The short answer: a campaign pays off when the margin on the sales it brought in is greater than what it cost. You work out the cost before sending (credits × price per SMS at your tier); you measure the margin afterwards, with a code or a link of its own. The number that tells you whether it is worth it is the break-even point: how many sales you need to pay for the campaign.
1. The cost, before you send
Credits = numbers on the list × parts in the message. Cost = credits × price per SMS at your purchase tier. The SMS Center shows the credits before you confirm, and the price tiers are on the SMS page.
| List |
Parts |
Credits |
| 2,000 numbers |
1 |
2,000 |
| 2,000 numbers |
2 |
4,000 |
| 5,000 numbers |
1 |
5,000 |
Add what the campaign gives away: the discount, the gift, the free coffee. A "20% off everything" campaign costs the credits plus 20% of every sale it brings in.
2. The break-even point
Sales needed to cover the campaign = campaign cost ÷ margin on one sale. The margin is what is left from a sale after paying for the product and the discount.
An example without prices: if the campaign costs the same as the margin on 10 sales, you need 10 sales to break even. On a list of 2,000 numbers, that is 1 response in every 200 (0.5%). If experience tells you that you usually get more than that, the campaign pays off; if you are unsure, test on a small group first.
3. The result, afterwards
| 2 |
Add up the margin on those sales.
|
|
| 3 |
Return = margin − cost. If it is positive, the campaign paid for itself and made a profit.
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|
| 4 |
Log it in a spreadsheet, to compare campaigns, groups and offers over time.
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What the maths misses
| Effect |
Why it matters |
| Customers who come back |
A customer won back by a campaign may keep buying for months. The real value is more than the first sale. |
| Sales without a code |
Some customers come because of the SMS and forget to show it. What you measure is the minimum. |
| Opt-out requests |
A campaign that sells but drives lots of people off the list spoils the next ones. |
|
Do not measure only the first day. Count responses until the offer ends. And compare like with like: a Christmas promotion and a February one are not comparable.
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