Why do my Ads Under Perform in a Recession?

Lately I hear business owners tell me that their ad campaigns under perform based on their expectations, or based on the results they received a year or two ago. I would like to discuss some of the reasons why this may be so, some of the reasons I have found to cause the problem, and how to fix the problem.

1. To begin with, if you are comparing today's expectations against results from two years ago (2008) using the same gross rating points or target rating points, and you are using the same basic offer or call to action, you probably are getting fewer responses.

Why? because in a deep recession there are fewer people in the market for most goods and services. In other words there are fewer fish in the same sized pond. So what to do? Get yourself a bigger net and cast it further into the pond. This will allow you to reach more buyers by purchasing more audience share or rating points. And why not, the rates are lower now so you can afford to buy more rating points, more reach and more frequency for the same budget you spent in 2008. It will take more fire power but there always people in the market if you can simply reach more people.

2. Check your offer lately? What you offered before may not be the same bait the fish want today. In other words, when the market is slow, consumers are looking for greater value, savings, service, warranty and guarantee protection, and overall more inducement to part with their money. Recession advertising requires that you give them more bang for their buck.

3. Get creative, and look for ways to solve problems that people are facing today. It may be creative financing, bundling of services or products to provide greater value, or creating a new service that people need to stretch their budget, create income, find a job, feel better, learn a new skill, etc.

4. Make sure you are selling what the market wants to buy. If you have a new car dealership your new car sales are down by 30-50% over 2008 based on the triple blow of the recession, tightened credit and manufacturer bankruptcies. So what to do? Focus on selling and leasing used car models at price points that people are buying and can afford to pay. Look at a buy-here-pay-here and a rent to own business model on older used cars that does not require bank financing, which fewer people can qualify for today.

Here is an example of one companies experience. In 2006 they had tremendous response to a radio campaign. So much so that they literally stopped advertising due to the residual sales and income. In 2009 the bottom fell out of the market and their sales revenue was cut in half. In January 2010 they brought me in to start advertising again, hoping to repeat the success of the campaign in 2006, of which I was not involved.

They did not get even close. Why? I asked them what was different if anything about their offer and message in 2006 vs. 2010? They could not think of anything that was different. After conducting some research into their only competitor I discovered that the competition was busy, very busy. Why? Because the competition started offering what the client company used to offer, but abandoned because of their own success.

It turns out that the client used to offer a guarantee and Saturday hours. Both of which they dropped in 2007, but because the market was so hot they did not feel the impact.

It also turns out that the competition continued to advertise in good times and bad, creating confidence, top of mind awareness, and brand preference, which consistent advertising does, while the client was in and out of the market with no consistency or continuity.

To make it more interesting, I also built a new website for them with analytics to measure traffic volume, sources and visitor patterns. What I discovered was that the radio campaign was in fact a great success. Why? Because we had nearly 1,000 unique visitors to the site in 6 weeks, 70% of whom came as a result of direct type-in or searching for the keywords we used in the radio ads. They also viewed over 3 pages and spent nearly 4 minutes each on the site, which is a long time. But fewer than 100 requested more information. This tells me they were looking for something they did not find, which is what lead me to investigate, where I found what they were looking for was no longer offered except by the competition.

So there you have it: cast a wider net, check your offer, get creative, solve problems, and give them what they want to buy.

Proven Principles Work

Effective advertising today requires adhering to proven principles:

• Always build from a well produced and researched Creative Brief. This will keep your message and creative on strategy and consistent
  
• Your ad creative and offer/copy must grab the attention of the target audience
  
• The ad must be fresh and new, unless it is part of an ongoing branding campaign. Even then, you need to freshen it up while sticking to the brand and creative standards
  
• Your offer, unique benefit and call to action must be easily understood
  
• The copy and benefit must be relevant to your audience in today's market conditions
  
• Your creative and branding must stand out from the competition and be original
• Always sell the benefits that your target audience wants, not products and features

Advertising Can Work In A Recession

I hear advertisers these days say pretty much the same thing; "My advertising just isn't generating nearly the same number of leads as it was a couple years ago."

Then they begin to doubt the viability of the mediums they are using, or the advertising message they are promoting.

And it may just be that the mediums are not right for the target audience, or that the message is off key for the market. It is my guess however that more often than not, it is simply the fact that in a down market, there are fewer people willing or able to take advantage of their offer, so the same message and media schedule is simply going to yield fewer leads.

Its just a numbers game. In good times for example, about 14% of the population will replace their vehicle with a brand new one, or a newer used one in a given year. And this is often times followed by additional spending on insurance, aftermarket upgrades, and road trips. All which stimulate the economy further.

In good times 20% of the population will move their residence. Which also statistically means that within 6 months of a move they will make major purchases on home furnishings, appliances, remodeling and home improvements. All which stimulate the economy further. And believe it or not, within the first year of a move 20-25% will also purchase a new vehicle or RV!

Without these major purchases occurring in a slower economy, it's no wonder the market is down for everything else, as the residual spin off effect is not trickling down.

Lansing Michigan for example was home to Oldsmobile, and back in the mid 1970's 25% of every working adult was directly or indirectly tied to the prosperity of and the ability to employ people at Oldsmobile. When Oldsmobile began losing market share, and jobs, the local market really suffered, because those 25% no longer had the income to buy discretionary goods and services from local merchants, which meant that their marketing efforts became less effective, causing them to buy less media, and further exasperating the local economy.

But there is hope, a lot of of it, and proof that doing the right advertising in a slow economy is not only effective, but very much the right thing to do. Explore for yourself some of the proven methods and messages that other successful advertisers have discovered.

Make Your Advertising Work

I was driving around doing errands the other day and heard a radio commercial that was so right, and yet so wrong I felt it worthy of mention.

The spot was for cosmetic dentistry, and it was well produced and written, full of unique benefits that promised the fastest and most pain-free results of any process available. It sounded like a real cutting-edge process that was affordable and would generate a lot of calls.

Great voice talent and read, compelling copy, everything you would want in an ad of this type. Except one deal killing component. The phone number was read only ONE TIME, and there was not any name or brand associated with this wonderful service, and no web address provided.

All that great copy and production and air time wasted on an ad that will not generate any business because nobody knows who the advertiser is, or how to contact them, other than a phone number given one time which nobody will remember becasue it's not even a vanity number. People can remember company names, brands and web addresses ten-times easier than a phone number, especially when that number is given only once.

How to Evaluate an Ad

When evaluating your ads for potential impact and effectiveness, consider this brief check list of effective advertising components:

• Is there an initial attention grabbing element or First Mental Image (FMI)?

• Is the copy supported by appropriate, meaningful and relevant visuals, graphics or computer graphics?
• If copy is supported by computer graphics (CG), does the CG duplicate the key copy points and words exactly?
• Is the message concise and simple to understand quickly?
• Is the product or benefit appealing?
• Is it unique?
• Does it have a unique competitive advantage?
• Does it appeal to the ego?
• Does it appeal to the wallet?
• What need does it fill?
• Is there a specific, clear and obvious call to action?
• Is there a reason, incentive or reward to act now?
• Is the production quality and personality appropriate for the target audience?
• What is the Last Mental Image (LMI)? Does it encapsulate the message, the call to action, the brand name? Does it leave the desired lasting impression?
  
• Does the ad contain a jingle?
• Is it catchy?
• Does it contain the brand name?
• Is it appropriate for the target audience?
• Does it contain the Unique Selling Proposition (USP) or unique value proposition, or a key benefit?
• Does the ad or brand contain a slogan?
• Does the slogan contain the USP or a key benefit?
• Does it make you recall the brand name?
• Is it memorable?
• Create a positive feeling for the brand?
• Reflect the brands personality?
• Is it believable?
• Is it simple?

FOCUS

"Deep penetration on a narrow front" is military mantra for tactical success. Concentration of force and strength equals power. Diversification of force is weakness.

Business success begins with focus. As does advertising and marketing success.

One of my favorite marketing books of all time is "FOCUS" by Al Ries, followed by "Good to Great" by Jim Collins, an "Positioning" by Al Ries and Jack Trout.

I have found over two decades of working with large Fortune 100 companies and small organizations across the nation, that focus and concentration is one of the key ingredients missing in their strategy for success.

Most companies lack focus, concentration and continuity in everything they do, including training, customer service, product or service quality, product offerings, pricing strategy, branding, marketing, advertising and media planning.

It's no wonder so many companies fail to reach their potential, or even survive. They don't know who they really are, who they serve or why. And they can't stay focused or on task long enough to build a brand image with meaning, depth and definition. A brand that the market can believe in and trust. A brand that stands for something of substance and reliability.

Look at In & Out Burger as a case study. They don't advertise at all in the traditional sense. They simply focus their strategy on a few key strategies that as it turns out people like, a lot:
Great locations
Great tasting, fresh quality food
Low prices
Simple menu
Excellent service
Clean and upbeat environment

With all these positive attributes going for it, the only advertising they need is word of mouth and loyal repeat customers, which is exactly what they have. Who needs to advertise when you have all the business you need by simply doing all the right things really well consistently.

To my knowledge In & Out has never had a sale, a coupon, a special or a discount of any kind. They don't need to. They provide a great value backed by quality and great service every day.

People like a good value for their money. They like quality, convenience, and they like consistency and continuity. Pretty simple concepts, but difficult to deliver.

Why? Because most companies and their revolving door of CEOs, CFOs, CMOs and the like want to try and tweak things, to put their own fingerprint on it, to squeeze out another 4% profit margin, to change the direction, the brand,the offereings, or the value proposition.

Most companies are not driven by a focused and rock solid mission statement, set of guiding principles, business plan or values.

And the market sees it and picks up on it. What the market prefers is brands run by integris people, with a clear, simple and conistent objective of delivering honest quality, value, service and convenience, all the time.

The market likes to know what a brand stands for, and what it will not stand for. They like to know they can depend on the brand to deliver on their advertised value proposition on a consistent basis. Regardless of who is in what executive seat at the time.

How to Afford TV Advertising

Anyone can afford to buy an effective schedule on TV.

Let me explain. TV is most effective when you narrow your buy to dominate a single station. And if you can't afford to buy the station, own a daypart, say Monday through Friday 6AM to 9AM.

Or you can own a single day on a single station, like Wednesday from 6AM to 3PM.

And at the very least, you can own a single program on a single station. But whatever you do, carve our a piece of TV real estate and make it your own. This will give you the frequency you need to cut through the clutter and move your audience to action.

As I have always said, frequency is far more important than reach, and it's better to be an inch wide and a mile deep in your buy, vs. a mile wide and an inch deep.

Another way of saying it is you are better off moving 10% of the market 100% of the way to a sale, than 100% of the market only 10% of the way.

I have also had very good success with dominating and concentrating my buy on smaller and independent stations using the same rule of frequency vs. reach. It's not so much the size of the station reach as it is how you schedule the buy.