Tuesday Marketing Notes (Number 48 —August 29th , 2006)

A B2B Marketing Newsletter for BMA Members
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B2B Print Advertising (Part 1: Should Your Company Be Advertising at All?)

by Eric Gagnon

Print advertising can be the riskiest, most expensive part of your company’s marketing program. It’s a sad fact in our business that more companies waste more money running ineffective print advertising than companies who make their advertising pay. More than any other B2B marketing activity, your success in using print advertising benefits the most from careful testing and conservative ad placements, to minimize your risk and expense on any new advertising project.

The Trouble with Advertising

Print advertising campaigns require the most advance planning and longest lead times of any other marketing activity. For example, a targeted direct mail project can be planned, developed and executed in days, or a couple of weeks at most. However, executing a print advertising schedule places you at the mercy of the publications where your advertising will appear, and presents you with an added lag time of 30-45 days from the time your advertising order is placed in a monthly trade publication, until your ad appears in print.

This time delay plays havoc with your ability to determine whether or not your advertising is working. In this new world where you can test a Google AdWords program, start-to-finish, in a week, your company may be on the hook for as long as two to three months before you can determine if your new print ad campaign is generating solid sales response.

A lot can happen in two to three months: Your competitor can launch a new product with features and benefits not adequately addressed by the ad campaign you approved two months earlier. You may discover a new, better, or less expensive way to sell your company’s products, but may not be able to expand this new activity immediately because you’ve already committed your company to a months-long advertising schedule in a print publication.

For start-up companies, the temptation to spend too much money, too soon, on print advertising can be a deadly mistake. When this happens, the start-up’s marketing program has been stalled, and its future placed in doubt, by an expensive, ill-conceived print advertising campaign.

Obviously, advertising can be effective, and the fact that U.S. companies spend about $220 billion each year on it proves its permanent role in our economy. But it’s also true that a substantial portion of this outlay is a wasted expense, and many marketing managers won’t admit it. Many companies have a tendency to overspend on their advertising budgets, and usually fail to hold their advertising accountable for its contribution to sales. Your success as a marketing professional depends on your willingness and courage to confront this issue head on for your company (or client), by demanding effectiveness and measurability from your print advertising projects.

Should Your Company (or Client) Be Advertising at All?

It’s a fair question to ask as a B2B marketing professional, and you’re not wrong to ask it: There are many successful industrial and trade companies operating in business-to-business markets who run little or no display advertising. Instead, these companies utilize direct mail, trade shows, and the Internet to support their on-the-street sales force (or telemarketing sales groups) to increase their sales year over year.

These companies would rather spend their marketing dollars on activities, such as direct mail, that target their prospects more accurately, and can be executed immediately. These companies have also developed proven sales channels—their outside sales reps, in-house telemarketing staffs, or independent dealers and distributors—who may not require extensive print advertising support to generate leads and sales.

These factors can help you decide if your company should run a print advertising program:

Your company’s age: If your company is a start-up or early stage company, you should move very cautiously into print advertising, if at all. There are other, more effective ways for a new company to break into its market, by direct mail, trade shows, and AdWords-type online keyword search programs, for example;

Your competition: If you are in a mid-sized company and are competing with other mid-sized companies who have been running advertising for some time, print advertising may be a viable option. The fact that your competition has been running the same type of advertising on a consistent basis may (and I repeat, may) mean that their advertising is generating sales and inquiry response for them. It may also mean that the company is wasting a lot of money on “image” advertising that isn’t generating sales response. Check with your company’s sales reps, your current customers, and other industry contacts, to determine if this is the case;

However, some of your competitors may be compelled to run advertising campaigns to satisfy the demands of their extensive dealer and distributor networks. These companies view advertising as their “ante” to maintain their position among their dealer base, with little thought given to whether their advertising programs actually work. Just because your competition is wasting their money running ineffective advertising doesn’t mean your company has to follow;

Your product, and its market: For companies contemplating sales of products directly to end users from their advertising, the price of a product is the most important factor in determining whether or not it can be sold directly from the ad.

The higher the product’s price, the less likely your prospect will purchase it on the spot, based solely on the information they read in your advertising. However, if your company sells a product priced under $1,000, it’s entirely possible to sell it directly from a display ad in a business-to-business marketplace. Products at higher prices will require you to use various multiple-step sales and marketing techniques to convert these prospects into customers.

Key Elements of Your Company’s Print Advertising Program

The four major elements of your company’s print advertising program are:

1.) The advertising layout (or deliverable);
2.) Ad size;
3.) Publication;
4.) Frequency

If you can successfully guide and grow your company’s advertising into a program that generates proven and measurable sales response for your company, you will have succeeded in transforming your company’s advertising from an expense into a measurable investment that generates a solid return for your company.

Your Advertising Program’s Goals

Before planning an ad program, you should always back up and ask yourself, again, whether or not your company should be running an advertising program in the first place. Given the expense, and the risk, it’s never wrong to take a second, or a third, hard look at any print advertising program.

Your company should run print display advertising only if it can accomplish one of these two major objectives:

Direct sales: Can you sell your company’s products directly from a print ad? The ability to sell a product directly from an ad, without intervening sales calls and other costly follow-up, is the ideal scenario for any marketing program. However, direct sales from advertising can only be done with easily-explained, relatively low-priced products, and most trade and business-to-business advertisers do not sell these kinds of products;

Sales leads: Most companies in B2B sell higher-priced products and services which require a longer sales cycle. Here, the role of print advertising is to generate sales response (sales leads and inquiries). Can your advertising program generate quality sales leads, and will you be able to measure the response from each ad placement? Sales lead generation, as opposed to direct sales, is the most common use of advertising in small to mid-sized companies. If you’re a marketing manager in one of these businesses, you’ll be working on advertising that is designed to generate inquiries and sales leads from your company’s advertising programs.

Response can usually be measured as requests for information on your company’s toll-free number from interested prospects, visits to a Web site link, or calls to a local dealer or distributor.

If you believe your company can generate either enough sales leads (more likely) or direct sales (less likely) from print advertising to at least cover the cost of your company’s advertising expense, then you should consider adding print advertising to your company’s marketing program.

If, however, your company’s print trade display advertising isn’t generating sufficient sales or response to cover its costs, then it’s your job as a marketing manager to stop any advertising your company is currently running, and fix the problem.

Next week, we’ll cover print advertising deliverables, and techniques for optimizing your ad programs to generate measurable sales response from print ad layouts. . .

Reader Comments . . .

Responding to TMN 46 on the topic of distributing layouts to clients, Greg Padley (padley@rfcp.com) writes:

Comments? Questions? Send them to me at: eric@realmarkets.net

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Attention Marketing Managers:
Get a Second Opinion  on Your Marketing Program. . . FREE

Think you should be spending less and getting more from your current marketing program? Tired of hearing empty “branding” promises from your ad agency that never seem to translate to actual, measurable sales results?

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Let us give you a second opinion on your current B2B marketing program and deliverables, at no cost or further obligation.

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Eric Gagnon (eric@realmarkets.net), is president of GAA (www.realmarkets.net), a sales and business development consulting firm, and is the author of The Marketing Manager’s Handbook, the master study guide for the Business Marketing Association’s Marketing Skills Assessment, Skill Builder, and Certification (MSA/B/C) programs.

For more information on The Marketing Manager’s Handbook, available to BMA members at a special discount, link to:

http://www.businessmarketinginstitute.com/book.html

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Test, Train, and Build Your B2B Marketing Skills for Better Sales Success: BMA Announces New Assessment, Training, and Certification for B2B Marketing Managers

For more information on the new BMA Marketing Skills Assessment, Skill Building and Certification (MSA/B/C) training and professional development program, visit http://www.businessmarketinginstitute.com