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How to Tell if Your Ads Are Working

You do not need special software to know whether an ad paid off. You need a habit of counting and a few simple tricks.

Ask every new customer how they found you

Put a tally sheet by the register or the phone. Ask, write down the answer, and add it up each week. It is not perfect, but it points in the right direction.

Give each ad its own way to be counted

• A different phone number or a code word for each place you advertise. "Say POSTCARD for a free extra" tells you the postcard worked.
• A separate web address or page for each campaign.
• An offer that is only in one ad, with an end date.

Work out your cost for each new customer

Divide what you spent on a place by the number of new customers it brought. If you spent $400 on search ads and won 8 new customers, each cost $50. Compare that with what a customer is worth to you, as in our guide on how much to spend.

Give each place enough time

Judge a place after several weeks, not after two days. Mailed postcards take time to arrive, and people often see an ad a few times before they act. Look at the trend from week to week, not a single day.

Change one thing at a time

If you change the offer, the headline and the budget all at once, you will not know which change mattered. Change one, wait, and look again.

Move money toward what works

After a few weeks, take some money from the place that costs the most for each new customer and give it to the one that costs the least. Do it in small steps and keep counting.