Yellow Page Advertising, Part 4: Return on Investment

Sep 10, 2010   //   by John Tabita   //   Advertising, Business  //  No Comments

Anyone who’s read a business book or gone to college should know ROI is a number derived from a simple mathematical formula.

Ian Sohn over at Flagged For Follow Up made that statement on a blog post about ROI. He’s absolutely right. Here’s a simple mathematical formula:

1. How much revenue do you want your advertising to generate each month?
Pick a realistic number. In my hypothetical example, I’ll use…

$5,000

2. What is your average sale?
If you have multiple products, think about what your average customer spends.

$1,000

3. [Now divide $1,000 into $5,000.] The number of sales you need is:

5 sales

4. How many prospects must you speak with to make 1 sale?

6 prospects

5. [Now multiply 5 sales x 6 prospects.] The number of calls you need is:

35 calls

So to sum it up, 35 calls a month would result in 5 sales and bring in $5,000 a month.

This is an example of what a transmission shop could expect from Yellow Page advertising.

Remember in my previous post that I said you could get significant advertising in many independent directories for less than $3,000 a year? Spending $3,000 a year to get $5,000 a month x 12 (i.e., $60,000) is a 20:1 return on your investment.

And they say Yellow Page advertising doesn’t work…

John Tabita

Marketing Evangelist and Blogger at SitePoint.com. Digital Strategy Director at HainesLocalSearch.com. Passionate about helping people and businesses reach their fullest potential and become wildly successful.

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