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July 2016
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September 2016

How Much Should I Spend on Advertising/Marketing?

Some time ago I wrote about this topic and said then the answer to the question..."depends".
It depends on what you are selling, to whom you are selling and where you are selling. There are so many variables that it's difficult to answer the question without more information. Man Wine Guessing

This week I read a piece authored by John Heenan who assists advertising agencies in marketing themselves. That brought to light some interesting statistics that I think you'll find interesting as you attempt to advertise/market your company B2C or B2B.

When we look at some numbers we find the percentages are all over the board. According to Heenan, "Apple spends 7% of their revenue on sales and marketing, Tempur Sealy spends 15%, Oracle spends 20%, and Salesforce spends a whopping 56%. For B2B companies the simple answer is 6%. But it’s never simple."

Notice that last line..."But it's never simple."

Heenan goes on, "According to a 2014 AMA and Duke University study, 10% is the average for B2B. Does that mean 10% is the right number for you? Not necessarily. There are many factors to consider..."  So let's break them down:

  • Your Market - Who are you trying to attract to your product or service? If you are a retail business the answer may be very broad. If you are selling products or services to farmers your market gets less broad. If you are selling a service and you know the dominant decision maker your market gets less broad;
  • Your Market Hangouts - Where are your people? For example over 1 million people attended the Iowa State Fair in August if you are marketing to a broad range of people maybe you should have been there. Conversely, perhaps your target market is teachers in that case you need to be where they gather for events;
  • Your Current Customers - They are already coming in your door make sure they don't forget about you and continue to massage them with personal notes, calls and/or events. Just because they purchased what you are selling once doesn't mean they will be back unless you continue that relationship. Remember it costs less to keep a client than to find new clients;
  • Your Cost Per Customer - What does it cost you now to land a new customer and where did they come from? Do you know or do you think you know? "Word of mouth" is a common answer as to how they heard about your product/service however that answer isn't always right...but it is the easiest. 

Those four areas will help you start to define where and who your target market is and those are the first steps before you spend one dime on advertising. Remember finding out the answers to those questions all have a cost associated with the research...don't forget to include that in your base number.

See, told you "it depends".


Working It!

One of our preferred methods of communicating with businesses is on Twitter. The reason is simple; if the company is social media savvy the response time on Twitter is much faster and more direct than an email or phone call. Why? Because of transparency. When a company says they are "customer focused" yet ignore consumers the promise is empty.  In other words their action, or often inaction, speaks volumes. However on Social Media, and in this case Mid American Energy CONVO USE August 2016Twitter, everybody has a peek at what is really going on.

Sometimes things happen that allow the cream to rise to the top (if you've never milked a cow you might have to go look that up). Sometimes big and small companies outperform and here are two examples.

Last week there was a power outage in much of Iowa due to storms. Here in the Des Moines Metro thousands were without power. MidAmerican Energy is the local provider and I've learned, over the years, to turn to Twitter for help and input. I mentioned we were without electricity in our part of the Metro and within moments help and advice came back from @Mid_AmEnergyCo. So I checked their Twitter Stream and found their social media team was responding with not only advice but empathy. Actual REAL PEOPLE were responding and showing concern.

You can read the conversation above and to the right. If you click on the image it will enlarge...start at the bottom.

DART Convo August 2016Then, later in the week, I rode a Des Moines Area Rapid Transit bus to the Iowa State Fair. The bus lacked air conditioning and folks were opening up windows on the ride from the Capitol to the fairgrounds. I sent a Tweet chiding @RideDart and within two minutes they responded and were on it...notice the second screen shot.

Bottom Line

It does not matter if you are a small business or a large corporation you need to know and understand that in the world today there are many ways to communicate and be transparent. Those companies who "get it" and respond with feeling, empathy and honesty will always rise to the top and I, as a business person, am proud to call them out and share with you why I support them.  It takes work and dedication from the part of the company but it is so rewarding for those of us who count on you for service...well done! 

 

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The Other Universe

I was visiting today with a company that has been in their space for over 60 years. It's a good Man Older Social Mediacompany and known nationally however their brand needs to be adjusted. Consumers and business professionals know them as something that there were...not what they are today.

So, how do you re-brand a business and make that brand reflect what it is today vs. what it was thirty years ago? Oh, and their budget is limited but they have lots of people working for the company.

I introduced them to "The Other Universe".  Some of us call it social media.

Trouble is they don't understand how to make it work. Sure, they have heard of social media and yes they have a Twitter account and a business Facebook Page however, as is the case with most businesses, it is anemic. 

How do we fix that?  We start with a plan. An honest to goodness written down plan of action to make all of this work.  In that plan we must write down what our goal is and how we will measure success. Oh, and one other thing; we need to outline exactly who our target is and how we will reach out.

All of that needs to be done before they hit the keyboard.

Any bets it will get done?

It better because, in that "Other Universe" businesses, who have not been in the game as long, are figuring it out and I wouldn't want my friends to lose market share to some upstart.

Right?

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Yesterdays News

In the fast-paced world in which we live and with the myriads of information outlets available People Fast Pace Twodo you notice how fast yesterdays news gets forgotten?  Not that it was not important but people move on...quickly.

If you are a business and you are using social media to communicate with consumers doesn't it make sense to continue to drive your message...often and at different times of the day?

We think so and here are several tips to help you on the way:

  • Post Often - You work on your blog post and put it on Facebook and Twitter once. Chances are very few people will actually see what it is you took time to create. It is not bad form to re-post your piece several times during different day-parts; 
  • Mimic the Media - To that point start, on Twitter, to follow several news outlets. You will find they re-post news stories often and, in doing so, they change up the wording so that it is fresh;
  • Use Images - Doesn't matter if it is Twitter, Facebook, Instagram, LinkedIn or Snapchat make sure your image is included and the caption matches the image. It is more difficult with Twitter and 140 characters but worth it because the click through rate goes up;
  • Use a Service - We have used Hootsuite (there are others) for several years. It offers us the opportunity to schedule Tweets over a wide period of time. So we can send out the same story, with different words and sometime photos over various time periods and it takes just a few minutes;
  • Respond - If somebody likes what you are sharing make sure you respond with a "Thank you" or better yet feel free to ask a question about why they liked or re-posted what you have written.  Remember, social media is not just a broadcast tool it is about building relationships.

Five pretty simple tips that will help you boost your engagement.  After all, that is what we are all hoping for...right?

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Got a Mobile Strategy?

When we saw the headline in Advertising Age it was stunning: "Even as Mobile Gobbles Up Web Traffic 80% of Companies Don't Have a Long Term Strategy" Man Confused

Let that one sink in for a moment.

And, we're not talking about "Mom and Pop" brands or small business this was a survey among 4,000 seasoned marketers from around the world who admit that 37% of their digital traffic is coming from mobile, up from 31% in two years.

When we talk about mobile traffic here in the United States get this...according to SimilarWeb, 56 percent of traffic to the leading U.S.-based websites was from mobile devices in 2015.

This all poses two very important questions for you and your business:

  • Are You Mobile Friendly - Just yesterday I was directed to a media relations company website that was still not optimized for mobile. They are not alone. Why cut out over half of your potential client base. Get your website mobile friendly this week;
  • What is Your Digital Game - Consumers want to hear from you on their terms and they want to do that wherever they are. Failing to understand digital applications for business is shutting out consumers and that's bad for business.

There are all sorts of folks who can help you adapt to this technology but you need a plan, a starting point. You need to know how and where people are finding you and how they interact with your business. If you don't know...start asking. But, remember, you must replace customers on a regular basis so just because the majority of consumers may now find you outside of mobile...don't bank on that for the future.

There's much to learn and do to remain relevant. Go! 

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