Entrepreneur Once you have started to gain attention for your new business through promotion, publicity and direct response marketing the careful use of advertising can greatly accelerate the rate at which you find and communicate with new sales prospects.
Advertising in its traditional form is the use of paid promotion in newspapers, magazines, radio and television. These media are designed to communicate with a wide variety of people all at the same time. This sounds very attractive to a new business looking to influence a lot of people quickly. However, you must realize that many of those who receive messages through these media may not be good prospects to buy what you are selling. They may have little interest in your category of goods or services. They may not have a compelling need to buy any time soon. Or they may not understand the value you offer.
As a result, of the 600,000 daily readers of the Chicago Tribune perhaps as few as 4,000-5,000 may be disposed to consider your product or service at the time you run your advertising. This seems like a very large number of prospects, but you should understand that they are very expensive to reach because the Chicago Tribune sets its advertising rates based on reaching more than 600,000 people each day. You will possibly connect with fewer than 1% of their readers on any given day but you pay for access to all of them.
The other major challenge in using traditional advertising effectively is that it is hard to attract attention if you don’t repeat your message often. I would guess that there are more than 2,000 ads each day in the Chicago Tribune. What will cause the reader you want to stop and read your ad? Often it is their repeated reading of your ad that finally gets their attention.
Repetition costs money. For example, a 2 1/2″ by 4″ ad in the Chicago Tribune costs almost $500 per insertion. This is not a large ad when compared with the ads run by Best Buy, Sears and Wal Mart. If you run you ad just twice per week for three months, you are looking at an investment in excess of $10,000!
Another potential problem with running advertising is that people have become very suspicious of what advertising is trying to tell them. We have all heard radio or television ads for products whose performance seems too good to be true. And when we go to look for them in the store, they often turn out to be very disappointing. As a result, people who buy only from the message communicated by advertising often are not very loyal customers.
Where Advertising Does Well
Despite the potentially large cost and challenge to effectively impress the sales prospect, there are situations where traditional advertising can be very useful. Good candidates for using advertising are:
- Businesses that provide a product or service people know they need, such as bread or milk
- Products or services that are needed immediately, such as chain saws after Hurricane Andrew
- New products or services that are pretty easy to understand, such as a quick oil change
- Products or services where quality is easy to measure, such as typing.
What Advertising Can Do
To realistically invest in advertising you should be clear on what objectives it is good at achieving and what it is not so good at delivering. Among the positive results that advertising can produce are:
- Establish and maintain a distinct business identity
- Make your business look larger than it is
- Remind customers of the benefits of buying from you
- Encourage customers to buy more of what you sell
- Attract attention from new prospects
What Advertising Doesn’t Do Well
Waiting to place your first newspaper or radio ads until you are desperate can cannot usually be expected to deliver:
- Create overnight customers
- Solve cash flow problems
- Cause an immediate jump in sales
- Make up for poor customer service
Convince people to buy useless or unwanted products or services As we mentioned in an earlier column, before you pursue any promotion you must double-check that you have achieved the basics for marketing success:
- A definite solution to a need or problem.
- A product or service that is top quality in all aspects.
- Pricing that is fair, easily understood and profitable.
- A reliable production and delivery system.
- Customer service that coverts buyers into fans.
It is doubly important that you make sure you have built a solid foundation for selling your product or service before you conunit to advertising. The stakes are simply much higher than with most other forms of promotion.
The Two Keys to Advertising Success
It is estimated that the average American sees more than 30,000 ads per year. On average, only one of nine well-designed ads is ever seen by those it was intended. And it usually takes three repetitions of an ad before it is remembered.
- The first key to advertising success is: Don’t do it unless you are willing to make a longterm (one year at least) commitment. Even though you may become tired of seeing your ad month after month, don’t be tempted to change a well-written ad because remember, it is new to some readers each month.
- The second key to advertising success is to take your time in preparing the ad. With the growing sophistication of desktop publishing today, it is relatively inexpensive to design and layout an eye-catching ad (usually less than $500.00). The key to producing an effective ad is to start with your objectives. Use the Advertising Objectives Worksheet below to detail what you want the ads to achieve.
Advertising Objectives: Create Your Own Worksheet
- Describe your product or service _______________________________________________
- Describe your target market __________________________________________________
- Describe your main competition _______________________________________________
- How is it better and different from your competition? _________________________________
- What is the one idea you want the reader to get from you ad? ____________________________
- What action do you want the reader to take after reading you ad? _________________________
- Describe your product’s main benefit. ____________________________________________
Designing an Advertising Campaign
You can use the following outline to proceed from the Advertising Objectives Worksheet to putting into action a winning advertising strategy. Proceed one step at a time to answer the following questions:
- What is the purpose of my advertising? Try to relate the advertising goals to your company’s sales goal for the next year. Be as specific as you can in indicating what percentage or dollar increase in sales you would expect.
- What can I afford to invest? It is common to set an advertising budget based on a percentage of the sales you wish to achieve, such as 5% of sales for the next year.
- What features and benefits do I want to communicate? Most of us can come up with product features pretty easily. But do you really understand the benefits to the customer in buying from you?
- Who is mv audience? Live surveys, focus groups and library research should be used to focus as tightly on your desired marketplace as possible.
- Who is mv competition? Acknowledge what your competition does well and try to do it a little bit better. Don’t be hesitant to borrow from what works for others. Remember your prospects will determine the value you offer by comparing you with other suppliers of similar products.
- Do I need more information? Do you really understand your industry and how newcomers become known? Do you have a realistic view of the minimum marketing investment to make any impact,
- Study media choices, request information and compare. Use the SRDS guides to consumer and business magazines to learn the names of places to advertise. Contact the publishers and ask for their media kits, which include their advertising rates. Go to the library and read over any magazine or newspaper that might be read by your prospects. What do ads in these media look like? Think carefully about how many readers you will pay for versus how many readers want what you have to offer.
Resources in Your Neighborhood
Even though placing advertising can be quite expensive, help in producing a good ad can be very affordable if you look around your local area. Downsizing in recent years by advertising and public relations agencies has resulted in some very talented writers and designers starting their own home businesses helping other small businesses create winning ads. You can often find them thorough classified ads in local shopper papers or on bulletin boards at grocery stores or office supply stores.
Local newspapers also employ ad layout people who might be able to help you design an eye-catching ad. Be aware however, that these individuals are paid to lay out a lot of ads each day, so their time with your ad will be limited.
Your local quick printer can be very helpful in teaching you about how to use color and paper to make ads pop out. Just drop in, introduce yourself and tell them what you would like to achieve.
In this column we encourage you to be as self-reliant as possible. Designing ads is one area that most of us do well to hire outside talent. There is a definite knack to fitting words in a small space and incorporating graphics effectively. And writing the copy is an art in itself. Copywriters are freelance business people who work with words to create the most compelling mental picture for the reader. Good copywriters can be hired for $40 – $50 per hour.
Once you have a sketch of the ad you think you want to run and have completed the first draft of the copy, show it around to other small business people. Ask them. Make corrections for you go to what is called “camera-ready” art, which today may simply be a piece of laser-printed paper with black ink.