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Love Furniture Profits Tip: Don’t be fooled by Response Rates

Furniture World News


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By David Love
Love Furniture Profits


Don’t get lured in by the sexiness of response rates. However, they really don’t have much to do with how much money you make.

Response rate is the sheer volume of responses you get to a marketing effort. For example, if a mailing of 5,000 post cards at a cost of $2,000 yields 50 responses, that would be a 1% response rate. That probably doesn’t get your heart racing.

Let’s say each of those 50 responses spent just $500 with you. That’s $25,000. A 5 to 1 ROI. Could be worse. Certainly could be better.

Remember, it’s been estimated that your customer is worth 10 times their initial purchase.

So the lifetime value of those 50 responses is very conservatively $5000. Looking at it this way, all of a sudden, your return on this mailing is $250,000. I'm not very good at math, but I do know that’s a really good ROI.

Now, granted, you’ll spend additional monies over the years to keep in touch with and re-attract that customer, but you get the idea.

I learned early on that you can’t take percentages to the bank. Only dollars.

These little weekly articles can only scratch the surface. To find out more, go to www.lovefurnitureprofits.com to download your $97 (but free to you) Special Report. “5 Long Lost Secrets of Scientific Furniture and Mattress Advertising that work like magic in today’s economy to get you more customers, more sales, more profits.” David can be reached at david@lovefurnitureprofits.com. Phone: 803.764.3977.
       
About David Love and Love Furniture Profits. Love Furniture Profits is an advertising consulting and coaching firm that works with furniture and mattress stores that are frustrated by less than stellar results from their advertising.

David is a 42 year furniture/mattress, in the trenches, industry veteran. His background includes retail furniture sales. Manager of a retail furniture store. 22 years on the road making money for companies like Sealy Mattress and Best Chairs. His territory and his retailers achieved sometimes remarkable sales increases due to the expert advertising and sales advice he gave. He has also owned and sold his own profitable store and was a highly regarded sales manager of a top 100 furniture store.

Furniture Industry News and in depth magazine articles for the furniture retail, furniture manufacturers, and furniture distributors.
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