Return on investment of marketing - Looking into costs

Hello all,

In the pizza business, what is the average return on investment for specific advertising and using beta coupons etc. in a local neighborhood?

My place is going to be reaching out to an area with 20,000 people. There are 4,000 homes in this area.

What should I be focused on? Some ideas I have had are door hangers (what is the cost per?) box toppers (again, what are the cost of per?) a little over the radio, but that is $25.00 per 30 second commercial and facebook is $1.36 per click that leads a consumer to your website.

what other options do I have really?

Facebook does not have a set price. More effective campaigns often cost less if you bid them by impressions rather than clicks.

$1.36 is cheap! I would not suggest that you direct FB ads to your website… I would send to your FB page. The purpose of a FB click is not to generate an order, it is to gather them into the fold so you can communicate with them regularly from then on. Provide a link to get to your ordering site from there. We have little over 1500 FB fans now. Everthing I post on our wall gets 800-1500 impressions and those posts are FREE. Great for keeping us “top of mind” in the consumer.

We have had particular success driving on-line orders from the FB page, but it is done over time, not “place an ad and get clicks that are orders” We now have about 850 online customers and I can send them emails with special offers. It costs me about $8.50 cents to send them all an email. The last emai I sent generated over 40 orders but it was pretty agressive. More typical is 15-20 orders.

Direct mail to the number of households you have plus businesses in the area etc is also likely to be pretty effective. Again, our last offer was agressive, but we have received about 400 orders from a 10,000 piece mailing. The BEST offer in that mailing was only valid online… that added nearly 200 new online accounts. What is that worth?

Box toppers are a no brainer. They should go out on EVERY box that leaves your store. In quantity, it costs us about 2 cents each for 5.5" X 8" color toppers. We have four offers printed on them. Over the last 12 years, this is by far our lowest placement cost per order recieved for any coupons we have out there. (Email campaigns may give this a run for the money in the future)

I’m falling back to a baseline question I always ask myself or others: What is your objective/goal?

  1. Gaining new customers . . . every customer you add will net you around $700 to $800 in the next year
  2. Adding repeat sales from existing customers . . . this is a short term return, and would probably be along the rates that bodegahwy posted above. We used to get (from a direct mail piece to 1200 addresses) a three-week bump of about 30% gross sales. Nice turn-around since it also had the repeating bonus of getting about 20 to 25 new customers every time.
  3. Increasing ticket average . . . this one can be tougher to measure, but doable with the right math. You get a small bump on a lot of tickets over time. I have not had this as a measurable goal since we’ve been quite content with averaging $20+ per ticket (even in these slow times!)
  4. Simple dollars over gross sales . . . this is a sort of simple measure, but gives you a feel-good.

What is it you are looking at accomplishing, and then we can give a much better answer to what you are asking. Different marketing tools yield different results for each of the above items. there are still more goals, just listed the ones I usually looked at.

I appreciate the help. When setting up the facebook page it asks you to type in buzz words and it will advertise to local people who fit in these categories. What are some of the ones you picked?