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Advertising How-to Guide for Small Business

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Advertising How-to Guide for Small Business

Understand the pros and cons of different types of advertising, typical ad costs, get tips on how to save money along with help developing your ad plan, finding ad experts to hire and reviews of top suppliers for advertising services.

Six questions to ask yourself before you start advertising

  1. Is advertising the best marketing tactic to use? (Or would something else work better?)
  2. Do you want to create an ad campaign or just an ad?
  3. Where do you want to advertise? (locally, regionally, nationally, online only)
  4. What’s your ad budget? Is that enough to do an effective job?
  5. What type of advertising do you want to create?
  6. What do you want to do yourself? What do you want to hire an agency or freelancer to do for you?

Decision #1: Is advertising the best marketing tactic to use?

From our experience: Many companies rush to do advertising when another type of marketing may work better. Before you advertise, understand the alternatives to advertising. This article will help you understand the pros, cons, costs and alternatives so you can determine what will work best for your needs and budget.

Decision #2: Ad campaign or just an ad?

A campaign is advertising placed on different media (TV, radio, newspapers, magazines, outdoor billboards, online, etc.) that is unified by a common theme, visuals and message. Your campaign can be extended into all of your marketing.

Advertising is creative business, yes. But ultimately ads are sales pitches. Effective advertising should be like creating (or cloning) your best sales pitch or best sales person. Sure, it helps if the ad is interesting and clever but the bottom line is: Did it get a sale or move the prospect closer to a sale?

There are two primary types of advertising:

Brand ads that aim to create, change or enhance the brand personality and positioning. These ads are like business development people who identify, educate and nurture prospects and existing customers.

Direct response ads that are like sales reps on quota. These ads are designed and measured by how well they convert prospects into buyers and how much revenue they generate.

From our experience: Most agencies and freelancers are not good at both brand and direct response advertising. They specialize. And they tend not to see eye-to-eye. Direct response ad experts consider brand advertising “fluffy” and brand ad experts consider direct response advertising transactional, unemotional and unimpressive. So, if you want to develop a campaign using both types of ads, you’ll need to act as the orchestra leader.

Developing an ad campaign takes more work and costs more up front, but it pays back by establishing a stronger brand reputation for your product, service, company or non-profit organization. The theme and messages from the ad campaign can be used in other sales and marketing materials to further integrate your marketing. Consistency reassures customers and prospects and makes a brand look like a leader. It’s what Starbucks and McDonald’s and most major advertisers do because it works. Small businesses and non-profit organizations can do this too.

By using different advertising in different types of media in your ad campaign, you’ll benefit from what’s called the “Media Multiplier Effect.” Major advertisers have learned when they use more than one type of media (generally TV and print), that the recall and communication of their message is greater than when they only use one type of media. Think of it this way: A sales rep who uses phone calls, sales meetings, email messages, printed letters and multi-media presentations will be more effective than someone who only uses one communication vehicle.

Campaigns need a “big idea” that will work across all marketing. and that takes time (and luck) to create. It’s better to run one-off ads that are effective than trying to unify everything under a campaign theme that isn’t great. It’s the trade-off of integration versus effectiveness. Ideally you’d like both.

Decision #3: Where do you want to advertise?

  • in a town? in a metro area
  • nationwide? or in several metro areas?
  • online only?
  • to particular business-to-business vertical markets?

You have a lot of choices about where to advertise. In the U.S., there are:

  • more than 1,300 TV stations
  • more than 500 cable networks
  • more than 19,000 magazines
  • more than 10,000 radio stations
  • more than 6,000 newspapers
  • more than 100,000 websites

Know this: There are huge pricing differences between major metros (like New York vs. Phoenix) and smaller markets.

If you can’t afford a national campaign, then consider advertising in cities and major metro areas where you have the most sales opportunity.

If you’re buying advertising in a local city or what’s called a market (a city plus the surrounding suburban areas), then it may be manageable to research and buy ad media space yourself.

If you want to make a regional or national ad buy, you will be calling a lot of media sellers to get rates and then when you decide what you want to buy, you’ll need to call back to negotiate rates. From our experience, it’s smart to find a knowledgeable media buyer to do this work for you.

Decision #4: What’s your ad budget, and is that enough to do an effective job?

There are two major costs for advertising:

  1. Creating and producing the ad concept/idea. These costs vary depending on what type of ad you want to create (TV, online, print, etc.) so those costs and tips on the least expensive options are covered in the overview sections for each type of advertising,
  2. Costs for ad space (called media in the advertising world) should represent 80% or more of your budget.

Know this: A little bit of advertising doesn’t work. Major advertisers, who invest in expensive research tracking studies to understand the recall and impact of their advertising in market, know that without adequate reach and frequency levels and enough media weight (dollars spent), the investment in advertising doesn’t work.

Buying ad media space is like buying real estate in the way that prices change constantly based on supply and demand.

Traditional advertising (TV, radio, print, billboards) is purchased based on:

  • Reach: The number of unduplicated households or people exposed to a program, group of programs, or an advertiser’s schedule over a specific time period. Think of reach as the TV and radio equivalent of circulation for print.
  • Frequency: The average number of times people have an opportunity to see/hear your ad message during that time period. Remember, this is opportunity to see, not a guarantee that people actually will see your ad.

The industry standard for minimum advertising effectiveness levels is reaching at least 70% of the target audience at least three times during a four-week period.

From our experience: Many small businesses don’t invest enough money to reach minimum levels and are frustrated that the advertising didn’t work. Business owners and managers say things like, “To date we’ve done several random email, web, and mobile ad campaigns, but I need start driving a more consistent awareness program that I can then build the in-store activities around.”

If you can’t afford the “big ad plan,” then consider:

  • Focusing your advertising to a smaller geographic area to be able to afford adequate reach/frequency levels.
  • Narrowing the target audience. An example: Instead of reaching all women, maybe you focus on a subset of women who are most likely to buy, like moms with young children.
  • Identifying particular shows, magazines, websites that your target audience watches/listens to/views and developing a plan to reach those people with consistent frequency so your ads and messages are recalled.
  • Using other marketing approaches like direct mail postcards, email marketing, PR or social media marketing.

Decision #5: What type of advertising do you want to create?

There are many different types of advertising to consider. Here are some examples:

  • TV ads
  • Radio ads
  • Newspaper ads
  • Magazine ads
  • Online ads, often called banner ads
  • Search ads on Google and other search engines (these are also called PPC ads which stands for pay-per-click)
  • Ads on outdoor billboards along freeways and within towns
  • Ads on cell phones (this is called mobile advertising)
  • Ads in coupon mailers and local shopper magazines

Decision #6: What do you want to do yourself? What do you want to hire an agency or freelancer to do for you?

This decision is like one you’d make if you were building a house.

Do you hire a general contractor who finds the sub-contractors and manages the project? This is the equivalent of hiring an ad agency.

Or, do you act as your own general contractor? This is the equivalent of hiring freelancers like graphic designers and media planners to work for you as subcontractors, and you orchestrate everything.

Pros of acting as the general contractor for your advertising

  • You’ll save money
  • The ads will be done exactly how you want them to be
  • You’ll learn a valuable skill and be faster and better at doing next time
  • Practical to do if you are only running a few ads in a few places

Cautions about acting as the general contractor for your advertising

  • Is this the best use of your time?
  • Could you be making more money if you were doing something that was generating revenue and paying someone to do this for you?
  • Staying on top of all of the details takes a lot of time
  • Are you good at this? Mistakes are costly in advertising financially and for your company or brand’s reputation.

From our experience:

Advertising is very visible and expensive. You want to avoid costly mistakes. You want to benefit from someone else’s expertise in knowing how to do this well so your ads look professional and you get the best ROI.

If advertising is a significant portion of your budget and you’re doing more than running ads in just the local paper or a few trade magazines or the same two radio stations, it’s wise to hire a marketing expert to manage this.

That expert could be an agency or a freelancer or an employee who will act as your advertising manager.

Know this: Different agencies have different “minimum budget” thresholds for clients. They generally don’t say what this is on their websites. If you have too small of a budget, an agency either won’t take you on as a client or you’ll be a small fish in a big pond and not get the help you expect.

What’s a large enough budget for an agency to take you on as a client?

  • If you’re a national advertiser, most agencies will take on clients who have an annual budget of at least $75,000 (but you will generally be a very small account at the agency).
  • An agency that just offers “interactive” or “digital” marketing (their name for specializing in online advertising, websites, search marketing, email marketing), will generally accept clients who can pay them $5,000 a month on a retainer or $60,000 a year.
  • If you’re a business-to-business advertiser who plans to do advertising beyond a few trade publications and websites and have at least $50,000 to spend a year, then consider an agency. But look for an agency who has several business-to-business clients.
  • If you’re advertising in a local city and want to use a wide range of media types (TV, radio, print, online, outdoor billboards) and have the budget to afford this, a small agency who knows the local media will be glad to take your account.

If you want to use freelancers

You need to decide who will be responsible and accountable for orchestrating all the players to get your advertising done on time, on budget and on strategy. That could be something you:

  • Do yourself
  • Hire a freelancer to act as your company’s acting Ad Manager
  • Assign the role to an employee or partner
  • Hire someone to join the company as the Marketing or Ad Manager

Know this: Among advertising professionals there are “thinkers,” “creators” and “doers.” They don’t call themselves that, but that’s essentially what they are good at: thinking/planning, creating, or implementing/project management.

From our experience: When many small businesses want to do advertising they select a graphic designer and expect them to think-create-do. That works with a small ad budget. But if you’re creating an ad or marketing campaign, we’d recommend you first find a marketing thinker (a strategist) who is good at project management to act as the general contractor for your advertising.

What not to do when determining what you’ll do yourself and what you’ll hire experts for:

Think you can do this yourself and then realize you don’t have the time or get a big deal that’s more important. Once advertising media is purchased, that’s a firm deadline. If your ad isn’t ready or you don’t think it is good enough, you generally can’t get out of the contract. You have to run something. It’s very important to do a great job at project management to meet media insertion deadlines with ads you like.

Don’t choose someone who is inexperienced (meaning inexpensive) to manage the advertising when they don’t have anyone to mentor and guide them. Bad for them; bad for you.

Don’t hire a freelancer based primarily on their “low hourly rate.” If they are experienced with a good track record and references, then you’ve gotten a deal. Most likely, if their price is really low, they are inexperienced and you’ll be paying them to learn on your dime. They’ll charge less per hour but take more hours than an experienced person would.

Be cautious about hiring a creative team or copywriter who is based outside of the U.S. where there are potential language and cultural differences. From our experience, if advertising needs to be culturally relevant to Americans, then it’s best done by Americans.

Don’t hire an ad agency to develop your advertising and pay them to also recommend and manage ad testing. How is anyone who works for the agency going to tell you as the client that “the ads didn’t test well?” Think of ad testing and research like a financial audit. It should be done by an independent expert.

Marketing Zone
14040 23rd Avenue N.  
Minneapolis, MN 55447
612.440.4500
Info@MarketingZone.com

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