Pacoima, CA, July 29, 2014 --(PR.com
)-- As a commercial grade inflatable business owner, it can often be challenging to determine whether you are getting the most out of your marketing dollar, and how profitable your inflatable business is as a whole. Is the money that you spend advertising and marketing your business paying for itself in new business won? Is your inflatable rental pricing sufficiently covering all expenses, while turning a profit? These are critical factors in any business’ success, and ones that you should know the answer to.
We throw out terms like Marketing ROI (Return on Investment) and Cost Per Lead, but coming to these actual numbers can be a bit challenging for even the most savvy inflatable business owner. It is important to first understand the difference between ROI and Cost Per Lead. ROI is calculated based on actual sales dollars and income. Cost Per Lead is new business prospects, not necessarily resulting in customers yet.
You should calculate your business’ ROI on both a monthly and yearly basis to get the big picture of your commercial grade inflatable business’ profits versus expenditures. This number is generally calculated and referred to as a percentage. Your marketing ROI can be calculated using the following formula: (Profit – Cost)/Cost.
Cost Per Lead is a simple equation that just requires you to diligently keep track of your inflatable business. You can break this number down by month, year, or both. Cost Per Lead is calculated by Marketing Expenditures/Leads. To keep track of your total monthly and yearly leads, you will need to keep a diligent record of new prospects via your web site, phone, and emails.
Even with these numbers, the challenge remains to determine if these are “good” stats for your inflatable business, or if there is reason for concern. There is no set number that indicates a good ROI or Cost Per Lead. Instead you will have to look at the big picture of your inflatable business. Before any of these calculations you should have a good understanding whether your bounce house business is in a comfortable financial situation or is struggling. Looking at the ROI and Cost Per Lead can give you a good indication where any problems may lie.
A low ROI or high Cost Per Lead can indicate the need for a change in your business. Low ROI percentages could indicate the need for a price adjustment, reduction of expenses, or both. A high Cost Per Lead could indicate that you need to re-evaluate and modify your business’ marketing plan to lower costs and utilize more effective mediums that will generate a greater number of leads.
Whether your inflatable business is thriving or struggling, these numbers are important to stay on top of and identify any trends or changes in your bounce house business.