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  • Where should you put your advertising budget?

    Aug 21, 2013 by Alan J. Goldstein | No Comments Yet

    Once upon a time, life was simple. Depending on your business and your customers, you had several publications where you could advertise. Postal direct mail also offered a cost effective solution, and it was particularly effective for lead generation. Occasionally, someone would use a card deck or an insert, and that was considered pretty exotic.

    When our company was founded in the late 1980’s, we were primarily a marketing and lead generation company, and we were able to work miracles for most of our clients with these tools alone.

    Today, marketing and lead generation is much more complicated

    In today’s world, the choices are far more plentiful, and much more complex. Most customers look for products and services on-line, but some of them still use big yellow books. At a minimum, you have to pay twice to cover your markets. In addition, the choices are much more fragmented. The same advertisers that used the yellow pages now have to choose from several yellow page directories, just to cover the 20% of their customers who use yellow pages. Most directory publishers also offer on-line options, and there are text ads on Google, Yahoo and Bing, and numerous local on-line directories. There are search optimization offerings to help with native search results, on-line display ads everywhere, and twitter, Facebook, YouTube and other social media.

    It’s easy to get distracted and confused among all these choices, and it’s even easier to spend quite a bit of money on advertising that draws few customers, or the wrong ones.

    Getting back to advertising basics

    Many advisers in this brave new world of advertising are young people with a technical background, as they are most familiar with the on-line world. Some are very bright, and will do an excellent job on the mechanics. But what is often lacking is an understanding of the mindset and motivation of the customer. It’s nice to be tuned in to the latest social media, but that will never substitute for understanding your target audience, your product or service, and how the two relate.

    Defining your audience

    The first step in any advertising program is to define your marketing strategy and your target audience. Who is a prospect, who is not? What factors define the former, how many are there, and how can you reach them?

    For some marketers, the answer is simple. It might be all consumers in the five boroughs of New York City, all parents with teenagers in the northeast, or fly fishermen. For business-to-business sales, it might be all companies in a certain size range, firms in a certain industry, or all individuals with a certain title (such as controller or human resources director) across industries. In other cases, your prospects may be more difficult to isolate, such as industrial users of electric motors.

    Once you have defined your audience, the next step is to guesstimate how many prospects there are, since it is almost impossible to plan a marketing program without this information (or to even decide if you should be going after that market). While the art and science of estimating market size is beyond the scope of this article, it may involve using data from the US Census Bureau (for either consumers or businesses), as well as private sources such as circulation figures for relevant publications and membership figures for trade associations or other organizations.

    Engaging the audience

    Once you understand the size and composition of your target markets, you can decide how to reach your prospects, and how to engage them. This is the where you select your media mix, and it is the point where many new media marketers start their efforts. Clearly, you can spend too much on the wrong media unless you have done your homework on the earlier steps.

    Each advertising vehicle comes with its own set of rules for engaging your audience, motivating them, and gently moving them towards the desired result. For larger or long term sales, a combination of methods may work best, since you may have to move prospects through a series of steps from early stage until final close.

    Matching media to the sales cycle

    If you choose to engage early stage prospects (not every business does), you may want to consider media that are less focused on direct sales. For example, you can invest in sponsorships, participate in meetings and conferences and employ search engine optimization (SEO), with follow-up through social media and blogs. For later stage prospects, you might consider on-line display ads, pay-per-click search advertising and the like.

    Selecting the right media mix then comes down to matching the audience (which you hopefully defined first) to the available advertising vehicles, and allocating your overall budget between categories and individual media within each category.

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