Your competitor is talking to your customer! Are YOU?
I hear it all the time, “…times are tough…budgets are small…we have to cut costs.” What’s the first item to get the axe? Advertising. The truth is, ceasing your advertising efforts WILL NOT save you money!
The biggest problem is that when times get tough, people don’t only stop advertising—they stop marketing completely. Advertising is just one marketing activity, and it happens to be the most expensive. Although advertising, in some form, is a necessity in your marketing mix, you shouldn’t be relying solely on that one piece.
We know that the 3 ways to increase revenue are to increase the number of customers, increase the average spending per customer, and increase the frequency of purchase. Advertising is just one of many marketing activities that should be part of your overall mix. If you’re relying solely on advertising, you will find yourself in big trouble when your budget runs thin.
Before you put your advertising efforts on the chopping block, learn how to separate fact from fiction. I give you the top 5 excuses for canceling advertising efforts and the facts that negate them.
Excuse #1: “It’s too expensive. We can’t afford it right now.”
Fact: It doesn’t have to be expensive, and “right now” is when you can least afford not to do it.
People are led to believe that if you just spend more money on advertising, you will automatically get more business. Because of this, the same people automatically think that advertising costs too much, and if they can’t spend a lot of money then they can’t do it, at all. This is simply not true. Advertising becomes more expensive than it needs to be when people throw money at it without having a marketing strategy in place.
But what does marketing have to do with advertising? Although they are often lumped together, advertising and marketing are not the same. Marketing is preparing your product for the marketplace by first identifying your market, understanding who they are and what they need, and aligning your brand around this need. Advertising is making your product known to this identified market. Advertising tells your market that the solution exists in a non-personal, very public manner. Marketing makes it personal and tells them why YOU are the best provider of this solution for them.
Based on these definitions, you can see that advertising and marketing are interdependent. Where companies fail is spending a lot of advertising dollars on the wrong product, focused on the wrong market, or in the wrong place, with no tools for measuring effectiveness.
The answer to your budget problem is not to stop advertising, but to look more closely at the strategy (or lack thereof) behind your advertising to find out why it’s not effective. Is there any marketing behind your advertising?
Excuse #2: “I can’t waste money on advertising. I need to bring in more business first!”
Fact: You will not bring in more business if nobody knows that you exist.
That existence piece mentioned above is what makes advertising, in whatever form it takes, so important. People often feel that advertising (and marketing in general) is an optional expense than can be pushed aside until more business comes in to pay for it. But, how will you get more business if nobody knows or remembers that you exist?
Marketing is not always about landing a new customer, but retaining your existing customers! In a saturated market, it doesn’t take long to be forgotten, or for someone else to swoop in on your territory. Being successful in business requires consistent communication with your audience. If you don’t maintain a continuous dialogue with your customers, someone else will. In fact, your competitor is talking to your customer right now! Are YOU?
Advertising isn’t free and marketing will always require an investment in time and/or money, but it does not have to crush your budget. However, the level of your investment will determine your reward. No investment, no reward.
Excuse #3: “We don’t have time, we’ll focus on that later. Let’s just concentrate on our current customers right now.”
Fact: You can’t wait until you need customers to start looking for them.
The “busy season” is the biggest marketing killer on earth. The truth is, every customer has a lifespan. Your favorite, most pleasant, most profitable client probably won’t be your client forever. Needs change, the market changes, and businesses evolve. If you wait until your roster is empty, it’s already too late to start advertising. People can smell desperation a mile away, and desperate marketing never brings in the right clients.
When you get desperate, poor decisions are made. Money is thrown at the wrong advertising channels, the wrong marketing efforts, with little hope for some kind of meaningful return. Effective marketing sends the right message to the right people at the right time in the right way. It’s a continuous process, not a last minute task. The key is to have an effective, affordable marketing strategy that consistently keeps you visible.
Excuse #4: “We don’t need it! We have invested ZERO dollars in advertising and look how much we’ve sold!”
Fact: You’re not as awesome as you think you are. Somebody out there is doing what you do faster, better, and cheaper.
People love to brag about how little money and effort they put into marketing their groundbreaking, revolutionary, awesome, never-seen-before product. It’s not uncommon for these companies to hit a plateau, and when their sales go flat, they wonder how to get back on top of the mountain. No matter how wonderful your product is, people have to be aware of it and the value it brings before they will buy it. Your marketing and advertising take care of that.
Excuse #5: “It’s not that important.”
Fact: Yes it is. A lack of advertising actually fosters a negative customer perception.
Did you know that almost half of the U.S. population believes that a lack of advertising from a company indicates they must be struggling? This is another reason why it is critical to keep the marketing wheel rolling! Customer perception heavily influences purchasing patterns. Businesses who are constantly advertising are perceived as competitive and committed to doing business. So, as you can see, advertising is not just about immediate sales. It’s about bolstering consumer confidence, which in turn boosts revenue and market share so that when the money becomes available, you’ll be the first one to get it.
What creates your customers’ perception of your business? Marketing! You need to be in control of how your customers perceive your business. If you don’t create this perception, either your competitors will, or your customers will make up their own. Do you really want your competitors telling your customers what to think of your business? Do you want your customers to rely on their own assumptions?
If you have a marketing strategy already in place that is consistently working on your behalf, tough times won’t be as tough. Marketing is about so much more than advertising and selling. It’s about the customer experience as a whole. In my next post, I’m going to talk about why you need to care about your customer experience—the core of your marketing efforts.
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