The performance of your annual investment

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For example you may want to test over a specific time period. Content marketing channels, social media channels, campaigns, or customer touch points. Product add-ons or upgraded promotions. Pay-per-click advertising models and campaigns once you have achieved sales results within the time frame of your choice. You can use tools like Insights and Dashboards to collect historical sales data from previous promotion-free periods and create a simple chart like the one below. Total annual sales With this chart in hand you can now move on to calculating incremental sales figures. Incremental Sales Formula Using the above example chart one can easily substitute the total sales for the annual promotional period into the following formula Incremental Sales Total Sales Baseline Sales Incremental Sales.

Baseline Sales However to get the Baseline Sales for the same period i.e. You'll need to make some educated guesses about the sales you can typically expect to generate during this period. A common approach is to roughly calculate a company's average annual sales growth using the previous promotion-free periods in the chart as shown below. Average annual sales growth Now you can calculate the annual sales base sales you would typically expect to see and Email Marketing List put that Plug the amount into the incremental sales formula. Annual Base Sales Year Average Annual Sales Growth Incremental Sales  Make sure not to confuse increased sales, in this case dollars, with profit. Since most marketing campaigns, while being a measure of profitability, come with a price tag you need to subtract the cost of the advertising campaign or promotion from the incremental sales figures to measure the financial benefits gained.




Factors You Need to Consider That Affect Sales Variance Measuring incremental lift can be particularly beneficial in determining whether your marketing is working within a specific segment, according to The Nielsen Company. The company says in the article that if you're trying to attract a specific audience and that group isn't getting a big lift you can change your message or offer to reach them more effectively. But while promotions drive sales, interpreting the calculations isn't always an exact science. For example, as we've seen baseline sales estimates rely heavily on best guesses derived from historical data. It's also important to note that total sales or gross sales may not just be affected by the marketing campaigns you want to measure.