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Getting The Most For Your Advertising Dollar
By Robert Evans Wilson, Jr.
© 1993, Robert Evans Wilson, Jr.

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NOTE FROM THE AUTHOR: The other day while going through some old files, I came across this article I wrote in April 1993. As I re-read it for the first time in decades, I thought that the information offered - even though it is 24 years old - is still basically sound. And, I decided to post it to my website because it's a fun reminder of what Pre-Internet/Pre-Smart Phone Advertising was all about. Rob Wilson, November 7, 2017

You want to increase your business, so you've decided to advertise, but you haven't a clue about getting started. What you do have is a million questions: What should I advertise? Where should I advertise? Should I hire an agency? How can I tell if it's working? And the biggie: What's it going to cost me?

Maybe you're already advertising, but you want to do it better. You want to make sure you get your message across, while every buck you invest generates the greatest possible return.

What you want is the most productive advertising at the lowest possible cost. We all know that what is: word-of-mouth advertising - not only is it the most effective - it's free! Unfortunately, to get this type of advertising you have to earn it from satisfied customers. But that still means you have to get those first customers in the door. And, the best way to do that (you guessed it) is advertise.

The promise of advertising is that it increases business by attracting new customers while maintaining existing ones. As an effective marketing communications tool, it has stood the test of time as the most cost efficient way to move products or services. However, to gain these ends careful planning is required.

Believe it or not, advertising can actually reduce your selling costs. Good news, huh? Well, your properly targeted ad will reach your potential customers inexpensively. Plus, it will answer in advance those hard-edged questions your salesman would otherwise face while imperiling his foot in the crack of your prospect's door: "Who are you and why should I buy from you?"

Getting the most for your advertising dollar begins with understanding what role advertising plays in your business. In a nutshell, advertising boils down to determining who wants your product or service, what will motivate them to buy and where they are most likely to see your message. The goal of any advertising campaign is simple: to generate leads and prospects. To ensure the best results, you or your marketing professional should:

1. Set measurable objectives.
2. Define your target audience.
3. Select the media most likely to reach them.
4. Survey customers and prospects to decide what your offer should be.
5. Execute the program.
6. Measure the results.

The best kind of advertising is free publicity. But, to get your share, you have to include a public relations campaign as an integral part of your complete marketing program. Generating publicity means, bringing any commercially significant news about your company to the attention of the media. Press coverage of your product or service is better than any chest-beating ad you'll ever pay money for, because when commercial news is published editorially, it receives the unbiased attention of the reader. Publicity is probably the most efficient yet under-utilized form of marketing communications available to business today.

Setting Your Objectives

The first step then is deciding what you want to accomplish through advertising. What are your goals? If yours is a new business, then your goal will be to let the public know who you are and what you do. Advertising will help you create a positive image in the minds of your target audience as well as sell the benefits of your product or services. If yours is an established business then your goal is increasing market share, or you may need to change an unfavorable image. For example, if you learn that people think you are more expensive than you actually are then you have an image problem that needs to be rectified.

Your advertising goals should address both the long and the short range. A long range goal may be to establish a general awareness of your business, such as, explaining the facts about the products and services you offer or simply where you are located. The idea is to reach a lot of people. Even if someone is not in the market for what you offer, you are still beginning the word-of-mouth process. Do you have a complicated product or service? Running "Ask the Pro" ads that answer questions will establish your business as the "expert" in the minds of the public.

Established well known companies with a good reputation will want to run ads that keep their name visible. These ads simply remind people that the company is still around, doing an outstanding job and satisfying customers.

Short range goals include ads that introduce new products or services or promote special events or sales. One rule about these types of ads is that the image must mirror that of your long range ads, if you don't, your customer may not recognize them as yours.

Another goal of advertising may be to solve business problems such as an inconvenient location. Your ad offers the customer benefits that make it worth a long drive or hunting for a parking place. If you don't advertise, customers tend to assume that all similar businesses have no real or important differences that make one preferable to the other. Remember, consumers don't have time to try out every business in town - your ads must do this for them.

You will get the most out of your advertising dollar if you set concrete measurable goals. For example you may want your advertising program to generate 100 new leads per month.

Your Target Audience

The next step is determining who your target audience is and where they are. Who is most likely to buy your product or service? This is your primary target audience. Your business will have natural customers; these are the people who already want what you have to offer. This group is the foundation of your customer base and comprises who you will advertise to when you are first starting out, and who you will continue to advertise to through your long range goals. Your ads should feature the benefits they are interested in, and should be placed in media they are most likely to see and hear.

In order to determine who this group is, try to make some generalizations about the customers you do business with the most. Consider their age, income bracket and education. Are they bargain hunters or spend thrifts? What you are discerning is the demographic and psychographic information about your typical customer. Demographics are vital statistics that describe your customer according to age, sex, education, income, family size, religion, and ethnicity.

To refine the identity of your target audience use psychographics which help you distinguish whether your customers are leaders, followers, status seekers, individualists or traditionalists. These are lifestyle differences, for example: leaders take chances and are interested in that which is new; followers prefer the popular and accepted things; individualists want to be unique; and traditionalists like the classics. Psychographics will fine tune your demographics, and will allow you to adjust your message to the hopes, fears, desires and perceptions of your audience. You should ask: What is someone likely to get out of doing business with me?

You will get the most out of your advertising dollar when you target your advertising to your most likely customers. Targeting enables you to narrow down the field of media to choose and when to buy space and time. Targeting also makes your message more effective. If you know who you're talking to, then you will know what to say to them. In other words, don't try to sell Geritol on MTV.

Take a complete inventory of your customers and determine if your business offers features that are attractive to other groups. These are your secondary target audiences to whom you may also wish to advertise.

Some businesses have seasonal target audiences. This explains why you see so many florist and greeting card ads just before Valentine's Day and Mother's Day. If your business is affected by seasonal surges then you need to allocate a greater portion of your budget to advertising during these periods.

Preparing the Advertising Message

Once you have determined who your audience is, you can begin work on your message. You should begin by asking: What advantage does my customer have in buying from me instead of my competition? What benefits do I offer that are exclusive to me? What problems can I solve better than anyone else? If there is no competitive advantage, then what is it that I want them to know about me?

Be careful not to confuse benefits with features. Benefits are what your customer derives from using your product or service. Features are what makes the benefit possible.

If your product or service has strong competitive advantages you should advertise this fact by comparing them objectively to your competition's products and services. Dramatize the results of your comparison, then tell your audience what to do about it.

You should supply as much marketing information with your copywriter as possible - don't expect him to be your research department. However, if you are using an agency, media employee, or freelance copywriter don't give out proprietary information - your agent today may be your competitor's agent tomorrow.

Once you have ascertained what your message is, your advertising copy must communicate the point quickly and clearly. The three basic components of all advertisements, in order, are: Get Attention, Prove the Benefit, then Compel Action.

You can save money while developing ads by reviewing them in their early stages as rough layouts with copy outlines. Some of the best ad concepts ever created started out as drawings on restaurant napkins. Reserve expensive finished layouts and storyboards for the CEOs and company presidents.

If you find an advertising approach that works and provides the results you are seeking, then stick with it. Even if you get tired of running the same ad, remember that new people are coming into the market every day.

The best approach, especially for your long term goals, is to plan an advertising program. A planned campaign is more effective and cost efficient than placing hit-or-miss ads. The general idea is: it's better to act than to react.

This means that your advertising should be coordinated to run at the same time as any sales promotion activities. It is always less expensive to design a complete marketing program that includes sales promotions and advertising than it is do each separately.

To maintain a consistent and effective program strategy, you should not run different messages at the same time - even in different media. Doing so will confuse your prospects and destroy credibility. It also wastes money to have different messages appearing in print, TV and radio when all are directed to the same audience. An example of how you can get the most out of your advertising dollar while maintaining consistency in your message is to adapt a print ad, a radio ad, and a direct mail kit from your television commercial. You can continue this concept of "repeating" even further and reinforce your message even more by utilizing print ad re-prints to develop other advertising such as brochures, yellow page ads, bill boards, direct mail inserts, packaging, trade show exhibits, sales presentation materials, posters and point-of-purchase promotions. Not only will you save money, but you will develop a more memorable message!

Pre-testing is an important aspect in ensuring that you will get the most out of your advertising dollar. Pre-testing allows you to eliminate a bad ad or campaign before it wastes a lot of your money.

There are companies that provide sophisticated pre-testing for a corresponding sophisticated fee, but there are methods of pre-testing you can conduct on your own for free. Consider forming an advisory board that consists of your major customers, suppliers and investors. Most people will be honored that you have asked them to serve and will do so without compensation (except for expenses) for a reasonable term such as a year. Another way to pretest is to consult your media professionals. Media people know their audiences, what your competition is doing, and what approaches have succeeded or failed in the past. CAUTION: be careful what you tell them, especially before you have decided to place with them, because the information you give them can be used in their media selling efforts elsewhere. Focus groups are also a good method for pretesting but you will have to treat the group to a luncheon, as well as hire a moderator to conduct the proceedings, and someone to videotape their reactions.

While you are creating your message there are ways you can reduce your production costs. The first rule is to strive for simplicity. You should also do as much as possible yourself; use outside resources only as necessary. If you do outsource work, you should get cost estimates in writing before making any commitments. Examples of cost saving techniques include using photography from the company files, or stock photos instead of hiring a photographer. Don't hire models - use your own "real" people instead; your employees and customers will be more empathetic to your product or service than an impersonal model. Use camera-ready artwork and mechanicals wherever possible.

Planning an Advertising Budget

When it comes to creating your advertising budget the important factor is not what you spend but - how you spend it. The first rule of advertising expense is that it will vary in direct proportion to the size of your target audience. It goes like this: the broader your reach the greater your cost.

The best thing about a planned budget is it will allow you to take advantage of the frequency and bulk space discounts offered by many media, and you get more advertising for your dollar.

The big question of course is: How do you decide how much to spend? The easiest and most common method is to base it on a percentage of gross sales from the past year or average from past few years. A new business will have to base it on projections. The percentage can be determined from industry averages which you may obtain from trade journals, the Small Business Administration, the Census bureau, or the IRS. Another method is to compare the amount of advertising by your competitors, then budget an equal or preferably a greater amount.

Another way to get more out of your ad dollars is with co-op advertising. This is advertising that is financed jointly by the manufacturer or distributor and the company selling its product or service. Most of these businesses will expect you to place a minimum order before they furnish co-op funds, and they will expect the ad to primarily feature their product.

Planning An Advertising Campaign Calendar

To get the most out of your advertising dollar, you need to discover the best time to reach your target audience. You can do this by creating a campaign calendar. First mark each month of the year according to whether business is up or down. Then calculate the percentage of sales by month. Follow this by breaking down your total advertising budget by month according to sales. The theory is that there are natural months for certain businesses, that is, when people are more likely to be in the market for your product or service. These are the months you need to advertise more - when your name needs to more visible.

After allocating your budget by month, go back and note any holidays, events or sales days that require additional advertising and increase your monthly figure accordingly, also add in co-op advertising times as well.

Selecting The Best Media Mix For Reaching Your Target Audience

Once you have set your objectives, defined your audience, and prepared your budget you are ready to select the mix of media that will most effectively reach your target audience. The best advertising programs utilize more than one medium. Of the traditional types of media, whether print, radio, television or direct mail each will have its own characteristics.

Print advertising can be very selective in reach. When you are considering publications the editorial environment becomes the most important criterion for evaluation. There is a publication for nearly every market, and your ad will be positioned in an environment that is compatible with the reader's interests.

Several types of newspapers are usually available to most advertisers including: large circulation dailies, local weeklies, and specialty newspapers targeted at specific audiences. Even within a particular paper certain sections (Sports, Fashion, Politics, Entertainment, etc.) appeal to very definite segments of the population.

One of the advantages of print is staying power a reader will pick up a newspaper more than once and a magazine several times, you may also get extra exposure from pass along readership.

The second most important consideration in selecting a publication is cost per thousand (CPM). This is calculated by comparing the cost of reaching 1000 subscribers with the cost of a given advertisement based on total circulation. It will give you an indication of the most efficient publications. A better indicator is cost per effective thousand (CPEM) which is a more precise method of comparing costs. This way you calculate only that percentage of circulation which meets the exact demographic profile of your target audience. These costs will calculate higher than CPM but they will be more valid. Also find out if the publication has regional and demographic editions - it will cost less than full-run circulation and you can customize your messages for greater impact and influence.

A word of caution: don't let subjective criterion affect your judgment in selecting a publication. Don't select or reject a publication based on whether or not you like it. Remember you're the one selling your products or services - not the one buying them.

Measure the effectiveness of your print ad by offering literature to those who clip, fill out, and mail in a coupon for more information. These responses tend to generate better qualified leads than easier to use "800" numbers and pre-paid response cards..

Ask publications if you can purchase circulation break-outs, these are the names of those readers who meet your demographic target and provide an excellent list for sending your direct mail pieces.

Direct mail is the most selective, efficient, cost-effective, and measurable form of advertising. Today, there are list companies that provide mailing lists that will target your audience with remarkable demographic and psychographic accuracy. The three most important factors of any direct mail campaign, in order, are: the list, the offer, and the creative message. Finally, make sure that your direct mail kit always contains a response device.

Radio is a relatively inexpensive and creative medium in which you can achieve a range of advertising effects. Radio is in essence a mini-theater. You can target your message accurately because each station has a format which attracts a specific demographic and psychographic audience.

Television is considered the ultimate media because of its show-and-tell capabilities and large audiences. Those large audiences come with matching large price tags, plus the additional expense of production costs. TV has greater reach than radio and because viewers have favorite programs, and it is easy to reach the same viewers consistently. Television is efficient because the audience is targeted by program. Another advantage of TV is psychological: when you advertise on TV, people assume you are doing well.

There are also every day forms of advertising media which you should consider as part of your total advertising program. Beginning with your company name - it should reflect what type of business you are. Your logo should accomplish this and it should be memorable. Your logo should be on your signs, bills and receipts, shopping bags, buildings, and delivery trucks. You might consider establishing a color or group of colors that people always associate with your company (think McDonald's, John Deere, Target, Home Depot, UPS, etc.).

Advertising is a lot of little things other than paid media. It's the look of your lobby, the way you answer your telephone, and the way your staff greets visitors. Often your customer's first impression is based on the layout of your store or office. Your business cards, your letterhead, and your invoices all add to your overall advertising campaign. Many top advertising professionals suggest that every invoice should carry a selling piece like you find in your bills from your credit card and utility companies. Never pass up such an inexpensive advertising opportunity - put a flyer in every envelope!

You should always be on the lookout for alternative forms of advertising media such as: T-shirts, ads on bulletin boards, utility pole posters (if allowed), helium balloons, sandwich boards, hot air balloons, sky writing, and specialty items with your name and logo (pens, key chains, coffee cups, magnets, etc.), these are all reminder media which keep your name in front of the public. Other alternatives include asking a non-competitive business to put your ads in their bags, or in the envelopes with their bills, or on their counter tops. Advertise in symphony or sports programs or in souvenir booklets for cultural events. Sponsor a bowling or little league team. It may be a small team but you are advertising to the spectators and the team members will probably try to send you business out of gratitude. Be creative - many of these methods are inexpensive.

Getting The Most For Your Money

One of the proven ways to get the most out of your advertising dollar is to keep advertising. Plan properly, set realistic goals and budgets, get the right combination of media and message, then stay with it. A comprehensive survey conducted by the John Morrel Company, Inc. involving 23 products and 129 brands, and 40,000 interviews held at 17,000 buying locations concluded: "Companies that sustain their advertising programs, particularly during inflation or recession periods, have better sales and profits than those who don't." Many progressive companies will actually increase their advertising rather than cut their advertising budget during sales slumps and recessions.

Remember, the in-and-out pattern of advertising wastes money and minimizes return and can even decrease your credibility. The quality of your ads as well as the consistency in frequency in which you run them affects the public's perception of your reputation. When you stop advertising, it can tip off your competitors when to increase their advertising. Finally, when you stop advertising, present prospects forget you and future prospects who are entering the market every day will not know about you at all. Getting the most for your advertising dollar means advertising consistently as well as effectively.

Robert Wilson is an award-winning advertising consultant and speaker, contact him at www.jumpstartyourmeeting.com.

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