The Dynamic Manager’s Guide To Advertising:
How to grow your business with ads that work
by Dave Donelson
DSDA Publishing, Smashwords Edition
Copyright 2010 Dave Donelson
Discover other titles by Dave Donelson at Smashwords.com
Smashwords Edition, License Notes
This ebook is licensed for your personal enjoyment only. This ebook may not be re-sold or given away to other people. If you would like to share this book with another person, please purchase an additional copy for each person. If you’re reading this book and did not purchase it, or it was not purchased for your use only, then please return to Smashwords.com and purchase your own copy. Thank you for respecting the hard work of this author.
Chapter 1 The Advertising Conundrum
If you stop promoting, your customer base melts away like an ice cream cone on a July afternoon.
Chapter 2 Advertising Goals, Part One: Your Image
The goal isn't to enhance the image--it's ultimately to affect the bottom line.
Chapter 3 Advertising Goals, Part Two: Your Sales
Advertising is about sales, sales, and more sales.
Chapter 4 Advertising Goals, Part Three: Positioning Your Business
Once the consumer puts an advertiser in a position in their mind, it generally stays there.
The best approach is to be as specific as possible in the claims presented.
Chapter 6 Five Rules For Effective Advertising
You must know what matters to your customer before you can produce advertising that appeals to them.
There is no customer named "the market" but there are many named Bert and Bertha.
Chapter 8 Effective Advertising Is Local
Like politics, all good advertising is local.
Chapter 9 Say It Over And Over Again And Again And Again
Advertising works the way the grass grows. You can never see it, but every week you have to mow the lawn.
Chapter 10 Case Study: P.C. Richard
Even in tough times, P.C. Richard generally doesn't cut back much on advertising expense.
Chapter 11 Pay Attention To Attention
Don’t be afraid to try unconventional tactics to get attention.
Chapter 12 Advertising's Four-Letter Word
When you tell someone something they already know--or think they know--they stop listening. Just ask anyone with teenage children.
Chapter 13 Just A Little Reminder
Advertising works more like a directional arrow. It tells the customers where to go to get something once they've decided they need it.
Chapter 14 Should Price Be In The Picture?
There's generally no reason to use price advertising since few purchase decisions are made on that basis.
Chapter 15 Four Rules For Buying Advertising
You really shouldn't hide in the back when a media sales person comes into your business.
Chapter 16 Case Study: Lehman's Hardware
The Lehman family of Ohio sells butter churns and washboards--via the Internet."
My first job in advertising was as a copy writer for a radio station. It didn’t pay much, but I learned a ton. Over the years, I produced TV commercials, designed print ads, and planned many media budgets. But you never saw my TV spots on the Super Bowl or my print layouts in Vogue. My clients weren’t gigantic multinational brands like Coca-Cola or Chevrolet. Instead, I created ad campaigns for Casey Meyers Ford and Soda Boy (whose still-memorable slogan was “Oh Boy! Soda Boy!”)—advertisers in St. Joseph, Missouri, the small town where I grew up. My ads were for local businesses, not national conglomerates. In other words, they promoted businesses just like yours.
Working in local media as I did is a great way to learn a lot about all kinds of businesses. Car dealers, grocery stores, clothing retailers, and home improvement contractors all have different advertising needs. Some are looking for more store traffic, others want to expand their market area. Attracting new customers, building loyalty in the existing clientele, encouraging repeat purchases or introducing new product lines each require different tactics. There are a few principles that apply to them all, but there really is no such thing as one-size-fits-all advertising. Please keep that in mind as you consider the concepts in this book.
When you mention advertising to most people, they immediately think of the behemoths of the airwaves—companies like Procter & Gamble, McDonald’s, or Wal-Mart. But big spectacular national ad campaigns like theirs have little in common with advertising the way it’s done by small businesses—the kind of advertising you do. In most respects, advertising your business is harder.
Mostly, of course, that’s because you don’t have a gazillion-dollar advertising budget. You probably don’t have a lot of expensive research to precisely define your market or a dedicated psychometric laboratory to test your ads before they run. Your copy writer may double as your store manager most of the time. Your art director most likely spends most of her time freshening merchandise on the shelves. Your media planner? Probably the person who writes the checks—you. In other words, your advertising isn’t designed and executed by a team of Madison Avenue gurus, it’s the product of the good-hearted people who help make your business a success.
That certainly doesn’t mean it isn’t effective. Quite frankly, somebody who spends 90% of their time talking to your customers (like your store manager does) is going to have an infinitely better understanding of what they want than some clip-board-toting psychological profiler or white-coated lab technician. You don’t need a super computer to calculate your media efficiencies to the fifth decimal point when you’re trying to decide whether to promote this year’s Father’s Day Sale in the Weekly Inkspot or the TV-49 Six O’Clock News. What you probably do need, though, is a better understanding of what makes advertising effective and how to make it work better for you.
That’s where The Dynamic Manager’s Guide To Advertising comes in. This book offers you some basic rules that will help increase the return on your advertising investment. Some of them come from my experiences creating ads and watching customers react to them as I stood in my clients’ stores and offices as the campaigns ran. Others were drawn from the lessons learned by small business owners themselves, from auto repair shop owners to nursery retailers, clothing stores to insurance agents. In other words, this book isn’t about theory—it’s about the real world of small business advertising.
Much of the material in The Dynamic Manager’s Guide To Advertising comes from seminars I’ve presented around the country over the years. Some of it has appeared previously in the national business and trade publications you’ll find listed in the bibliography. The book is organized to encourage you to sample, think about, and try out different concepts over time. It’s not a narrative or a text book; there isn’t a step-by-step organization but rather a collection of useful articles that address practical problems in small business advertising. I hope you’ll find some useful guidance that fits your specific situation and discover some tactics you can use to accomplish your particular goals.
Above all, I hope you gain a few insights into how to grow your business with successful advertising.
-- Dave Donelson
The Advertising Conundrum
“If you stop promoting, your customer base melts away like an ice cream cone on a July afternoon.”
Plenty of small business owners consider advertising a total waste of money. According to them, word of mouth is the best advertising and that’s something you can’t buy. They’re right, but only partly: word of mouth is the best, but you can buy it. That’s what good advertising does—it buys word of mouth.
A good, targeted ad starts potential customers talking about you. It gives them something to think about and prompts them to bring you up in conversation with their friends and neighbors. If you don’t advertise at all, you’re really just hoping for two things. First, that you satisfy all of your customers all of the time so none of them have anything bad to say about you (remember, word of mouth cuts two ways) and second, that a whole bunch of them will spread the word on their own. That’s a lot to hope for, which is why most banks don’t accept deposits of hope.
Keep in mind, that “advertising” doesn’t have to be a million-dollar TV commercial on American Idol. A fifty-cent postcard announcing your new selection of life-enhancing widgets mailed to a targeted list of a couple hundred potential customers is advertising, too. It’s the kind of advertising that buys some word of mouth.
“We all buy ads with the hope that it’s going to get us customers,” says Bill Colton, “but there’s certainly no guarantee on that.” Like many other small business managers, Colton has personally experienced that sad fact of business life for more than 25 years as the owner of Troyer Speed & Custom in Rochester, New York. But that doesn’t mean he’s going to stop promoting his business. He says if you stop promoting, your customer base melts away like an ice cream cone on a July afternoon.
When to advertise, how much to spend on advertising, even whether to advertise at all are questions that are at best difficult to answer for businesses in the automotive performance industry (or any other). On the one hand, you like to think that your reputation for good work and fair prices will draw people into your shop. On the other, you have to realize that if they don’t hear about you in some way, that elusive new customer isn’t going to even know you exist, much less that you have a strong reputation. And when you factor in all the competition you face, advertising becomes much more imperative.
“Everybody in the industry is working on thinner margins than they did ten years ago because it’s such a more competitive business,” Colton says. In order to maintain a satisfactory level of profit on smaller margins, your sales volume has to increase. Existing customers have to be persuaded to spend more money and new customers need to be attracted to your shop. And look out for customer attrition, Colton advises: “The mail-order deal, the Internet thing, and all the above just keeps nipping away at your customer base so you have to become a little bit more aggressive.”
Linda Hietala, who owns Reliable Welding & Speed in Enfield, Connecticut, with her husband Brad, agrees that you have to keep trying to attract new customers. “The best form of advertising is word of mouth and referrals,” she says, “but you can’t totally rely on that. You need to be in different publications so people can find your name and phone number.”
Different Strategies for Different Shops
So how do these advocates of small business advertising go about it? Hietala believes in the scattergun approach, using as many different promotion vehicles as she can afford and not relying on any single medium to hit all the targets. “We try to reach everybody in every different way,” she says. Reliable advertises in Speedway Scene and regional racing papers and also does track programs and similar publications. She’s also a believer in the Internet.
“We have the website, of course, and people can request catalogs and so forth. That helps us in other than our local area.” But, she adds, the web works in mysterious ways: “A lot of times, it helps, too with some of the local people. They can go on there and check to see if we’re carrying a certain product line or different things like that.” Hietala’s experience with the Internet jives with the results of a study done by Valentine Radford Advertising in Kansas City, which showed that about two-thirds of the time a shopper will research a product online and then buy it in the store.
Reliable has been on the web for many years, and so has Troyer, which Colton says was one of the first speed shops in the area to go on-line. He believes there’s a great future in it, but points out one of the Internet’s biggest problems: the time, effort, and money required to do a good job with it. “We’ve been undergoing a long process building a website,” he says. “We were one of the first in our area to have one, but we just never put the dedication and the expense into making it a good site. We try to work on that, but it’s a matter of time and money.”
Ah, there’s the rub: Time and Money. Colton observes that all advertising requires generous applications of both. He’d particularly like to do more direct mail advertising, which he says has been successful for him in the past, but, “When you start coming up with ads and things like that, you almost need a full-time employee dedicated to making flyers and coming up with programs. That becomes costly in itself. The cost of mailing is expensive, then the cost of the thought process of what to do and how to do it and then making it, it just becomes very costly.”
How about other advertising media? Neither Hietala nor Colton have had much luck with broadcast media like radio, television, or cable, probably because, as Colton says, “You’d be reaching maybe ten people out of five thousand that might be prospective customers. It’s just such a cost to reach those ten people.”
Results, Please
Hietala adds, “Some things you stop doing after you evaluate what you get from them versus what it costs to do it.” She’s believes in constantly assessing how well her advertising performs: “Whenever we can, we try to ask new people how they heard about us. A lot of times, when they call, they’ll just mention where they saw us.” That’s not a foolproof method, of course, since many (if not most) customers don’t really know how they heard about a particular business because they’re bombarded by so many advertising messages every day. If they don’t know, they’re also inclined to say the first thing that pops into their head rather than admit they don’t know, a phenomenon which can badly skew your results. That’s why Hietala gives each promotional outlet plenty of time to prove itself.
Like many speed shops, Reliable and Troyer are heavy supporters of the local race scene. “We have a forty-foot parts trailer that we bring to one of the local race tracks,” Hietala explains. “That’s a good way for us because the track (Stafford Speedway) has, in addition to their weekly racing, special events through the year where they’re bringing in other touring series like the featherweight modifieds and the Busch North. This last year, they had an open wheel show with the midgets, sprint cars, and super-modifieds. So being visible there with a trailer, we’re reaching a lot of people.” They also sponsor the rookie program at the track and provide contingency awards for special events like a 100-lap race. Troyer sponsors a night at Lancaster Speedway, a big asphalt track in the area and gets involved with small promotions with other tracks as well as running his own car.
While these advertising opportunities are specific to speed shops and other automotive-related businesses, many similar ones exist for small business owners serving other markets. Many pet shops support their local animal shelter, for example, and clothing retailers are often big sponsors of local fashion shows. With a little imagination, business-to-business firms can use the technique, too, like when accounting or law firms offer free seminars to local chambers of commerce or provide speakers for service clubs.
Colton says he firmly believes that one of the keys to success in advertising is consistency: “When you see repetitive ads, people start getting used to it and it registers. When they think they need a particular aluminum rod end, they’ll think of one brand that they’ve seen repeatedly in a magazine. That’s when you start to see payoff.”
Hietala’s scattergun strategy works much the same way. “If you can get a little bit from everything, it all helps.”
Advertising Goals, Part One – Your Image
“The goal isn’t to enhance the image—it’s ultimately to affect the bottom line.”
Let’s talk about your advertising. Why it works and why it doesn’t work a lot of the time. We’re going to start by talking about the three basic advertising functions, the goals that advertising can accomplish for the advertiser. These are image goals, sales goals, and positioning goals. These are not mutually exclusive and certainly many ad messages accomplish or attempt to accomplish more than one. But, for clarity of presentation, we’re going to discuss them one at a time.
Image advertising goals are those sort of warm, fuzzy, amorphous ambitions that many advertisers have. They want people to feel good about their business or good about their company.
We hear many times that one medium or another—television or magazines, for example—are the great image building media. For many years, the Television Bureau or Advertising, the trade association responsible for promoting commercial use of television, went around telling advertisers to use TV to build their business’ image while using the newspaper to generate specific price/item sales.
And there is no question that television is the great image medium. Beautiful sunsets, puppies and little girls frolicking through a meadow of wildflowers can’t be presented very effectively in a black and white newspaper ad. But keep in mind that those kind of images don’t sell a heck of a lot of merchandise, so image advertising needs to be used with great care.
There are some businesses that have a legitimate need for image advertising. They have a real need to put out the message that “Hey, we’re great people here at Company X!”
They key to doing this kind of advertising is to start by answering the question, who are we trying to influence? Who is the intended recipient of our message?
Defining the audience
Legitimate image advertisers almost always have a very specific and narrow intended audience. They’re trying to reach those individuals who have a legitimate concern with the type of company they’re doing business with. These will tend to be companies like financial institutions, public utilities, health care companies, certain manufacturers or others who have very specific image problems.
What these companies are trying to do is influence the attitudes of the people in the well-defined community they are trying to reach (with community meaning simply a discrete group of individuals, not a geographic area). The people they are trying to reach will have some influence on the success or failure—the economic health—of the advertiser’s business.
Let’s look at an example: a manufacturing company with a plant located on the river in your town. The company manufactures widgets and as part of their manufacturing process they paint those widgets. An unfortunate by-product of the painting step is that they use a lot of solvents, which, in the days before the EPA, were dumped in the river.
The current owners of the company and their management and employees didn’t do this—it was a previous generation. But the bad will created by this action exists today. And that bad will interferes with the company’s ability to hire people, to sell the widgets, and to raise money for operations. Maybe the bad will gives the town a bad name, which in turn drives away potential contributors to the tax base, which results in the widget company’s taxes being higher than necessary. In short, a bad image problem can affect the company’s bottom line.
And that’s at the root of addressing an image need through advertising. The goal isn’t to enhance the image—it’s ultimately to affect the bottom line. The bottom line can mean either profit and loss or it can mean the value of the company as a possible acquisition candidate or on the stock market. The image itself has no value of its own. You must make sure that connection exists—that the image advertising has a direct connection to the company’s economic value.
And you can’t make that connection unless you know whose mind you’re trying to reach with your image advertising. Very seldom should the intended target be the community at large. It’s almost always a much narrower focus. Let’s look at some of the narrower communities where image needs might exist.
The company’s employees are a frequent target. If the employees feel better about their company, they’re less inclined to do nasty things like go on strike, more apt to work harder, and less likely to leave for greener pastures, among other things. That’s why you’ll often see companies advertising a year or so before their union contract negotiations begin. They want to soften up the opposition. That’s why you see those seemingly purposeless ads that say, “Welcome to the ABC Widget Company. We’re a wonderful place to work. We’re so proud of our many great employees who contribute so much to our company and the town in the which we all live.” Didn’t you every wonder why a company would spend money on a campaign like that? Wonder what they were trying to sell?
The company doesn’t care what you, the casual viewer, thinks about them or their ads. What they care about are the 5,000 people who work in their plant who will sitting across from management at the negotiating table in a year. They can’t very effectively address them directly with the message about company love, but they can obliquely get the message across through such image ads on TV.
Good citizenship
Sometimes advertisers spend to influence even smaller groups, like government regulators. If you’re in one of many kinds of regulated businesses, like public utilities, insurance , or telecommunications, your ability to make a profit is highly dependent on the attitudes toward you held by the public service commission or insurance commission or other regulatory body that governs your business. That group of five, ten, or fifteen citizens holds your fate in the palm of their hands. Among other things, you may have to go to them every year or so and convince them that your company is a good citizen and deserves to make a larger profit than you did the year before.
The commission studies your books and compares your operation with others and considers all sorts of factors before they make a decision about the level of your profitability. One of the key factors they consider are the number of complaints received about your company’s operations from the community! So if your company’s advertising can influence the number of complaints filed by your customers, you come out ahead.
One of my favorite examples of this type of campaign is the spring staple presented by the local light and power company. Every March, you’ll see a few ads warning kids to keep their kites away from the high tension lines. These aren’t to keep kids from being electrocuted—the power company has liability insurance to protect itself—but rather to convince the community that it cares about all those rosy-cheeked citizens of tomorrow. It makes a great story to present to the public service commission when they can show the amount of stockholder money spent on public service ads instead of dividends.
The personal touch
There’s another audience that image advertisers sometimes try to influence, but it’s one that they don’t talk about much. In fact, they’re usually not even conscious of their attempt to reach them. Many times, image ads are directed at the advertiser’s friends and acquaintances! If you’re the only bank in town that doesn’t advertise on TV, you may feel somewhat self-conscious at the country club when your peers and competitors are talking about their TV campaigns. There’s some keep-up-with-the-Jones’ in business life, too.