The answer is if you cannot test it, or research it, then you should not buy it.
This article will help you when buying advertising for the first time OR renewing your current advertising.
Many business owners throw money at advertising and use the “wait and see” strategy. This is the most expensive way to advertise. A bigger problem is that the advertising might be working but since you have not put a way to measure the results you don’t know if it worked when it actually did so you pull it and wonder what happened to the customers.
When you are approached by an advertising salesperson make sure you decide based on numbers and facts not on your emotions.
Ask these basic questions BEFORE YOU COMMIT TO A CONTRACT (make sure your lawyer reviews it):
What are the exact demographics of the people viewing the advertising?
This is why it is extremely important to know your own customer demographics.
How many people will be viewing the advertisement? Or how many people are subscribed to the publication? Watching the TV show? Listing to the Radio at the times your ads are placed? If it is advertising on a website; how many unique visitors view THE EXACT PAGE where your advertising will be placed?
You need to have real numbers as this is how you will determine your CPM (Cost Per Thousand). If the viewers are within your demographics and your CPM is low then that helps you make the decision to go for it. Make sure you know your customers average purchase with you. AND make sure you know what the LTV (Lifetime Value) of your average customer is. Always calculate with a low conversion rate. If it’s direct mail keep in mind a SUCCESSFUL campaign will average 0.5% – 2%. Many times it is 0.25% or less. But the ultimate goal is to get more customers, breakeven (or make a little) then re-market to them.
Can they provide a list of 7 – 10 references that are in your industry who they currently do business with? They might have a problem with same industry references if so ask for same industry outside of the geography you serve.
Every salesperson has their “best three” but when you press them for five that’s when you will see most of them sweat. Don’t forget to CALL EACH ONE and ask them these questions: How long have they advertised in this medium? Is it making them money? Would they do it again? Is there anything you should watch out for when dealing with this company? Add more but these are big.
Can your advertisement be created by your own agency?
Many times I see ads in publications that all seem to look the same. Same layout, same colors, same font, etc. This is probably because they have one or two designers creating the ads. Most graphic designers are not versed in the behavioral marketing that needs to go into an advertisement for it to be successful. Graphics are important BUT message trumps design.
If you supply the advertisement will you get an in-house agency discount?
Most reputable media companies will give you a 10 – 15% discount if you supply the content.
Can your ads have a direct response tracking component?
Make sure you can add a coupon or a specific offer to the ads and if it is a banner ad or link on a website you want to include a custom link that you will track in your analytics program FOR EACH BANNER. If you can’t then you will have a difficult time tracking the effectiveness. I would NEVER consult someone to place an ad they cannot track.
Can you change the ad often and for free?
You want to be able to test, headlines, call to actions, body copy, voiceover talent, subject lines, etc. This is how you create a great advertisement. Be careful as you cannot change more than one this at a time or you will not know what worked.
What are all the options?
Many salespersons are afraid to tell everything that is available because they are worried the price will be too high and you will say no so they “size you up” to what they think you can afford. This is a confidence problem on the part of the salesperson but I will leave that for a future article. So you must ask them as there might be an add-on that would make the advertisement more effective. Ask for pricing considerations for larger sizes or more impressions or more clicks, etc.
What is the length of time for the run?
Short runs seldom do anything as people need to see your advertisements frequently so they remember you. It takes many times to see your ad before someone will take action. If you are doing a 3 time ad in a publication I would suggest you save your money. Most advertising salespersons will disagree but how can you place and test effectively if you are only in for 3 times? YOU CAN’T. Try to get a deal on 9 or more times. Even if the ad is to advertise an event give people enough time to notice your ad.
What is the penalty for cancelling?
You probably will not be able to cancel but there are salespersons who will tell you that even though the contract is for 6 months or a year you can cancel at any time. RUN from them! If it’s not in the contract it’s a problem. You might think that getting an email from them stating it’s possible to cancel at any time would be enough. Most contracts have a clause that states the salesperson cannot change the writing of the contract. I am not a lawyer but that is something you should look out for.
Get everything in writing.
Every question you ask get their answers in writing. Period.
Those should help you.
How to determine if you should re-run an advertisement?
If you are running an ad and it’s time to renew you MUST be able to determine if the advertisement produced the results you were expecting. So let’s say you are one of the many business owners who do not track their advertising expenditures. My counsel must be to re-run the advertisement with a direct response component so you can track the effectiveness. Otherwise you are just gambling. It can be anything but it must be specific and only used in this advertisement. Asking your staff to remember to ask where the customer heard of you is NOT going to be enough as you and them will forget to ask more than 50% of the time. And even if you do ask there is no quantifiable way to track this method.
You should explain to the salesperson that you did not track it so you don’t know if it worked or not. Ask them if it’s possible to give you the same ad at a discount if you stay with them for another run. If it is for a yellow page ad the salesperson will probably tell you all the other new shiny things they can do for you if you renew at the same price. I would not unless each new thing can have its own tracking.
If your ad is on a website you should have analytics set up for your website to see if it generated traffic to your website and or shopping cart. If you were using a marketing automation program this would be easier.
Ok It’s working! Now what?
Let’s say you find the advertisement is working what do you do? You see if there is a way to expand the run, increase the size, run in another similar media in another geographic location. BUT YOU NEVER CHANGE THE CONTENT OR LOOK OF AN AD THAT IS RETURING RESULTS BECAUSE YOU ARE BORED WITH IT!!! Sorry to yell but this is a mistake made by many businesses. Remember unless you have money to throw away then avoid doing this at all costs.
As always you comments are welcomed and appreciated.
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