Profitmaker: Planning Your Advertising

Advertising isn't optional for the growing video business--it's a must. Here's how to plan an effective ad strategy.

Advertising is vital to the success of your video business, be it large or small. The success of your advertising, on the other hand, depends a great deal on where you advertise. You'll spend most of your advertising money on space or time in the media you select--that's why the creation of an ad plan is so important.

In forming an ad plan, you'll often find that the competition for your ad dollar is not within a specific medium. For example, the decision may not be which newspaper to use or which radio station to program; the choice will more likely have you deciding between newspaper or radio. So before you even start envisioning your ad appearing in the morning paper, ask yourself three questions.

1. To whom do I want to advertise? Determine who are the people that can use and benefit from your services.

2. Where are these people? Think about the geographic area from which you can do business. Also consider potential customers' places of employment.

3. What kind of advertising message do I want to deliver? Decide if a hard-hitting ad or a soft-sell image commercial will represent you best. Is print, TV or radio the best conveyor of your message?

When mulling over your choices for ad placement, keep in mind that each medium has its own specific characteristics. Newspapers are good for reaching a limited geographical area, people of both sexes and all ages, of different income and educational levels with varied interests. Radio and local cable television call upon a more segmented audience, with different stations appealing to different markets.

The print media offer the advertiser more leeway with the length of the message, yet limit exposure to the frequency of the publication. For example, a daily newspaper is only printed that often, daily. You cannot increase the frequency of your ad to more than once a day. In radio and television, commercials have practical length limits, but can appear at almost any frequency. You can hypothetically buy airtime once every 15 minutes, if your budget allows it.

While in general, certain media seem to be the logical channel of communication for certain types of business, it's important for the advertiser to keep his thinking open-minded and flexible. New generations of buyers develop new reading, watching and listening habits--usually different from those of the preceding generation. This means your selection of media may have to change as well. What may have worked in the past may not work today. Explore all of the options today's modern communication systems make available.

Some Caveats
You might be under the assumption that you already know enough about the media available to you. If you are a local advertiser, you probably read the local paper and listen and watch local stations. But there is always the danger that your personal preferences will influence your advertising decisions. What you like best may not be the best choice in reaching those to whom you need to sell. Big band music may drive you crazy, but if you want to sell reunion and golden anniversary video packages to seniors, you cannot let your dislikes enter into your decision about what programs to use in your radio advertising. The same goes with television and print. Just because you are not a fan of specific programming, doesn't mean your target audience hates it as well.

Also, don't rely too much on whatever information media representatives offer. Question them in detail about their publication or station. Ask definite questions about the audience's size, sex, age, income levels, interests and home ownership. Be sure to get, in writing, all costs for airtime, space and production. So-called "hidden" costs such as the station or newspapers' charge for creating the ad for you is just as important as what it will take to get the ad to the public. Large buyers regularly ask for such data, but even with a small ad budget you can expect just as much information.

Finding Information
If you are considering advertising in newspapers, local or regional magazines or some other print medium, ask reps for circulation statements. This will show you the total number of people who receive copies of the publication and where they live. Business oriented publications and trade journals will usually furnish readership breakdowns by industries and job titles as well. Circulation statements may or may not be audited by an outside organization. While most media outlets are generally honest, audited statements eliminate the chance of exaggeration or false information.

Auditing organizations measure broadcast audiences differently than those for the print media. Private research companies use a variety of information collection methods to gather audience statistics for radio and television stations and programs. While there is no one standard, each technique uses a sampling method of the households or individuals within the broadcast outlets' reach. They then derive final numbers and data on the audience as a whole based on the small sample. Most TV and radio stations can provide audience size, percentage that is listening or watching at any one time, as well as sex, age and other demographic characteristics.

Using the Information
When checking out print, radio and TV audience information, the reports may appear very confusing. But the media representatives will help you interpret the data. The important point is to know the data is available and to use it in making any advertising decisions.

A good plan is to initially limit yourself to one or two media. You don't want to run the risk of spreading yourself too thin, which can happy easily with a small ad budget. Advertising through one or two outlets with a high frequency is a much more efficient plan than "shotgunning" yourself with every print, radio and TV avenue available.

While the media choice may govern the frequency of your advertising (monthly magazine, daily newspaper), the continuity is always under your control. By regularly publicizing your business in a publication or on the radio, potential customers will receive continuous exposure to your message. Businesses may concentrate their ads on certain days of the week in a daily newspaper because of noted consumer buying habits. This maintains continuity because the advertisements appear regularly every week.

Create a Budget
Selecting the media is only the first step in planning your advertising program. Next, create a year's schedule. If business conditions change, you can always make revisions. But it is good to have a guide to start with. Your schedule should show each medium you have decided to use, the dates on which you intend advertising to appear and the cost for the planned schedule.

Seeing the cost of an ad schedule usually leads most business owners to the question, "Can I afford to spend that much on advertising?" You can usually figure out how much to spend on advertising by picking one of the following five approaches.

1. All I can afford This is the easiest. Business owners using this method don't consider what advertising can or should accomplish. Instead, they look at it as a necessary evil they must deal with. Advertising is a financial, rather than marketing, decision. While this is not an effective way to create an ad budget, it does allow for some exposure, however unplanned, in the marketplace.

2. Sales percentage approach The percent-of-sales approach to advertising is the most common method. It's simple and easy to use, yet the business owner must question if the formula is right for his or her business.

   Generally, this technique uses the previous year's sales as a base upon which to calculate the ad budget. But this makes the assumption that advertising is a result of sales rather than the other way around. Also, this approach does no "forward-looking." Using last year's numbers doesn't take into account the possibility of increasing business. You may try forecast figures to overcome this problem, but then you run into the danger of basing advertising on overly optimistic expectations.

3. Match the other guys Trying to match the advertising of your competition is a defensive strategy. It focuses more on imitation rather than a careful analysis of advertising needs. Even if your business resembles the competition, your markets may be decidedly different, leading to entirely different advertising media and schedules.

4. Investing in advertising This approach considers using advertising as an investment in future profits. Usually used by new businesses or those introducing new products and services, the method looks to the future. It is somewhat risky--expenditures will exceed sales income, and you usually plow any possible profits back into advertising and other promotional activities. Eventually, income must cover costs plus this advertising. While it may happen, it is a long-term situation and this method is only for those with a lot of cash and time.

5. Objective and task A final, and most recommended manner of planning your ad dollars requires you to think about what exactly it is you expect your advertising to contribute. Do you desire more total sales, a better community image, higher sales in a specific areas or some other objective?

With the above methods, you are looking at the cost first and them dividing it up by how and when it will be spent. With the objective and task method, you first decide what your ad needs are and then determine the various costs involved.

When working with this technique, be specific in your desires. Don't just decide you need to increase sales. Instead, decide to increase sales by 10 percent. Don't just aim to bring in more customers-- aim to attract more industrial clients, for example.

Use of this method should also point to changes in your current ad plans. If your ad appears in the daily newspaper and you're seeking a new market, you may decide to direct your ad business toward different avenues promising such an audience. Maybe you place an ad in the daily paper looking for general video business--the "have camera, will shoot" jobs. If it then dawns on you that attracting wedding customers may be more profitable, your ads may appear in the weekly newsletters of all churches in your business area.

The only drawback to the objective and task method is the possibility of a business owner becoming too ambitious. When you finish your plan and total the figures, you may find the total cost prohibitive. A solution is to revise your objectives, aligning them to more realistic limits.

Finally, be sure to put any advertising plan and budget, however simple or detailed, on paper. Break it down, month-by-month, medium-by-medium, noting all the tiny details and dates that are all too easy to forget.

Other Media
Print, radio and television are not the only ways to advertise your business. There are many other reliable and effective outlets in which to place your advertising dollars.

• Direct mail: This may be the most selective and flexible of all media. It is selective because you decide who will receive your ad. You can advertise only to people who can use your service. You can confine the mailing to a small city, a neighborhood or even just several past customers who haven't done business with you lately. Direct mail is also flexible because what you send--its size, shape and "look"--is up to you. Another advantage: direct mail readers are not distracted by other advertising. Your ad stands alone in their hands.

• Directory advertising: You should include this in all business ad plans. With this technique, you reach people who already know what they want to buy. Consumers are at the point of deciding which business to frequent. The Yellow Pages are the most well-known and allow for simple name listings or more elaborate display ads.

• Outdoor advertising: Billboards and exterior signage has a high-frequency exposure because of the traveling done over the same routes by people going between their homes and businesses, stores or recreation facilities. This method is very effective near a store, where it serves as a last-minute reminder. Depending on your market area, this may be a very viable method to market your business.

• Flyers: Those pieces of paper affixed to a windshield, stuffed in door handles or passed out on a street corner are a very low-cost method of sending out an advertising message. Many companies co-op with other associated services in preparing the materials--a brake shop and nearby auto detailing center, a pizza parlor and ice cream shop, or other like combinations may share space on a flyer to reduce costs even further.

• Newsletters: Many community groups, churches, businesses and organizations print their own newsletters, providing a link to members of what's been going on. Advertising through such an avenue provides a very specialized and directed audience for your message. And the rates are very cheap!

Finally, don't forget about advertising specialties such as imprinted book matches, pens, pencils and other items. These make great return reminder impressions on current and future customers.

The medium in which you decide to advertise only promises to deliver your message to a specified audience. It sells you so much space on paper or time on the air. What you do with that space and time is up to you. The final result will depend on how well you have chosen the medium, what you offer and how you present it.