On the heels of the biggest football game of the year, there is a lot of press about advertising and commercials that cost millions of dollars each. But do they really work?
It is debated in companies and marketing departments around the country whether advertising is effective. That debate can become heated when it is time to set an annual budget. This topic also pops up often in our business culture and on college campuses. It even creeped into my earbuds recently on a five mile run. I dedicated almost two hours listening to one of my favorite podcasts, Freakanomics, questioning if advertising works to drive sales. (here is a link to part one of that podcast https://freakonomics.com/podcast/advertising-part-1/ for your enjoyment). It is an engaging, well produced story full of experts and statistics, like most of their podcasts. Their points and counterpoints almost made me rethink my career choices. Then I realized that this story was missing a couple of key elements. One was that they focused heavily on driving sales growth when sometimes the sales growth opportunity is limited. For many businesses, sales growth shouldn't be the only goal for advertising. Market share can be equally as important and could be the goal just as often. See the year 2020 as sales growth was not in the cards for most companies. The second point missed in the podcast was realistic scale. Almost all examples they use as examples were huge retailers or giant ecommerce companies with few competitors. These companies dominate in their respective fields. The producers of this podcast missed the mark with everyone else. According JP Morgan Chase, 99% of America’s companies are small businesses with 88% of employers having fewer than 20 employees. For these firms, advertising does indeed work when done correctly.
But what about the times you have tried and it didn’t work? Hate to say it, but you probably did it wrong. Advertising is a blend of Science and Art. If you don’t have the right plan (the Science) or the right message (Art), advertising won’t work. If you get them right, you will feel it all the way to the bank. Let’s take a look at this combination of Science and Art to help guide you. We’ll tackle Science first.
There is an old adage that says, “If you fail to plan, then you plan to fail”. So the first step in advertising, or the “Science” of it, is to have a plan. Make sure the plan starts with a clear understanding of who you want to target. Focus on the best customers you want and not necessarily the average customer that you have. It’s a safe bet that 80% of your revenue comes from 20% of your customers. That 20% is above average and is a good place to start with your targeting. Next you have to find the right tactics to hit that ideal target. You can find them through Google Ads, Display Ads on relevant websites, Direct Mail, Social Media, Television, Radio, Streaming platforms like Pandora, Spotify, and Hulu plus many more platforms. Do a little research to find the best 2 or 3 tactics that will hit the biggest possible number of your most profitable prospects. Then hit them frequently with your message. To be clear, this is not a shotgun approach. It is a very strategic, focused, “rifle-like” approach. If you live in an area with 1,000,000 people, 1% or less may fit your description of the best prospect. That is 10,000 people or less. Find those 10,000 people and start talking to only them. You can't be everything to everybody, so no need to include everybody in your targeting. Lastly, your plan has to include an unbiased or an objective way of measuring its effectiveness. You won’t know if it works if you’re not counting something, leads, web traffic, foot traffic, sales, etc.
Now let’s talk about “Art”. I can't stress enough how important the message is in allowing any plan a chance to succeed. The best plan in the world won’t work if you have the wrong message so let's discuss what to avoid first. Avoid talking about yourself to soon or too much. No one really cares how long you have been business. No one really cares how many awards you have won either. While it is a good thing, most don’t need to know how many charities you support. Unless, you can tie any one of these statements directly to why they should do business with you, leave them out. The number one thing they do care about is why should they give you their hard-earned money? Your “why” should be the first thing, they see, hear, or read in your outbound messaging. Then they need to know how you do what you do with a clear call to action. That "how" can be because your product or service makes their life better in some way, saves them money or makes their life easier some way. Don't be shy with your call to action, tell them to "Feel Better Now", "Call Today", "Book Early" or whatever you would like them to do. Once you have led the prospect this far into your message, now you can let them know who you are. If your history, awards, or charitable contributions are important to you put them last in your advertising or dedicate a whole page to each on your website. But if you invest advertising dollars on things that are important to you and not your customer, then the best plan in the world won’t work. Last but not least, don’t expect to get your message right on the first try. Test different messages to see which work better than others and be prepared to change it throughout the life of a campaign. Most ad messages have a shelf life so don’t be afraid to move on from it when it is time.
To wrap this up, for advertising to work you need a plan and the right message. That plan needs to be well-thought out, focused and measured. Your messaging needs to be on point, letting your ideal customers know why they should work with you, how they can and then who you are. Messages will plateau and then have diminishing returns so be prepared to change it out following the same rules all over again.
And the last point I will make on the question of does advertising really work, you found this blog through advertising… so yes, yes it does.
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