Why should you pay for advertising when “Word of Mouth” is the best form of advertising and it is free?
Let’s begin by agreeing that yes, “Word of Mouth” is the best form of advertising. Best is the word we need to look at and see how it has led many business owners to financial ruin. In the statement “best form of advertising” business owners often misinterpret the word “best” to mean – “the only form of advertising required.”
According to Dictionary.com the word “best” is defined as: of the highest quality, excellence, or standing, most advantageous, suitable or desirable. Nowhere in that definition do you see the words “only” or “exclusive”. This is where a lot of business owners lull themselves into thinking that a sign on the side of the road, or worse yet in their window, is going to bring in the volume of consumers needed to generate enough business to keep the doors open.
The only signs that are going to thrust hundreds of people into your business this weekend are those advertising going out of business sales.
This is where we need to define three key terms with a pretty broad brush:
Advertising: the act or practice of calling public attention to one’s product, service, need, etc., especially by paid announcements in newspapers and magazines, over radio or television, on billboards, etc.
Marketing: the total of activities involved in the transfer of goods from the producer or seller to the consumer or buyer, including advertising, shipping, storing, and selling.
Brand: kind, grade, or make, as indicated by a stamp, trademark, or the like- the core representation of your business in the marketplace.
As a business owner or manager you need to have an understanding of the relationship between all three of these components and how they impact your business. Brand building is a process that if not made to be a deliberate part of your business plan will inadvertently be built without your knowledge and control. We have all seen a business that we refuse to go into because of bad experiences we have had by ourselves or shared by others or that simply is completely unappealing for physical or emotional reasons.
There used to be a “family entertainment” store nearby that had a giant 3D skull hanging off the side of the business by the front door. Not a very family friendly outwardly appearance. Once inside the overwhelming array of products and the attitude of the sales associates made for a less than comfortable sales experience. The results were a brand image that said not family friendly and not worth the hassle. They have since gone out of business.
Your Marketing Plan inside your overall business plan needs to be very detailed and is unique to your market segment, but most commonly included items are:
- Situation Analysis
- Marketing Strategy
- Sales Forecast
- Expense Budget
Included in your Marketing Plan should be the basics of your advertising process as well as your lead generation and lead conversion strategies.
Advertising’s job, no matter what medium you use, is to get qualified leads to act. This can be coming through the door to your business, making a phone call, or visiting your website. The job of closing the sale is the responsibility of you and your staff. There was a locally owned store that sold household items with a starting point of around $4,500. The staff was not required to, and often even the owner refused to, ask potential customers who came to the store front (and spent a considerable amount of time with a staff member) for their contact information to follow up with after the customer said, “I need to think about it I’ll come back next week.” Needless to say untold thousands of dollars in sales were never realized and they are now out of business.
Lead generation with no lead conversion system in place is a waste of money.
So that brings us back to the question why spend money on advertising? Salesmanship 101 is all about keeping the Lead Generation Funnel full. In today’s society consumers are bombarded with advertising messages every waking minute of the day and if your potential customers are watching TV, on Facebook, or for that matter just breathing they are or are about to be presented with a message from one of your competitors.
Don’t believe for a minute that some of the “free” Word of Mouth about products online and even in your community aren’t actually examples of incentivized advocacy. That’s right- they’re being paid! It may be in the form of free of T-shirts or burritos, but somewhere someone is receiving something for all of those great warm fuzzy representations of that company. Why? Because it was in that company’s marketing strategy to build brand through this process.
If you have been alive for greater than 6 years you know what a Big Mac is, but yet McDonalds continues to advertise and build that brand. Why? So that they have top of mind presence when you are hungry and trying to figure out what it is you are hungry for.
Domino’s Pizza wins my personal award for effective brutal branding. Their product was terrible and their service worse, but somewhere they changed leadership and realized they needed to change their product. After reworking their recipes and discarding all WWII surplus sauce they began the process of rebranding their company and their product. They engaged the market aggressively with promotions and embraced customer feedback. This is huge! Domino’s recognized that they need to tell the marketplace of their epiphany and the resulting changes. They also utilized the customer feedback as part of their advertising allowing them to connect with their consumers and build relationships. Their approach included using all forms of media from TV to print, to radio, to the Internet, and even incentivized advocates.
That’s because there is no “Silver Bullet” when it comes to advertising. It requires multiple messages on multiple media. Keep in mind that the age old standards of reaching the right audience with the right message at the right frequency remains as the longest running truths about advertising.
If you are not building your brand and advertising your current products you are losing market share to your competitor who is. Without your voice in the marketplace you are allowing them to dominate at your expense.
Doesn’t it drive you crazy to hear someone say, “I had no idea you guys were even here. I’ve been driving by this store for years and didn’t even think to stop in before today”- then do something about it!
As a business owner or manager your job is to grow your business, our job is to help you. Call us today at 513-617-0906 or send us an email us.