to recognize the brand. It is important to consider the business sector. For example, a billion rubles were spent on building a plant, and in a year it brought in 300 thousand in revenue. It seems that this is a complete failure and such activity is ineffective. But you can’t evaluate work of such a scale in just a year; conclusions are made after several years.
It is incorrect to include only the cost of advertising placement in the numerator of the DRR indicator - it is necessary to take into account the budget, the salaries of the team's specialists, and the costs of software.
Recommended articles on this topic:
Marketing Tips: How to Show That Your Product is the Best
How to get contacts from a client: the most effective methods
Examples of USP to make yours even cooler