Assessing the effectiveness of drive-to-store campaigns by measuring incremental visits generated is the gold standard for the location-based marketing industry, but that standard has been lacking in established, industry-specific points of comparison.
Enter S4M, which is hoping to set standards for the entire industry’s measurement practices with the release of a new online calculator.
Following the analysis of more than 100 drive-to-store campaigns, and the release of cost-per-incremental-visit (CPIV) benchmarks, S4M is launching a calculator that advertisers can use to estimate the ROI from their drive-to-store campaigns, using industry-specific parameters.
The company analyzed benchmarks in seven industries, looking at millions of ad impressions and store visits occurring between January and July of 2018, and found that the price of an incremental visit to a store is directly correlated to the average purchase value of the industry, as well as the frequency of purchases. For example, S4M found that the average cost-per-incremental-visit for an industry with a high purchase frequency, such as a fast food chain, is $3. At the opposite end of the spectrum, the average cost-per-incremental-visit in the automotive industry, which has one of the lowest purchase frequencies, is $75.
According to CEO Christophe Collet, S4M’s CPIV benchmarks and online calculator are the first of their kind, relying on data from the company’s recent study.
“The option to pay using the CPIV model is relatively new. In fact, a year ago there was an absence of vendors offering it altogether,” says Collet. “However, after running a number of these campaigns, we feel it is important to share these benchmarks.”
In the past, Collet says advertisers running drive-to-store campaigns typically paid for the total number of visitors under the cost-per-visit model. This meant they were also paying for organic traffic and footfall influenced by other media. Changes in the market are making it so that retailers are finally recognizing the significance of measuring incremental visits, but Collet says many are still taken aback by the cost.
“As a marketing technology provider, we believe our role consists of educating the market about the value of incremental visits, which is why we are providing these benchmarks as well as the calculator,” Collet says.
Collet envisions brands using S4M’s new calculator to justify the importance or the value of their drive-to-store campaigns. He also expects to see more brands shifting from using the cost-per-visit model to the cost-per-incremental-visit model, due mainly to the increased understanding of the value of the incremental visit.
“Incremental visits are based on calculations that represent a more accurate picture of foot-traffic that can be directly attributed to an advertising campaign,” Collet says. “With an increased level of reliability, advertisers can say their ad campaign led to more sales and revenue.”
Given the results of S4M’s analysis, coupled with its new calculator, Collet believes brands should be rethinking the way they target consumers and put more emphasis on the ROI from their campaigns.
“Brands should always start with putting the consumer first, including rethinking the way customers are geotargeted, “ he says. “Next, pay for what matters, incremental visits, and remember to do so in real time while filtering out fraud. Finally, make sure the effectiveness of the campaign is assessed with impartiality by a third party.”
Stephanie Miles is a senior editor at Street Fight.