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Potential Revenue Touched - The Trade Show Marketing Metric You Should Be Using
Every trade show exhibit marketer wants a method to quantify the value of their trade show participation (i.e. measure ROI) immediately after each show.
The ideal is a methodology where the exhibit manager doesn't have to wait six-months--or even six-years for leads to close. A methodology where the numbers aren't impacted by the sales team's success or failure to follow-up and close sales. A methodology that directly demonstrates the exhibit marketing team's contribution to the sales pipeline.
Potential Revenue Touched (PRT), a methodology developed by the 3D Exhibits metrics team, does exactly this.
PRT utilizes your lead gen system and your company's sales and customer averages to predict the volume of business opportunities likely to result from your exhibit marketing efforts. The benefits of this approach are:
- PRT demonstrates the value of your program to upper management by giving your efforts a quantifiable number of potential sales dollars you've touched--thus making it easier to earn recognition, budget increases and raises.
- Not only does PRT eliminate the need to wait out the sales cycle to calculate ROI, it separates the responsibility of the trade show team (to create qualified opportunities) from the responsibility to of sales (to close the leads collected). With PRT, your program gets judged on the volume of potential business you add to the pipeline--not sales' ability to close it!
How to implement PRT:
1. Collect and qualify your leads at the show. (You will only want to include qualified prospects in your calculation.)
2. Count the number of new contacts you designate as highly qualified.
3. Multiply this number by your company's average revenue for a new client sale.
4. Total all of this up to calculate the Potential Revenue Touched (or Value of New Leads) for your show.
5. If your company has an average close ratio, multiply that number by your result by your PRT to calculate the volume of new business the show will generate (assuming the sales team follows up on the leads).
Once you have these figures, it's easy to graph and compare results across all shows or across shows for a market. You can also cross-graph this with your budget for each show to illustrate which shows are yielding the best ROI.
Customize PRT for Your Company's Needs:
Of course every company operates just a little differently--so you may need to adjust the formula to meet your company's specific circumstances. For instance, if you are selling multiple product types, the calculation can be customized to take into account the specific product or products each lead is interested in. Varying average close rates across product lines can be accounted for as well.
For existing clients, you can calculate the current volume of annual sales these people represent, the dollar volume of upsell opportunity created--or both.
Examples of Specific Companies' Application of PRT:
- A dental device company knows that when it takes on a new practice as a client, the practice's spend will be $10K per dental treatment chair in the office. Therefore, this company also captures the number of chairs the practice has as part of its lead gen. From there, it is easy to calculate PRT by multiplying each qualified new practice by the number of chairs times $10,000.00.
- A custom app developer knows that new clients will purchase one of three different levels of app, so as they qualify exhibit attendees, they note which level of app the prospect is likely to purchase. Then they multiply the average sales price for each level of app by the number of qualified prospects interested in that level. Finally, they total these three numbers to get their PRT.
- A plumbing supply distributor knows that new customers typically spend less with them the first year of the relationship than in successive years. Therefore, the plumbing supplier has calculated an average annual spend for a new client during their first year that they use to calculate PRT.
Are you currently using Potential Revenue Touched to measure your trade show performance and ROI? If not, our 3D Exhibits measurement team would love to help you get started.
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