What is Experiential Marketing?
Experiential marketing, sometimes called emotional marketing, aims to create interaction with target audiences of brands in a way that evokes emotions and creates a connection. It does not focus on product attributes, but goes beyond to the framing story and seeks to influence the values it represents. Experiential Marketing will not tell you about a car but about freedom, not about flowers but about love, thereby turning a product into emotion, desire and passion.
Experiential marketing activities are often held at customer events, conferences or exhibitions, or as part of broader marketing campaigns. Experiential marketing allows exposure to a product or brand in a way that creates impact, leaving a meaningful long-term memory. The visitors is in an interaction where they take a stand, creates, evoking their emotions and thoughts to have sense of commitment. The result, along with other marketing tools, contributes to increasing the customer base and sales, but that is not always the main immediate direct goal.
Experiential marketing events create a new and interactive brand experience. The approach is becoming more and more popular among brands as it provides a distinct, creative, unexpected and therefore very memorable way to keep the brand and products in mind over time. Since this is a long-term approach, sales results are not immediate, so with all the significant advantages of the approach, measuring return on investment (ROI) can be challenging. Here are some tips to help you measure ROI at brand experience events.
What is not Measured cannot be Managed
Before planning a brand experience event, it is important to define your goals and objectives. What do you want to achieve with the event? Do you want to increase brand awareness, generate leads or boost sales? Create buzz? Respond to competitor activity? Defining your organization’s goals and objectives will help you characterize the activity, set the budget, and measure the success of the event.
On Quantity and Quality (The Art of Defining KPIs)
After defining your goals and objectives, you need to set the KPIs (key performance indicators) that will help measure the success of the activity.
Here are some common KPIs for brand experience events:
Reach
The number of people who participated in the activity or event, offline and online. It’s important to define what constitutes active participation, such as: a visitor who came to the booth, a guest who answered a questionnaire, a customer who accessed a digital asset following the connection, etc.
Engagement Quality: The participants’ engagement with the brand – did people visit the booth for enough time to create interaction? Was the conference activity attractive and aesthetic enough that audiences chose to be photographed with it? Was the demonstration compelling enough that everyone completed it? These are all signs of engagement quality.
Social Media Mentions: Social media may be the easiest to measure but opinions differ on the quality of the metric. The number of mentions on platforms like Twitter, Instagram or Facebook can indicate interest, depth of interaction but also popularity that does not necessarily translate to conversion versus other tools like direct lead collection.
Sales or Leads: The number of sales generated as a result of the event, leads and details that visitors proactively left for further contact.
Data Collection
In order to measure the ROI of a brand experience event, we need to collect data throughout the year and especially during the activity period, in order to see the changes.
Surveys: Compare surveys conducted before the start of experiential marketing activity and after the activity. From the data comparison infer how it affects brand resilience and connection.
Lead Forms: Especially at conferences, we all want to collect as many emails and data as possible to target our marketing. But if we don’t provide value, a small gift or create cool interaction, the response rate for providing details will be low. Therefore, it is advisable to create an activity that will motivate the audience to participate, provide relevant information so that we can focus our marketing efforts going forward. An example of such activity was created at the Ytong booth, where during the first round of the activity, participants received bags with a cool activity kit and joined Ytong’s mailing list – over half of conference attendees.
Social Media Monitoring: Your media manager surely knows how to track volume of tags and social media mentions post-marketing activity. Equally important is how you encourage your audience to be part of the tagging. For our launch activity for Nespresso Vertuo, we opened a pop-up store in Dizengoff Street. Every customer who tagged Nespresso #Vertuo got coffee in a branded mug with their name in exchange for the tag. The network burned with tags and the activity pulled over 10k visitors to a coffee house in under a month which translated to hundreds of thousands of online impressions.
Sales Data: Tracking sales generated as a result of the event is mostly relevant for B2B activities. Therefore, consult with sales people and team leads and define the time span after the event that impacts sales. This depends of course on product or service complexity and the quality of human connection with end customers.
Calculating ROI Return
After collecting the necessary data, you can calculate the ROI return on your experiential marketing activity. Broadly, if we invested 100k Euros and thanks to this investment we sold for 200k Euros, we are at a 1:2 ratio (200%) which doesn’t sound bad but you also need to net out production costs to get an accurate result. Similar to campaign goals in digital, it’s also important to price parameters that are not just sales, such strengthening the brand, exposures, resonance and engagement of the target audience.
Here is the ROI return formula:
ROI Return = (Total Revenue – Total Cost)
Total Cost x 100
Total revenue includes the sales generated as a result of the event, while the total cost aggregates all expenditures related to the event, such as production, venue rental, design, marketing materials and personnel costs.
Experiential marketing events create a new interactive brand experience. The approach is becoming more and more popular among brands as it distinguishes the brand in a creative way
Example Calculation:
The cost of producing a marketing activity including teams, inputs, and digital advertising around the activity was 350,000 Euros . Sales resulting from the marketing activity were 600,000 Euros .
600,000-350,000=250,000 Euros
250,000/350,000 = 0.71
0.71X100= 71%
Okay, so the return on our investment in the marketing activity we conducted is 71%. Wait, is 71% a good number or not? Excellent question! We need to compare this number to similar activities to understand if our ROI is good and efficient or if the activity did not generate the desired return.
Comparison can also be made to activities you conducted at previous workplaces, of course to the extent there are similarities in activity types, budget size and product or service nature.
Cost Per Touch – An additional measurement method is calculating “cost per touch.” This means, what was the cost per person for the marketing activity that was conducted. In other words, dividing activity cost by the number of people who experienced the activity, gives the cost per touch. It’s very important to compare activity types with similar characteristics. In order to compare apples to apples, quality of touch and duration of impact over time should be considered.
Analyze and Improve
Finally, it’s important to analyze the data you collected and use it to improve future experiential marketing events. Look for areas where you can make improvements, such as increasing engagement with participants, optimizing booth design or providing more value to participants.
Summary
Measuring ROI return on brand experience events and experiential marketing activities can be challenging, but with the right time perspective it’s possible to measure the success of projects, improve performance and amplify value for your customers. By defining goals and objectives, setting key performance indicators, collecting data, calculating ROI return, analyzing and improving, you can not only measure ROI return but also make your work plans a dream come true.
