How to Measure ROI from MDF Funds

by Bob Hunter

When your executive team asks how effective was the MDF program last year, do you have a reply ready? I’m sure you’re looking for a simple solution here—just tell me what to measure, and I’ll come up with some stats for the boss. While I’d be happy to comply, the fact is that there is no simple answer. 

This probably isn’t the answer you wanted to hear, so let me elaborate. How you measure ROI depends on several factors. When you’re asked the measurement question, your first response should be another question, “What are your objectives for the program?” Too often, the response I hear is “I don’t know.”

So I ask, “How can you know what is effective or not effective, if you don’t know what the objective is?”

My first piece of advice is to map out all of your objectives, then give each and every single one of them measurable goals. This becomes your starting point. 

Step 1: Define Your Objectives
This first step can include tangible and intangible objectives for your MDF program. Some typical ones are:

  • Increase sales of specific products/services
  • Increase sales overall/in a specific market
  • Increase mindshare/reinforce brand messaging
  • Increase partner/retailer loyalty

There are different ways to measure effectiveness against objectives. Some rely on a more quantitative approach of measuring sell-through. Others include a more qualitative approach (i.e., survey). Some can be short term, to address certain market conditions, while others may require an ongoing, long-term approach. You might have many more objectives, but just be sure that each one you identify is measurable. And most importantly, make sure that you have marketing strategies in place to meet the goals for your objectives. 

Step 2: Identify Your Goals
Now it starts to get more complicated. You’ve got your objectives laid out, so you need to define the goal(s) for each one. And once your goals are in place, think about how you’re going to establish a baseline for each one, to use as your starting point to measure progress. This tells you where you are now, which is pretty important to help you figure out how to get to where you want to be. Since objectives can be measured differently, you need to define the metrics, or the key performance indicators (KPIs), that each one requires. Then, think about what strategy you will use to attain each goal. I told you it gets complicated. This step in the process takes time and consideration, but it’s important for establishing the foundation of your MDF program.

Step 3: Set Up Reporting
Put in place a reporting system that will track your progress. As your program grows, strategies and tactics will evolve. You’ll adjust them over time, as you identify trends and see what worked—or what didn’t work. So it’s important to track progress not only for individual strategies, but against each objective, to continually improve effectiveness of your program.

Hopefully, these steps will help to make ROI measurement for your co-op programs a little less complicated. Invest in a little time up front—the pay off is well worth it. Don’t let those MDF funds go unused anymore.


OC_r_coverMarketSource has the tools and the strategies you need to make your programs a success and to show ROI to your executive team. Click here to download the first guide in our retail guide series, “Optimizing Retail Market Coverage


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Topic: Consumer Electronics Market Research


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