How to Determine Your Return on Investment

How to Determine Your Return on Investment
How to Determine Your Return on Investment With direct mail outs, the response rate to an initial campaign usually runs at about .25% to 1%. This figure can be increased dramatically with follow up drives, some returning a rate of over 10%. Successful campaigns should generate enough revenue to cover all associated costs.

Measuring Success

The success of your mail marketing will be determined by the goals that you set. The first step is to identify the value of a customer to the long term success of your business. You can do this by using the calculator below.

A x B x C = D


A = average $ spent per customer

B = average purchases in a year

C = average number of years a customer is loyal to your business

D = average lifetime value of the customer.

Here are some of the actions you can take to help grow your business in the future;

Second Offer

Once a customer has made a purchase, follow up the sale with a call to action. This can take the form of a special offer, such as x% off their next buy. Including an expiration date will motivate the customer to redeem the offer sooner.


Running a promotion in conjunction with a non-competing business will reduce costs, while offering potential customers more benefits.


The best promoters of your business are satisfied customers. Providing incentives for these valued clients and their friends/family can be a huge boost when recruiting potential new business.

Get the most from your contacts

Your existing customers are your best prospect for future business. Send out newsletters, make exclusive offers, host buyers’ clubs, start a members’ loyalty program. If you can offer something unique you will increase your sales dramatically.

Try new things

Adopting the same promotional approach as you competitors will not set you apart. Try to think outside the square by promoting distinctive and individual campaigns, or by introducing a product or service unique to your business.