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Small Business Advertising - More Confusing Than Ever!

December 22, 2016

 

Many small businesses face the same challenges when it comes to advertising.  No time.  No budget.  No resources.  In fact, whatever budget is allocated for advertising is often the first to be eliminated when you need it the most - during lean times. Think about it. That's exactly the time when you need an effective advertising strategy the most!  But with limited funds and a lack of insight into how to get the biggest bang for your advertising buck, you could be wasting precious resources.

 

You Need a Plan

So which marketing methods should you pursue? What are the most effective advertising channels for your business? Perhaps like you, most small business owners don’t have the time to do the research. They’re busy running their day-to-day business and doing all they can to keep the lights on. However, as a small business owner, it’s important for you to know that this is one area you cannot afford to ignore. Even a small effort can make a big difference to your business.

 

An advertising strategy must be more than a hit or miss proposition. You’re in a proverbial battle against your competition for every dollar you earn.  And this is how you have to approach your strategy. You must factor in your competition’s tactics and account for their threats.  You have to know what they’re up to and what it will take to win business away.  Don’t fall for aggressive sales pitches touting one advertising channel over another.  That's not a strategy.  Does the salesperson understand your business?  Does he or she even know who your competition is?  You don’t need a sales pitch. You need a plan. That's how you win.

 

So Many Options

There are many advertising channels.  Some good, some bad.  Some expensive and others free. A study by Vocus/Edge Research interviewed over six hundred small/medium business marketing decision-makers who were asked to rate the effectiveness of various advertising channels.[1]   Figure 1 provides a view of the perceived effectiveness of these channels among the respondents.  Of course not all of these channels will be right for your particular business or marketing strategy, but it provides insight into how other small/medium business owners are promoting their business.  It’s important to note that most businesses use a mix of these channels.  The key is selecting the right advertising mix for your business.  Think about how your customers buy.  What do they read?  Where do they frequent?   Social media for example, is a popular (and free!) way to advertise your business and considering the average American spends an average of 40 minutes on Facebook per day,[2] it should be part of your plan   A “fan” page on Facebook for example, is a great way to get customers to refer your business to their friends.  It’s also an excellent way to keep your “fans” up-to-date about promotions and sales.

Figure 1. SMB Marketing Channel Effectiveness Ratings

 

If you’re like many small business owners, you probably advertise through merged mailers. Most are shocked to learn that merged mailers are one of the most expensive ways to market your business when you consider how many leads are generated and of those, how many sales are closed.[3]  Many businesses make the mistake of choosing this option due to its low cost, but looking only at cost is not enough.  You need to also consider the return.  This kind of analytical rigor must be part of your strategy if you want the best return for your time and resources.

 

Sharpen your pencil and do the analysis.  Don’t go into this blindly.  A smart advertising strategy is key to generating sales.  If you don’t have the time or the skills, find resources that can help you. This is a critical part of your business that you can’t afford to ignore.

 

References:

[1] TV Rated Most Effective Advertising Channel by SMBs. 2013. Retrieved from http://www.marketingcharts.com/television/tv-rated-most-effective-advertising-channel-by-smbs-27186/

 

[2] Americans Now Spend More Time on Facebook Than They Do on Their Pets. 2014. Retrieved from http://www.businessweek.com/articles/2014-07-23/heres-how-much-time-people-spend-on-facebook-daily

 

[3] Reid, Jason. Small Business Survival Guide. Course Technology / Cengage Learning. p 22

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