Marketing Advertising does not need to provide a new generation of entrepreneurs the necessary theoretical foundation for developing a low-cost marketing plan does not rely on advertising. However, this is not just a book on business philosophy, but also includes full detailed suggestions on how to incorporate an effective marketing plan, from instructions on how to build corporate image, determine pricing, employee relations and provider, accessibility, open business operations, customer support to many other topics ...
"Spend too much money on advertising is admitted defeat. I would rather invest in these factors creates loyalty to boost purchases than throwing millions of dollars on a Super Bowl ad. "
Ward Hanson, author of "The principles of marketing through the Internet"
Marketing means running a first class business and let people know about it. All actions of the company you are shown a marketing message. The construction business image is not the product of a public relations firm, which is a reflection of what you do and how you perform that job.
A second ad is smart to go into people's minds. The truth is, most of us know very little about advertising and general understanding of marketing. Are experts at marketing your business, we are aware of it than anyone else.
You may be surprised to know there are many successful small businesses discover that they do not need advertising to become prosperous. Of course, most small businesses - more than 2 / 3 in the United States - has flourishes without advertising.
We clearly distinguish between "advertising" - a form of broadcast your message to multiple components for which no salt in the community, with "listing" - form to bring your message directly with the special interest, favorite product or service, such as the Yellow Pages.
Here are the numbers of specific evidence on small business and advertising terms: There are about 20 million businesses operating in non-agricultural sector in the United States. Of these, approximately 2 million businesses operating in the construction field; 5 million other business enterprises in wholesale, manufacturing, transportation or mining. In particular, businesses with customers through advertising accounts for only minority (only 30%). The rest rely on the ability to understand customers, reputation and sometimes by sales staff or representatives of their trustees. Of the 13 million remaining enterprises, 70% are operated by individuals. And the venture investors themselves rarely appreciate the benefits of advertising, also by an individual business operator, whether owned by a lawyer, doctor, or IT consultant close as entirely dependent on personal referrals. Thus, the number of enterprises can be considered useful only advertising is just under 19%. We believe that most businesses do not need advertising.
There are four main reasons ads are not proved suitable for small business:
Ads are not profitable. The ad claims that even creates profit margin is often wrong.
These customers were attracted by ads are not loyal. In other words, advertising does not create a solid customer base for business activities in the future.
Reliance on advertising to push the business into jeopardy when changing tastes of customers and erratic so many businesses at risk of failure.
Because of an ad's performance is impressive hoax, the person advertising the public is increasingly seen as dishonest and not attractive (in a conscious and unconscious). The headline business often suspected of providing goods and poor service quality.
Now, we consider these reasons more in detail.
Myths about the effectiveness of advertising
Rhetoric advocated by those ads almost silly making a pitiful: If you can appreciate the benefits of advertising for your business, the advertising is effective, but if you do not to assess the beneficial effects of advertising, the assessment tools are not sufficient to convince. Or you need more advertising. Or you need a different type of advertising. This argument has many similarities to the allegations was the only reason people still advocated as the ad claims: do it yourself rich by visualizing yourself flourishes. If getting rich right away, you must completely beholden to advertisers (and perhaps you should reward your mentor helps you imagine that at least 10% commission). If six months have passed and still bears shock and shoulders, then you have imagine something wrong. It makes us remember a man in Chicago, who placed the statue of marble lions in front of house to ward off floods with: "Magic is not," he shouted cheerfully, "I do not see children array with sharp dared come here at all. "
James B. Twichell, author of Adcult wrote "Whether there is evidence showing the inability of the ads, the simple truth is you can not count the close relationship between the turnover increased with increasing ad. If you can, the advertising company will charge customers by the sales increases, not by ad space they buy. "
Paradoxically, although some small business owners are beginning to realize that ads are not effective, but many companies still advertising. Why? There are a number of the following reasons: because of the inherent trust in their heads is effective advertising, because no other model and because bankers want to consider "advertising expenses" are part of the problem business.
It is important to be aware of your evaluation of the ad can be seriously misleading. Your ad has been surrounded in every corner of life and you've heard countless times that the ad is effective. To view the ad in an objective, you may need to reconsider some of the inherent faith.
Since 1976, advertising budgets have doubled every decade and grew 50% in the past 10 years. "Currently, companies spent about 162 billion dollars each year to 'spread the bombs' in our print and radio ads, so spend around 623 USD for every man, woman and child in the United States "(article" The madness of marketing "by Laurie Ann Mazur is the Journal of E, and 6 in May of 1996). Information Resources Company, a global marketing resources (www.infores.com) has studied the effects of advertising and concluded: "There's no correlation between advertising and higher sales. The relationship between advertising and sales growth is more superficial. " Or as George Orwell said, "Advertising is brandishing sticks clack sound inside a tank of water, wash the rice."
To illustrate the degree of spread of belief systems "effective advertising", consider if the sales of a particular product will fall, most people will find every possible explanation - without even paying attention to the fact that it may be the result of counter-advertising.
The followers of skepticism will assert that you absolutely can not sell a certain consumer items - such as beer - which is no simple series of ads on television constantly. We introduce them to the brewing company Anchor Steam in San Francisco, in 1995, the company has sold 103,000 barrels of premium beers and substantial profit without any ad campaign . They believe in slow and sustainable growth as well as maintaining a loyal customer base, satisfied with their product. (See Chapter 12 for details on how they do.)
2006, Cosco, a discount store was set up as continuous miracle surpassed Wal-Mart and Sam's Club thanks to our business motto low cost - of course not including the advertising.
Even apparent successes may not like what we see. Advisory Council for California raisins (The California Raisin Advisory Board) has launched an advertising campaign resonates in the history of advertising. In the mid-'80s, the advertising company of this Council, Foote Cone and Belding, first launched the campaign "clay animation" national stature. Annual budget for this program more than $ 40 million. Dried grapes dance and song, "I heard the song on the vine branches" to create a common image to the extent that sales of dolls, other toys, drinking cups and other products brought nearly $ 200 million in revenue and there is even a television show for children broadcast on Saturday with currant character. In the first two years of the campaign, sales of raisins increases mainly because the marketing people to eat cereal too impressed with the popularity of this campaign that they increase the amount of raisins in cereals and participate in ad campaigns.
After 4 years, dancing raisins campaign stop functioning. Revenue slipped less than before the campaign started (Forbes, 17/06/1996). By the early '90s, Advisory Council of California raisins has been dissolved.
Internet and World Wide Web has created for us a new way to test the effectiveness of advertising. Billions of dollars have been poured into advertising before the Internet was born, but no landline advertisers can create online ad impression. Even Toys "R" U.S., a leading toy retailer behind eToys America has the level of brand identity online even though Toys "R" U.S. has a history of 25 years while only founded eToys is 2 years. Decades past continuous advertising of Toys "R" Us did not mean what reason (Industry Standard magazine, issued on 20 March 2000). eBay - one of the most successful models on the Internet also did not use any form of advertising.
Craigslist is a successful model for how community-based operations headquartered in San Francisco. Very convenient, online advertising boards to accept the traditional forms of advertising on virtually everything, from work to home, football tickets to electronics. Highlights of Craiglist is that it allows users to post up a myriad of ads completely free of charge - just the job ads posted on the three major U.S. cities are being charged. It is a simple website, not fussy and not advertising.
Ten years ago, Craig Newmark started up this site for the sole purpose to inform people of events happening in the Bay Area. But now Craigslist has sites in 65 U.S. cities and received positive feedback from users, in addition it also has sites in Toronto, Paris, Belgium, Tokyo, Sydney and is looking to to expand in the future.
Consumer Reports, an online magazine readers with a large number of very successful operation with no ads posted. By business model is not advertising, Consumer Reports has maintained a high fidelity with respect true image in the eyes of readers, those who uphold the objective information of this journal.
New York Times, March 22, 2000 made comments "Unlike newspapers provide consulting services and online, Consumer Reports accepts no advertising, no fee to introduce a specific commodity consumers, and also does not provide and sell their data as a market research for companies that their products are in the proven. "
Consumer Reports also has a list of companies committed to ensuring honesty and objectivity of the site. This is their evaluation about 300 companies are ranked higher: "The companies and websites in this list ... have agreed to follow our guidelines to enhance his own prestige. They are aware that if not honest, you'll never go back a second time. Therefore, we will continue efforts to further develop this list, to build a destination site safe, reliable consumers everywhere. "
To a certain extent, advertising will become an addiction: once you're addicted, it is hard to stop.
You become accustomed to a fee fixed ads on your budget, and you do not dare stop because of an unfounded fear is a source of new customers will be dried up and their investments poured into previously advertising will become "the cup" if stopped.
To examine the effectiveness of the advertising blitz by a local computer services in a subsidiary, the company made its largest aircraft conducted a survey to find out how stars 100 guests Most of the company's new found computer services mentioned above.
Results: 13% of these customers find the service through advertising campaigns, 23% come from the calls offers, 56% were registered by other customers and industry experts to introduce, 8% do not know for sure why they choose the services that computer.
This is truly a complete survey results dissemination. However, as we can see from the huge advertising budgets of them, very few companies to act based on the above information. If so, they must be spent to boost the budget for the introduction of individual activities. Indeed, some businesses did not seem to trust what market research showed that the introduction of very effective personal ad is no longer that they poured money into advertising is just salt away tank.
Google is one of the most successful companies in history. Founded by two students with money borrowed from credit cards and so developed gradually, just 3 years, the company has earned high profits. And after 5 years, the company's value has reached 50 billion, with nearly 2,000 employees.
Google search for the origin of their very simple, plain white and of course, is free advertising. But Google does not allow ads (like the banner on Yahoo) that only sell "listing" and is independent of the listing of search results so it will not affect them. This policy almost never appeared in magazines, television and newspapers.
Not only big companies, the new national stature to be disappointed with effective advertising. The retail shops in the locality when implementing programs with coupons to evaluate the performance of their ads also show that sales revenue is not even enough to cover the cost for advertising.
However, proponents did not stop ads to persuade small business owners that:
• The ads can be improved, please continue to try to (chorus forever).
• All those who see the ad but do not cut coupons to know your business and can use it in the future. Please continue advertising (chorus forever).
• The effect of cumulative advertising. Must maintain certain ads (chorus forever).
But the long-term beneficial effects of continuous advertising is what? But what other ideas constantly remind the public that you exist? Dr. Julian L. Simon of the University of Illinois said that there is nothing "real myth is very bizarre when the effects and the income threshold increases as a result of repetitive advertising, but there are myths firmly established that almost nothing can shake it. "
Using radio ads to promote the common enterprise for the opposite effect desired; a business is hype everywhere are vulnerable before the attack from the public.
Coors Brewery taken as an example. 30 years ago, after the plant has expanded its original territory and became a famous units across the country with a huge advertising costs (100 million dollars each year in the 80s), then Union Teamsters Union launched a consumer boycott is effective against this plant.
In the 90s, in the town of Seattle, where the trade union movement developed, the market share of less than 5% Coors. Coors Brewery of the '60s - the key is known by loyal customers in the Rocky Mountain states, with 30% market share of beverages are less affected than boycott it.
Another example is the securities brokerage firm E. F. Hutton - the unit has spent several million dollars to create a false image ad: "When EF Hutton said, people listen. " Notably, this picture brought back with the results expected when Hutton was caught participating in many cases currency trading illegal large scale.
There are many stories surrounding the victim who "really listen when EF Hutton said, "to contribute to the company quickly collapsed, and eventually it was a different brokerage firm to take over with dirt cheap prices. Similarly, agro-processing companies, but few big names with Archer Daniels Midland is headquartered in rural Illinois have turned themselves into a famous brand committed by the public television program . And the public has become so familiar with "ADM, Supermarket of the world," at a time when this company was involved in a scandal settlement price of $ 100 million and pay a fine.
Becoming a well-known brand has certain disadvantages. Martha Stewart, queen of the business of beauty products home, the woman moved from the empty hands has turned himself into a farce, and the business empire of her when she was stung by allegations of fraud in stock trading.
Omnimedia shares (which owns Martha Stewart brand) have fallen dramatically from 20 per share to 5USD/co votes after the allegations against her to appear publicly and stock losses in the third quarter is 1 billion. It took over three years and until Martha was released, the stock price return to a glorious start.
Lessons learned from the very simple story. If these companies are less dependent on advertising than the issues they were less exposed than the galaxy's front desk.
Sadly, many small businesses risked "blindly pushing" when spending a lot of money for ads that never guaranteed to be effective. Sometimes, this means that the quality of products or services of the business is reduced. In addition, business owners or employees to sacrifice their own needs to pay for advertising.
We think it is best to use the money to finance a trip outside the region, bringing short family vacation or invest money in raising capital for business ownership. John Wanamaker, merchant and philanthropist description of two centuries: "Half the money I use for advertising is wasted, and the problem is I do not know half of what it is."
RECYCLING OF PERMITS: MEDIA SERVICES Tribune
Why customers are attracted by advertising often disloyal?
Perhaps the worst aspect of the ad that anyone while operating a retail store all by heart is the first customer to respond ad guys usually go fast sexy clothes. The magazine and publishing company too dependent on the client with spam bait fishing for sale must also taste the "bitter fruit" similar.
The truth is that new customers have been using techniques such as ad type shotguns TV spot, newspaper ads, direct mail, contests and sales via telephone requests are rarely returned. These fraudulent Internet businesses like DoubleClick steal your personal information and then sell your email address for the other units are only those who harass you with a marketing strategy called "target" based on the Web sites you visit and amounts of your online shopping only.
For example illustrates the phenomenon that almost business owners provide a little too familiar case of Laura Peck. She wrote to us that she would advertise the seminar to introduce their products, but due to financial problems so she has stopped advertising. Instead, she began to nurture relationships of their friends and become familiar with customers.
Two years later, the business prospered, and she said: "When advertising, it seems I only attract customers because the discount program. These customers often do not come back, they cancel the meeting and the majority do not participate in next time. The most enthusiastic, loyal, and not miss any meetings are almost always presented directly. If not for the economic issues involved, maybe I did not learn this important lesson: personal referral is the most effective advertising available. "
Why depend on advertising have harmful
To a certain extent, advertising will become an addiction: once you're addicted, it is hard to stop. You become accustomed to a fee fixed ads on your budget, and you do not dare stop because of an unfounded fear is a source of new customers will be dried up and their investments poured into previously advertising will become "the cup" if stopped lai.Tat course, there are rare occasions when a particular ad can generate significant business performance.
In small business, this probability is also lower as catch a salmon weighing 30 pounds from a boat or recreational won $ 100,000 at casinos. The story of the great success of advertising (odd hobby "hard rock" 10 years ago as an example) became popular in the community and posted on the magazine trade.
As a result, many entrepreneurs lack the experience that dirt had to spend money on advertising. People have forgotten the extremely low probability of success of this type as well as the consequences often happen to people who bring their advertising profits ahead. Successful advertising can bring swift flow of the original customers that your business may be ready to receive it.
This often leads to two bad consequences: many long-term customer loyalty removed when service quality declined because their businesses have gong orchestra thin force to meet demand, and most new customers will not return to the website.
Mary Palmer, a photographer in San Jose, California, started the business with a marketing strategy is simple but traditional advertising categories "wedding" by local newspapers. Palmer is one of the first people in the cage for the wedding ad. She was extremely happy to collect about $ 12,000 in the first wedding season lasts from April to August.
The following year, her ads, but this type of advertising that was so popular. No ads are not effective, but the relationship is doing the customer service she had introduced last year and less. Feeling anxious, Palmer has called us to ask for business advice urgently.
To visit her, we see that her store is very poorly organized and generally is quite messy. The overall impression of the effect of her photography is that it's too bad. It is understandable why there are so few customers Palmer introduced her friend, or themselves had to place her in different occasions. Palmer is a victim of the lightning success of the ad itself.
The cult of "effective advertising" was to lull her mistaken belief that she really did not need to learn how to run a quality business. We can not give her much advice except to suggest that she should start from scratch, using all the techniques of business and personal introduction methods.
Palmer's business completely opposed to a merchant Gail Woodridge also specializes in wedding photography. Woodridge has not conducted any active ads in the traditional way, although she has posted many of their services in many places to attract customers.
Her customers are mostly people who organize weddings, flower shops and wedding dress, friends and former clients who know and believe in the quality of her work introduced. With this approach, the development of her business is slow, so she has time and knowledge to ensure that multiple arrays in the enterprise are arranged orderly, including office work and finances, as well such as photographic equipment, dark room and filing system.
These ad units: the bad companions
According to a survey of recent consumption expenditure, expenditure of households is 4,000 billion per year. Estimated cost of newspaper ads, flyers, radio, online and TV to seize a portion of this market is about 236 billion dollars. This result should make us shudder. It also said that every American into contact with over 5,000 advertising messages every day, and children see over 50,000 commercials on television each year.
In our view, there are a quarter of these ads are deliberate hoax. Gradually, the business being advertised is not the type you should be proud to communicate and do business.
Are you skeptical statements "most dishonest ads are our" or not? Let's make a small test. Please look through the local newspaper where you are just like we did on a recent morning. Here are a few pieces of advertisement that we see:
A post ads for a weight loss center promised its customers that they will reduce the 5, 10 or 20 pounds a week for clients. The fact that some people can only be a part reduction of the number of excess pounds, but how many of them could abstain for more than 3 months? In his book titled "The Honest truth about weight loss and diet," Joan Price has revealed that 90% of dieters gain back within a year.
She explains, "Excuse you, there is no magic way to prevent burning, massage, mild shock, or get the fat melt from your body. Do not have a pill, injections, creams or dose of magic at all.
If so, we will not be posted on the front page of all newspapers and medical journals rather than buried in an ad or what? "Of course, not anywhere in the article refers to advertising permanent weight loss because although the method used in any way we can not bring long-term effects. If ads told the truth, no one will use all their services.
A magnification ads have been tricked my friend bought his son a toy car remote control on the occasion of Christmas. This toy cars have been launched. The friends innocently fell in the line of my people crowded at the counter and imagine the faces of children cheering her on Christmas morning.
In advertising not clear that these cars need a special battery pack can be recharged and returned to the store when a week before the big holiday, I was informed that your batteries were sold and must be wait until Christmas next year. They return to stores this week to a week off it, finally, two months after Christmas, the battery is in the shop. Excessive, rather than a car charger for toys cost 50 USD to 20 USD.
N A ad offering a private home security devices with very cheap price in the text to appear like a card to protect your family makes you feel impressive until you read the fine print section. In tiny letters, the ad explained that the $ 99 covers only the installation of standard and should be accompanied by a 36-month monitoring agreement. In addition, customers must pay to connect your phone.
Airlines in the United States?
In an article published in The Wall Street Journal (Wall Street Journal) in 2006, Scott Mc Cartney message "Earlier this summer, Delta issued a statement" We are extremely proud to be rated as major airlines Most United States. 'In a report published on 8 June, carrier aviation is the Atlanta announced that they have "some flights to the cities in the United States more than any other airline. "
But according to McCartney, flight number and destination is never included in the criteria ranking scale airlines, like the classification unit based on the number of retail outlets rather than sales or computer score the baseball game with some kick the ball instead of eating up golf so many times. Methods for determining the scale airline standards are based on the length of the itinerary and the revenues per passenger mile. Delta ranked third only considering this criterion.
Whether you look at a newspaper, magazines or electronic media, could not have been more truthful advertising. Even if your ad absolutely honest, your ad has a bad reputation. The public has long had become skeptical about the overall level of honesty in advertising, will not believe what you say on face value.
For example, suppose you own a restaurant, and instead praised the excellent menu in an exaggerated praise, simply stating that you serve "scrumptious food with reasonable prices ". Many people have become cynical after a lifetime being duped by the rhetoric claims, so it can be concluded that the restaurant's food can not be good so if that's all you can say about it.
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