It takes far less time to win at advertising
By Gordon Hecht, Contributor
It took 63 years for the Texas Rangers (née Washington Senators) to win the World Series. Hail to the champions! But you may have missed the news.
This year’s fall classic was the least watched series in the modern television era. Each game averaged about 8 million viewers in a nation of 335 million (or roughly 2.3%). Compare that to Game 7 of the 1986 World Series, watched by 60 million people when the U.S. population was 240 million (or 40%).
I could write an entire article about baseball, but this column is about advertising, Americans’ changing viewing habits and the way we measure things.
When you advertise in any media, the cost is based on the number of ears and eyeballs that hear and see your message. Rent on a billboard on a busy metropolitan highway costs more than on a side street in Spunky Puddle, Ohio. A classified ad in The Wall Street Journal could cost more than a half page in the Suffolk County, N.Y. News.
Any venue can be a fair value based on the cost. But the impact and reach of traditional media has been shrinking over the last 10 years. While we used to pay dearly for display ads in newspapers and the Yellow Pages (ask grandpa if you don’t know what that is), they have little value today.
Local TV news used to be a strong venue for ad dollars too but viewership has dropped 25% in just the last six years. Similarly, broadcast radio has been supplanted by SiriusXM and Spotify.
Direct mail costs have dropped with the U.S. Postal Service’s launch of Every Door Direct Mailing (EDDM). You specify the ZIP code or area and the local letter carrier will deposit your mailer to every home. Postage is under 20 cents per piece, depending on how many you are mailing.
Before the turn of the 21st century, every bit of advertising by retailers was designed to get people in the front door or to make a phone call inquiry. Then as now, it was important to answer the phone politely and to keep the sidewalk and sales floor clean.
Today, you can still advertise via billboards, radio, TV, mailers or newspapers. But your shoppers are making one more stop before they pack up the kiddies and drive the minivan to your store — they are checking out your website. They are looking at which brands you carry, what’s on sale and what your prices are. They want to text you from your site or push a button to call you. And they want to do that in four clicks or less.
With all the changes in advertising sources, you may want to know where to start. As Glinda, the Good Witch of the North, advised Dorothy in “The Wizard of Oz,” “It’s always best to start at the beginning.” So I start by asking retailers, “If I was new to your town, how would I know about your shop?” Reputation or word-of-mouth doesn’t help newcomers. Neither does keeping your shop the best kept secret on earth.
Newcomers, as well as people new in the market for your products, go online first. Not all of them, just people aged 9-94 or older. You have to create a great website and promote it heavily. You don’t need to be an expert, just find one.
Advertising costs money, but it is an investment, and you need to measure the performance of that investment. One criterion is impressions, which shows how many folks saw your message. Media people will talk more about impressions than Rich Little (go ask grandpa again). But it’s estimated that Americans see 4,000 or more advertising messages a day, so the odds are against impressions ringing the cash register.
Advertising is designed to create calls, clicks and visitors, which the sales team is designed to convert into revenue. So consider these simple metrics:
- Advertising cost per guest (ad spend divided by number of store visitors)
- Advertising cost per sales order (ad spend divided by number of tickets)
- Advertising cost percent to sales (ad spend divided by total revenue)
Measure these monthly and look for trends in effectiveness. Adjust media and message as needed.
We’re fortunate in our retail world. The Senators/Rangers worked for 63 years to find a winning formula. We can research, seek advice and create a winning advertising formula today.
Gordon Hecht is a business growth and development consultant to the retail home furnishings industry and a regular contributor to YSN. You can reach him at Gordon.Hecht@aol.com.