E-mail is a Powerful Business Tool

email 78542920It’s hard to learn about e-mail marketing, because if you Google it you get bombarded with ads or links to service providers trying to sell you their solution rather than solid information about e-mail marketing. The first question, of course, is: Are you using e-mail marketing at all, and if so to what degree?

The second question is: How do you know when you’ve outgrown the basic providers from Microsoft Outlook to Hotmail, Gmail, iCloud or even Yahoo? Most of these services are meant for one ups, meaning they were designed for individual not business use.  If you’re really doing e-mail marketing – meaning sending regular messages to more than 25 people at a time – it’s likely time to upgrade to a business service. Why 25?  This magic number is a trigger for many spam filters. There are many definitions of spam, but one clue filters look for in determining if a message may be spam is the sheer number of addresses being targeted.

When it comes to business providers, the best known name is Constant Contact, due to great marketing investments, and personal representative franchise attendance at local business shows. But, it’s not the only solution. There are alternatives, most notably Mail Chimp. Consider this post comparing the two providers. Choosing an e-mail provider is no different than choosing any other type of service provider. You need know how you intend to use the service, how many people you need to communicate with at a time, and then judge the service providers based on price and how they serve your communication needs.

How do you intend to use e-mail? Are you sending out an e-mail on a regular basis, and to how many people? Are youjust sending out a group text e-mail on a seasonal basis, or only when you have a special sale or gained valuable publicity in a local newspaper? Are you sending links to your web site, or sending customer surveys?

E-mail continues to be one of the most powerful communication tools in a marketing arsenal, but as with all ads and communications channels, it should be done by plan and with knowledge not only about state regulations, but with intent to strategically grow your business.

Due to spam regulations it’s not OK to send your message to another company’s list. But small companies also find it hard to build a list of any scale. It’s the reason they frequently try to send their messages to another company’s list or buy a list. Both tactics teeter on the edge of getting your company known as  a spammer because unless you have relationship with the recipient or their permission to hear from you specifically, you are not using e-mail correctly or effectively. Instead, find a way to create a partnership, either by sponsoring  an e-newsletter, or advertising on one that is going to your intended audience.  That’s not spam, but alignment.

The Walk-Away: E-mail is a powerful business communication tool, but only if used wisely. When used aggressively, a good service provider is needed, but which service provider is right for you depends on your strategy and budget.

When Ads Aren’t Advertising

Not an adSome advertising isn’t advertising at all. It just takes advertising space and usually precious advertising dollars to achieve a different company purpose.

Consider these examples where ad space is used to:

  • Announce a new professional or service employee
  • Announce lists of employees with long service
  • Thank sponsors or volunteers for a particular event
  • Promote a preferred charitable endeavor

Each is a legitimate use of space or time, but should not come out of an advertising budget. They are not effectively advertising the business, but fulfilling a different role.

But, you might argue, “Announcing a new employee such as a famed doctor or hair dresser is advertising how our business has captured a great new talent and it will drive traffic to our business from those who follow this person.”  True to a degree, but it’s also likely true that the talent came with a “book” of their own and have already emailed and called regulars to announce their new location. More often, this type of ad is used as an ego-soother, just to make the new employee happy, and even might have been part of a negotiated package to bring them to a business from a competitor.

The same could be said of the next two bullets.  The ads are goodwill to employees, volunteers and sponsors.  A personal thank you note or gift may have worked as well and even been less expensive.

The last bullet is a charitable donation not an ad spend.  It’s a legitimate way to help a cause or organization gain recognition that it cannot afford on its own.  In this case, the ad should be written to promote something about the charity so that the ad works hardest for the cause being promoted. Then the ad is an ad, but not for the business paying the bill. For that business, the charge should be seen on the books as a valued, and likely non-deductible charitable donation unless the donation is given to the charity directly to purchase the ad space on their own. Many charities welcome and desire this type of donation over cash, because it improves their own effectiveness to  raise donations, or encourage volunteers from others.

Dollars for these types of ads should, ideally, come out of marketing budgets, HR budgets, or community service budgets for larger companies. For smaller companies, they should also be allocated to a non-advertising line to be accounted for accordingly and not skew the company’s review of its own ad effectiveness at year’s end.

Last, but not least is image advertising. Large companies know not to look for an ROI in dollars with image advertising because it’s not the purpose of the ads.  Instead, they might measure awareness effectiveness. The lesson in this is that not all ads are equal. Don’t judge them all the same way or look for the same metrics in reviewing their effectiveness as each serves a distinctly different purpose.

 The Walk-Away:  Advertising is a serious and not inexpensive endeavor. If using advertising space for reasons other than directly advertising a business, don’t allocate the dollars from your advertising budget.  Spend them from lines that allow you to see what you did during the year in an honest way, and allow you to measure true advertising results accurately.

Print Ads Used in Phenemy Positioning War

It started at the Consumer Electronics Show at the beginning of 2013, then moved to a full page ad in major nationphone legsal papers, only to be countered in the same papers soon thereafter.  What is it?  The newest phone ad wars between AT&T and T-Mobile!

Newspapers love ad wars almost as much as oil companies like price wars, and divorce lawyers like contentious divorces.  But, besides bringing in unexpected ad revenue, there are lessons to be learned from these phenemy (phone enemy) ad campaigns and not all of them are positive.

Companies have two basic ways to get their side of the story out — PR and advertising.  Effective PRcan get company spokespeople on pundit talk shows and inches in commentary sections of newspapers. If done really well, it can get the company quoted in an actual news article. But there are never any guarantees with PR.  On the other, Advertising does guarantee placements. It’s why during strikes, elections, employee recognition periods, and even phone wars, you’ll see a proliferation of print ads, because nothing tells a story better or quicker than a full-page ad in print.

Unfortunately, it’s not clear the recent AT&T and T-mobile ad wars were effective. Here’s why.

  • The campaign was limited to national publications.
  • It was based on a conference speech that was also limited to industry insiders.
  • The company with the leadership position gave free press to the competitor.

Here’s what happened. The new CEO of T-mobile made a snide remark about AT&T. Few might have heard the comment or given it credence since AT&T has the leadership position. But, instead of letting the comment slide, AT&T came out fighting with limited national ads. Most people never saw the ads, but others started talking about it as it hit the trades. In essence, AT&T gave a broader voice to the initial T-mobile argument.

The AT&T ads could have worked if they had been more widespread, but the creative also gave unnecessary ink to T-mobile. The AT&T ads claimed T-mobile had two times the dropped calls, two times the failed calls, and 50% slower download speeds. This drew added attention to the ongoing complaint about AT&Ts own dropped calls rather than playing to its strengths.

As noted in the now classic marketing text “Positioning The Battle for Your Mind” by Al Ries and Jack Trout, “At almost every step of the way, the leading brand has the advantage.”  By responding to the T-mobile posturing, AT&T gave up some of that advantage and opened minds to the possibility that T-mobile may be right. Or, as T-mobile’s CMO Mike Sievert said to Advertising Age, “AT&T doth protest too much.”

broken legCheck out the AT&T and T-mobile ads and judge for yourself.  Then, take a step back and think how the full page ad space could have been used more effectively, because a full page is a terrible thing to waste.

The Walk-Away:  Advertising should never be done defensively or off your main message because instead of giving a campaign legs, it creates confusion.  It’s more like trying to run on a broken leg. All you get is more injured.

Advertising Extends Seasonal Sales Cycles

Being in a seasonal business can mean one of three things:

  1. Your business is seasonal catering to a defined seasonal market. Summer amusement parks fall into this category.
  2. Your business is located in a seasonal market, but isn’t generally considered seasonal. Grocery stores that cater to local residents, but see an increase in sales during tourism seasons share this category.
  3. Your industry is considered seasonal.  Many retail businesses fall into this segment, with high holiday and back-to-school selling seasons.

carlegsRegardless of your category, great marketing helps you either broaden your season length, or create additional seasons. For instance, some category 1 B&Bs previously known only as for summer destinations have successfully positioned themselves as off-season resorts in addition to their regular high season. By advertising these new selling propositions to both standard clientele and new customers looking for different or more cost-effective vacation experiences, these B&Bs have effectively created a second sales season that didn’t exist several years ago.

When in a category 3 business with a seasonal selling cycle, it’s important to stay abreast of ever-changing consumer trends to ensure that what has traditionally been your key selling season hasn’t changed the game. The auto industry is a great example of how consumer shopping patterns have shifted just within a two-year time period.

Take a look at the table below from the US Census, which tracks retail sales by category every year. In 2010, two years after the recession hit high gear, auto sales by auto dealers were highest in December as consumers waited for late year models to go on sale.

Percentage of Auto Sales by Auto Dealers in 2010

Jan Feb Mar Apr May Jun
7.3%
7.2%
8.4%
8.3%
8.5%
8.4%
Jul Aug Sep Oct Nov Dec
8.4%
8.5%
8.1%
8.3%
8.6%
10.2%

Sales in December were 2-3 points higher than any other time of the year with January and February being the off season. Traditional car advertising followed this pattern, tending to run heavier during the holiday seasons and staying low during the early winter months.

But, buying patterns have changed and if a car dealer today is still buying advertising based on the 2010 model, they would be missing a significant amount of  2012 buyers, who are far more consistent in buying cars throughout the year. Check out the buying patterns for 2012 below.

Percentage of Auto Sales by Auto Dealers in 2012

Jan Feb Mar Apr May Jun
8.0%
8.2%
8.2%
8.2%
8.2%
8.2%
Jul Aug Sep Oct Nov Dec
8.2%
8.4%
8.6%
8.4%
8.7%
8.8%

This new data set shows that consumers are actively buying cars all year long with December still being a key buying month, but no one group of months being significantly different from the others. What was once a semi-seasonal business has evened out.

What this means is advertisers not adjusting their media plans to attract consumers all year long are missing those consumers who are actively in the market at any point in time. The data is available from the government for most key industrial codes.

The Walk-away: Assumptions made about key selling times of the year can cause businesses to unnecessarily miss key selling opportunities. The recent past is not always a good indication of current or future buying trends.

SOURCE: Monthly Retail and Food Service Sales, 2012 Sales, census data, http://www.census.gov/retail/mrts/www/data/excel/mrtssales92-present.xls

Real Estate Study Shows What Advertising Works

In real estate advertising, a recent study shows that print and digital ads are a powerful combination. Seeking to determine effects of both print and digital advertising on effectively selling a home, the study found:

Homes for sale that are advertised in both print and online are 20% more likely to be sold than those that use just one medium.

Furthermore, the study showed that “properties that used a combination of both print and online advertising had lower discount levels and spent less time on the market.” The study, considered the first of its kind,  was conducted by News Limited, the majority owner owelcome matf Australia’s website realestate.com.au,  to determine what marketing worked in moving more than a half million properties within a 12 month period.

Previously, realtors swapped information on what they thought worked or didn’t in advertising campaigns, but the field was sorely lacking in valid statistical data. The industry in the U.S. is great at tracking metrics on homes for sale, homes listed, and prices achieved, but has a lack of information on what fosters the sale. The Australian study starts to shed light on advertising effectiveness that can be insightful not only for American realtors, but other small to medium-sized retail operations in the U.S, namely:

  • Inventory that sells fast tends to not to have to be discounted.
  • Using a combination of print and digital advertising increases exposure for items you have to sell.
  • The added exposure can increase your advertising return by up to 20%.

The Walk-away: When creating your media plan to sell inventory, don’t just think of one medium. Print and digital are a strong combination. Because of their strong local reach, the print/digital combo should be the foundation of any local advertising program, with other medium added for effect.