You can improve your advertising performance by first understanding what type of sale your business is making. Knowing this information is critical to creating a marketing strategy for your business.
Most small businesses have a love/hate relationship with their marketing. They LOVE what a well crafted marketing campaign can do for their bottom line, but they HATE what they have to go through to create such a campaign.
It’s been my experience that most small business advertising spending is of the “spray and pray” variety. These owners spend without a plan and then try to trim the excess after the fact. This can have disastrous results.
Trying to get the most out of your advertising dollars is nothing new. Considered the father of modern day retailing, John Wanamaker grew his clothing store into the first department store. In 1876 he opened a restaurant inside his store. Two years later, he installed electric lights.
In the Who Made America series on PBS, his stores are called “palaces of consumption.”
He was constantly thinking outside the box when marketing his business. In 1874, he printed the first-ever, copyrighted store advertisement. In his ads, he promised quality goods and offered a money-back-guarantee. When people discovered the promises he made in his advertisements were true, business boomed. Remember, this was a time when “snake oil” salesmen roamed the land making outlandish promises to sell their wares. These peddlers then slipped off to fleece the residents of yet another town.
Wanamaker is widely credited with saying, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.”
I’m sure the inventor of the department store would be amazed at how precisely experts can measure the performance of their advertising dollar today.
I was once called in by a business owner whose business was on the verge of closing. He needed help and he needed it fast. During our initial meeting, I asked him to describe a time when his business was successful. His face light up as he told me of a time when his business was thriving. I then asked about the advertising he was doing at that time. He was using a variety of media – television, radio and various print publication. Then I asked him when things started to go wrong. He thought for a moment and decided the decline started when he tried to measure the effectiveness of his advertising. Like John Wanamaker, he was pretty sure more than half of his advertising dollars were being wasted. So he began “measuring” his advertising’s effectiveness.
He did his “analysis” by simply asking new customers how they heard about his business. When new customers didn’t mention his recent television advertising campaign, he canceled his TV advertising. When new customers didn’t mention his radio ads, he canceled his radio advertising. One by one, he described how and why he had canceled his advertising contracts with various media outlets. By the time he finished telling me of his analysis, he realized what he had done.
The decline in his business had happened gradually. Each time he cancelled a media contract, he punched a few pin holes into his campaign bucket. These pinholes didn’t drain the bucket immediately. Instead, his business began trickling away slowly. The decline was so gradual that he hadn’t recognized the cause and effect until he was recounting the decline of his business to me.
He’s not the first business owner who’s tried to measure his advertising performance by polling his customers. However, his tale was one of the most extreme I’ve heard. He had contacted me because I had developed a reputation in the area for helping business owners operating on a shoestring marketing budget to get great results. By the time he contacted me, he couldn’t even afford the shoestring. I couldn’t help someone who had no money for advertising and that’s exactly where he was. The problem with polling your customers is they often don’t know why they made their choice.
I’m reminded of another client I worked with years later who also decided to measure his advertising by polling his customers. At the time, we were running a carefully crafted marketing campaign. The campaign was designed with the call to action as “Visit our website.” I had to fight with the media rep and the production company over the call to action. They were still in the habit of using “stop by today” as a call to action, but I wanted to use the site’s log files to measure the campaign’s effectiveness.
My client didn’t know his web site traffic had spiked considerably as a result of the campaign. What he did know was he was seeing new customers. He was understandably excited. It was the first time he had ever seen results from his advertising. I cringed when he told me of the grilling he had put one of his new customer through.
He first asked, “Did you see our ad on TV?” The customer replied, “No.” My client wasn’t one to give up. “Did you find us on the web?” Again, the customer said she hadn’t visited the website. My client told me he kept pressing for an answer. I imagine about that time the customer was regretting the decision to visit his store. In an effort to end the line of questioning, the customer finally blurted out, “I saw a sign when I was on the way over here.” My client was crushed. We weren’t running billboards or using any other signage. There was no sign on road she had traveled. (Yes – he kept pressing to find out WHERE she had seen the sign. SIGH!)
Fortunately he decided to begin polling his customers while he was actively working with me. I was able to explain to him that even though the new customer had wanted to help, she couldn’t. She didn’t know WHY she had chosen his business. That’s why polling your customers is a really bad idea. That’s why the campaign’s call to action was not “stop by today.” Instead it was “visit the website.” I was able to measure the effectiveness of the campaign by the increase in visitors to his website. However, the real measure of effectiveness was the new faces he saw as a result.
Takeaway: Most consumer buying decisions are too complex to track by a single metric. let alone by random customer polling.