Comment: The 5 Rs of online advertising

Wouldn't it be great to create a famous and lasting business model along the lines of McCarthy's '4 Ps' marketing mix. (OK, it's now widely regarded as the 7 Ps, but the man knew what he was doing...)

I gave a presentation about online advertising in 2007, and used a model of '5 Rs' to help quantify the benefits of online advertising from the perspective of the all-important return on investment. It went something like this:

• Reach: how large is the media owner's audience?
• Relevance: what proportion of that audience is relevant to your offer - does it cater for your target market?
• Recognition: how does the campaign maximise the number of people that will recognise your offer?
• Response: ...and how many will respond to that offer? This is where traditional offline methods stumble.
• Return: and finally, how many can you convert in to actual sales revenue.

The presentation came and went, however I sat on the 5 Rs idea for a while and it occurred to me that they could be used to quantify and manage pretty much any marketing or advertising campaign. What's more, in reverse it also provided a simple model for judging marketing campaigns before you're committed.

And all with a focus on that last 'R': Return on investment.

Here's what I mean about the 5 Rs in reverse:

• Given the known cost of a marketing campaign, what sales volume would be required to make it worthwhile? = Return
• From what you already know about your lead conversion rates, how many qualified leads would you need to generate that return? = Response
• Based on your own experience and, importantly, advice from the media owner running your campaign, what exposure does your offer need in order to generate the required volume of responses? = Recognition
• Does the media owner's audience match the profile of your potential buyers, and is that proportion large enough to achieve the recognition you need? = Relevance
  
• And is the media owner's audience big enough to deliver the required number of relevant potential buyers for your campaign to be successful? = Reach
  

The first three Rs here need to be quantified in order for sound campaign decisions to be made. The last two Rs rely on an honest and trustworthy relationship with the media owner - what's more, discussing Relevance and Reach with the media owner can be invaluable in refining the content of your message and the call to action you're asking potential buyers to make.

We're currently planning for 2009 and I'll put the 5 Rs structure in place for our own marketing activities.

I guess that commits me to writing again on just how successful the 5 Rs turn out to be!