Category strategies

One step at a time

We’re about a decade into the 21st Century, so most of you now realize the importance of having some sort of web presence. While there are people who will do a web site for you for $300 or $400, these sites are minimal and as the designer can only afford to put a few hours into creating the site, they will not serve the needs of most businesses.

A web site doesn’t have to be expensive, though. There is nothing that says you can’t make a small site and improve and expand it later.

At the moment, I’m working on a web site for one of my clients, Cold Stone Logging. We just finished up a logo and new business cards for them, which you may remember seeing their logo here. We are currently ironing out the final details for their letterhead as we simultaneously begin gathering information for their new website. While we were working on business cards and letterhead, we didn’t let their web site sit stagnant. Instead of the usual “under construction” graphic, a custom splash page was made that let people know that the client had a legitimate web presence, where they were located, and how to get in touch with them.

Here’s the minimalist web page in its current form:

You can see how it looks on the actual web site here, at least until the new web site is completed. The email address is an actual link, so although the site is minimal, it still has some functionality to allow potential clients to quickly and easily contact the company.

If your business does not have a web site but you are not ready to invest a couple of thousand dollars into developing one, a single on-line page might serve you well until you have the time and resources to put together a more in-depth web site. The important thing is to be in a place where potential customers can find you. The web is slowly but surely taking the place of the yellow pages, so you’d better be there. Besides, not only is a web site more effective in terms of the amount of information you can give, it is by far less expensive than the phone book.


Here’s a treat (but you’d better act quick)

A couple of weeks ago, I asked everyone if their advertising was ready for the fall. Time flies, and it goes by mercilessly. For my regular readers, I’m offering one free hour of consulting. However, I’m limiting it to only ten people. Sorry, but that’s all I can commit to.

The first ten people to email me via the contact page get the goods. Just put “free consulting” in the subject line and please include your phone number in the message. I’ll reply to your email and we’ll set up a time to talk over the phone.

What will you get? A chance to bounce some of your ideas off an ad guy, get some feed-back on your advertising strategy, talk about how to make you message strike a chord, whatever you want within that one hour. And if we hit it off, you might find a strategic partner for your advertising. And no, I’m not planning on trying to up-sell you some other services. I promise.


Some things never change

I’ve heard it said that the old forms of advertising — TV, newspaper, radio — are dead. They supposedly don’t work in today’s modern era of relationship-based commerce. Of course, I read that on a web-site or blog that runs ads. Hmm.

The truth is that all commerce is relationship-based, and always has been. You do business with those you know or at least know about. Advertising is simply an invitation to engage in commerce. It’s an invitation to get to know the customer within the context of doing business together.

Some businesses recognize this and it shows in their advertising. Others see advertising as a form of manipulation to extract something they want from someone else. That comes across as well, and it usually isn’t confined to their advertising or marketing.

How do you view your customers?


Are you ready?

This is the first week of August, and this week is nearly over. By the end of this month, school will have started in most places. That’s only about three weeks from now. Right on the heels of school starting is the Labor Day weekend. Yep, September is upon us. Then in quick succession is Halloween, Thanksgiving, and Christmas. For almost everybody, things really pick up in the fall.

If you haven’t started planning your promotions for the fall, you’d better start now. Do you know your message? It had better not be “we’re having a sale” because everyone will be having a sale. Have you thought about where you’ll proclaim your message? You’ve only got three weeks left of summer. If you don’t start planning now, then you’ll be stuck doing whatever can be done at a moments notice, and you’ll probably be disappointed with the results.


A tempting offer

A lot of small businesses have access to co-op advertising. If you sell any national brands, then you know what I’m talking about. Many of these brands have ads ready for use. All you have to do is put your logo, or your store name if you haven’t got a logo, into the space provided, and the manufacturer will pay a good portion of the cost to run the ad. Sounds great, doesn’t it?

Not so fast, though. There’s a catch. You see, if you take a look at that ad, you’ll find that it isn’t an advertisement for your store or business. It’s an advertisement for whatever product or brand you are co-operating with in your advertising. Typically, you get a slender portion of the bottom of the ad or the last five-seconds of the TV spot. The rest of the time or space is devoted solely to them. You get only a sliver.

As a small business owner, there are two questions you need to ask yourself when it comes to co-op advertising:

1. What am I getting for my money?

2. How much do I really benefit from this?

Let’s look at each of these questions, and see if co-op is really as good of a deal as you think.

What am I getting for my money?

When I first started out, I made a lot of TV spots. One of the things you run into with co-op ads is the taggable spot. For those who have no experience or knowledge of co-op advertising but are reading anyway, here’s a brief description: a taggable spot is usually a 30-second TV spot that has the last 5-seconds or so blank so you can add your store’s location and contact information. Sometimes you’ll here a narrator say, “Available at these fine locations” or something like that, but, thankfully, not always.

Anyway, often a furniture or jewelry store or perhaps an A/C & heating company will run one of these taggable ads. They reason they do is the same reason you might be tempted to do it: the manufacturer will pay for half of the airtime.

Let’s do the math.

In a 30-second TV spot, the manufacturer gets 25 seconds, you get 5 seconds. You get 1/6 of the airtime, the manufacturer gets 5/6 of it. And you get to pay for half of that airtime. Some deal, huh?

It works the same for a radio spot or a newspaper ad, only with a newspaper we’re talking about physical space instead of time.

Now if your manufacturer is paying for most or all of the airtime, then you might reconsider, but only after you’ve answered the second question.

How much do I really benefit from this?

While there are notable exceptions like Rolex, most manufacturers don’t give their partners an exclusive sales agreement. La-Z-Boy recliners can be found in a lot of furniture stores, even in the same area. The manufacturer will make money regardless of where their product is bought. Getting their name out there benefits them even if you never make a single sale.

You see, any ad your manufacturer runs also benefits any of your competitors that carries that same brand. Yeah, because you’re paying for it, you get your name attached to the ad, albeit ever so briefly. But what is more likely to be remembered about the ad, the vast majority of it concerning the manufacturer, or the sliver at the end about you? Who benefits the most?

If you have an exclusive arrangement, co-op advertising can help stretch your ad budget. But the bottom line is this: co-op does nothing to bolster your brand or identity in your marketplace. Even if you have that exclusive arrangement.

An apple for your thoughts

Learn a lesson from the big boys. Home Depot and Lowe’s both carry famous national brands, some of which are exclusively found only in one store or the other. Do they spend a lot of time talking about the brands they carry in their advertising, or do they concentrate on what makes them unique from their competitor?

Don’t think that you can’t do the same because you don’t have the advertising budget of Home Depot or Lowe’s. The money you would spend on a co-op advertising campaign could be spent on a campaign that would exclusively promote your company’s unique way of doing business. It’s simply a decision about how to best use your ad budget.

Don’t fall for co-op. It costs more than you think.


Steady as she goes

What you say in your advertising really matters. Yes, it really does. Just as you listen to what people say and make an assessment of what kind of person they are, your customers make an assessment of what kind of company you run based on what you say to them in your advertising.

You’ve probably read somewhere that your offer is of utmost importance in your advertising. But if you look through this site, you won’t find your advertising offer mentioned much, and it certainly isn’t one of the Three Pillars of Advertising. Yet you will hear, mostly from direct marketing people, that your offer will make or break your advertising. They say, “Make a great offer and people will beat a path to your door.”

Hey, they’re right, at least in the short-term. Offer a huge discount, and you will get a response. Give something away for free, and people will show up.

But if you do that often and without reason, what will your customers think? I can tell you what I think. I think that if I wait long enough, you’ll have a sale and I’ll get it at a discount. Why buy it now when I can get it for 50% off later? I bet that’s what your customers think, too, and that’s the best case scenario. Worst case is that they think you have an outrageously high mark-up because you can afford deep discounts and freebies.

Now I’m not saying that you should never have a sale or discount your product, but you should only do so for a good reason. If your prices are too high, lower them. If you need more space in your store, then have an inventory clearance. But be careful that you don’t lower the value of what you sell by continually discounting it.

It’s tempting to drive sales by offering some great discount, but resist that temptation. Yes, all things being equal, you’ll buy the less expensive item every time. But how often are things truly equal? Isn’t it also true that you get what you pay for?

Small businesses usually can’t compete on price with national retailers, but they can run circles around the big boys when it comes to service, quality, and truly caring for the customer. Discounting doesn’t send that message, it very often sends the opposite message. Ignore the direct mail and direct marketing guys and use it sparingly.


Quick and Inexpensive Advertising

Last week, a commenter responded to a post asking, “what are some simple ways or advertising medium that a business owner could turn to if they had to cut back [on their advertising].” Here are some concrete things you can do to promote and advertise your business at very little cost. In the long run, you’ll want to do more than this to grow your business, but if things are tight this will keep you in the game.

1. List your business with Google Places and Bing Local Listing.

According to Alexa, Google is the most visited web site in the world. Bing is Microsoft’s new search engine that launched last year and is becoming one of Google’s biggest competitors in search.

Both search engines allow you to list your business for free, although you do need to sign up for a free account with each one. If you have gmail, then you already have a Google account. If you have a Hotmail address, or a Windows Live ID, then you already have an account with Bing.

Once you’ve added your company’s information, anyone who searches for your business name and city on that site will find you at top of all the other search results.

If you have a web site, be sure to include that in your Google Places and Bing Local Listing information.

2. Start a blog and tell people about your business.

There’s lots of free blogging solutions on the web. Some of the more popular ones are WordPress, Blogger, Tumblr, and Posterous. You don’t need a web domain name or anything, just sign up and start writing about your business — what you do and why you are different from you competition. Don’t just write one entry. Write something at least twice a week.

If you have a web site, link to it in your blog posts and “about” page. And be sure to include your blog’s web address in your Google Places and Bing Local Listing entries.

3. Let your friends, colleagues, current and past clients know about your blog.

Don’t blast them all in a single email. Take a few minutes each day and send out a half-dozen or so emails letting those people know about your blog. If you have a Facebook account, tell about the blog in your status update. But be nice, and don’t annoy anyone as you tell them.

Everything I’ve suggested here is free — there is no cost to your business other than the time it takes to do it. You’ll want to move on to other forms of advertising as your business picks up, but in the meantime you are still promoting your business.

Oh, I almost forgot. All the other things I’ve said about advertising still apply.


Put your money where your mouth is.

How much money should you invest in an advertisement? What is an ad really worth?

I know of a furniture company that refused to pay more than a couple of hundred dollars to produce a TV commercial. This was after I had told them they should plan on spending at least $1500. Their furniture wasn’t cheap, but they’d type up a flyer and photocopy it for their direct mail rather than paying for a print run of mailers. They were frugal, to put it mildly.

An industrial equipment manufacturer called me up one time for marketing advice. I recommended spending five thousand dollars on a demonstration video to show what their equipment did and the benefits it would have for their customers, but that was more than they wanted to spend.

The funny thing is, the products of both companies were expensive. In fact, each of those companies sold several items that were far more expensive than the cost to make a decent video or TV spot. Why is that funny, you ask?

Both of those companies asked each of their customers to spend thousands of dollars on a single item. Yet they wouldn’t invest an amount of money that was less than the cost of the item they wanted to sell to convince a boat-load of customers to buy that same item. They were not willing to spend what they were asking their customers to spend, even if it meant making a lot more sales. Ironic, isn’t it?

Now you shouldn’t use the cost of your product to determine the price to create your ad. I’m not suggesting that. In fact, if you own a coffee shop then the cost to make an ad will be far more than a single cup of coffee. But you do need to think about what your advertising is worth. Your advertising and marketing needs to reflect the quality of your product or service. If you are not willing to make an investment to sell your product or service, why should your customer make the investment to purchase it?

If you sell a great cup of coffee, then invest a little to let people know. Don’t spend money you can’t afford, but make your marketing as nice as you can. It should look like it took some thought and effort on your part. A person should look at it and think, “This small business offers something valuable.”

Rethink your advertising and marketing. Its not a cost that should be avoided, its an investment that should bring a return. If you aren’t spending anything to promote your business, then people will think that your business isn’t worth promoting.


You’re looking at today’s yellowpages

When was the last time you picked up the phone book?

Now when was the last time you googled a business name to find their phone number?

Last year, I scaled back one of my client’s YellowPages spending. We dropped all of their ads in every category, opting for bold listings instead. The client told me yesterday that they haven’t noticed any change in traffic. Earlier this year, we launched their web site. Business is picking up.

It used to be that if you weren’t in the YellowPages, no one would find you. Now, if you don’t have some sort of web presence, no one will find you.


You Can’t Reach Everybody

When planning your advertising, one thing that paralyzes many small businesses is that they can’t decide on where they should put their advertising dollars. There are so many places that will gladly take their money while claiming to be “#1!” in their niche, so this is understandable. Most small businesses don’t have a huge ad budget, if they have one at all, so there can’t be any waste, which causes them to hesitate and delay. They are stuck, still asking the question, “where should I advertise?”

I get asked that question all the time. I do a little research into their market, and try my best to give them an honest answer based on my experience and research. It is interesting how often I am met with the same response.

But first, the back-story

Before we get to that response, let’s set up an example. Your business sells a product that would greatly benefit if potential customers could see the product selection. If you sell jewelry or furniture, this would apply to you.

Slightly off-topic, free strategy lesson:

Everyone knows what a Ford F-150 pick-up looks like, so you can talk about it without showing it.  Everyone knows what a couch looks like, but what does your couch look like?  Same for jewelry.  One-carat diamond rings look vastly different from ring to ring.  Hmm, maybe you should show your product in your advertising.

Now back to our topic.

Your hypothetical business sells a product that could benefit from showing the product selection in your advertising. Based on your budget and your area, I recommend to you cable television.

I very often get at least one of three responses:

“But doesn’t broadcast TV reach a lot more people?”

“But not everybody has cable.”

“But a lot of people have satellite TV instead of cable in my area.”

What I would like to say is, “So?” But instead I answer a polite, “Yes, that is true, but that doesn’t mean that you shouldn’t advertise on cable.” Why is that? Because your goal isn’t to reach everybody — no one can afford that. Your goal is to simply to reach people in a way that is affordable, effective, and productive.

Here’s an illustration

Back when I was a kid, everyone read the newspaper. However, there was usually two competing newspapers in a town, so unless you had a large enough budget to advertise in both newspapers, you had to choose one. Most people chose the newspaper with the largest subscription base, because it reached the most people. They never gave a thought to the people that read the other newspaper, whom they were not reaching with their ads.

There were businesses advertising in that smaller paper. They did it because they wanted to reach those readers. They understood that the larger paper charged more for its advertising because ads in that paper reached more people. Because the smaller paper reached a smaller number of people, the ad rates were less.

Now let me ask you something. You have one advertisement. You run that ad in both newspapers.  Which ad is more effective? If the ad is the same, then it should have the same effect on the reader regardless of which newspaper they see it in, right? So then, the businesses that only ran in the smaller paper saved money by targeting a smaller group of people.

That was back then, now newspapers are declining and are in danger of disappearing altogether.  But you still have this same situation with radio, TV, and the internet.

So where should I advertise?

There is usually more than one radio station in your area, more than one television station, and a whole world of web sites. You can’t reach everybody, but you do have to reach somebody. It is silly to base where you will advertise on how many people you won’t reach. Instead, base where you will advertise on how many people it reaches and what it costs to reach those particular people.

Here’s some truth in advertising for you: the fact is that reach, the number of people who see your ad, is seldom the problem with a business’s advertising.  More often than not, the problem is the message or the frequency (the number of times a particular person sees your ad). It really doesn’t matter if you choose TV, radio, newspaper, or the internet, as long as your message and frequency are right.

So craft a great message and run it multiple times over a period of time. You’ll see results.


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