Should you be worried about a low initial ROI?

Should you be worried about a low initial ROI

By Rhys Jones

Low initial ROI snip

When it comes to Shopper Marketing, we are often asked what ROI constitutes a ‘bad’ ROI for a particular piece of activity. Whilst at first it may be tempting to class anything that doesn’t return at least £1 back for every £1 spent as having underperformed, this ignores the subtle nuance of what some aspects of Shopper Marketing are all about: i.e. Brand Building.

As the infographic here shows, although ROIs for certain Shopper Marketing activities may initially be low, such activities can often contribute vast amounts of baseline incremental demand for a product, leading to higher ROIs further down the line.

This is an important consideration, particularly for new entrants looking to establish themselves within a category.

Any evaluation should therefore consider both the long and short term aspects of Shopper Marketing performance, so as to avoid prompting the wrong investment decisions.