Monday, May 12, 2008

Your Advertising Options

Let's take a look at most of your options, starting with Traditional Media:

Newspapers. This is the oldest of the traditional media's for advertising. And it also has been one of the hardest hit by the growth of the internet. Here's why:

  • Newspapers are funded by selling advertising and by selling the newspapers to their readers. The balance of advertising versus news content is determined by what the paper can afford. They usually have local reporters and also buy stories from "national wire services".
  • The reason people buy newspapers is to get the news, to know what's going on, in a convenient, portable, timely and inexpensive manner.
  • The advent of the internet coupled with portable computers (laptops), and wireless internet have disrupted the newspapers business model. Subscriptions have declined, so that revenue has decreased, and as the number of readers has declined, the revenue from advertisers have also declined due to either fall out because of higher advertising prices, or the effectiveness has decreased due to a smaller regular readership base.
  • Classified advertising was once a major source of income for many papers and has been replaced by on-line sites.
  • The speed and 24/7 updates of the internet makes newspapers less important since they have deadlines and any new updates have to wait until the next edition, usually 24 hours later.
  • Smart newspaper publishers have a website that makes up for the shortfalls of the printed page. The challenge will remain to redesign the business model of print and website to generate income to keep the local reporters employed and turn a profit for the owners.
  • Newspaper readers trend older, and traditional.
  • As a side note, it would be helpful for papers to print using a larger font (typeset) to cater to the older readers, but most are doing the opposite to save costs.
Next, let's look at another print medium, the Phone Book.
  • The phone book for decades served us as a directory, a reference. We had the white pages where every family in town had a listing complete with your street address. But the money required to print and distribute the phone book came from the Yellow Pages.
  • The Yellow Pages were a necessity for many businesses. If you didn't appear in the Yellow Pages, you didn't exist.
  • Most communities had one publisher of the phone book, then others saw the opportunity and started rival phone books. We have three major phone books in our town.
  • Consumers don't need more than one phone book for each of their phones. The reason for the additional phone book publishers was purely money driven, not consumer need driven. The second phone book company offered lower advertising rates to the businesses to get them in their book. The third phone book company, really struggles to survive.
  • When there was just one phone book, it was usually tied to your phone service provider, which gave them additional power to make sure you paid your monthly advertising bill. The consequences of not paying your Yellow Page advertising bill was simple, turn off your phone.
  • Again, technology has changed and hurt the Phone Book. Specifically Google is replacing the need for a paper phone book.
  • Changing consumer phone habits have also changed the relevance and reliability of the Phone Book. Landlines (the traditional wired telephones) are becoming obsolete as the growth of cell phones, where each member of a household has their own number and many families are dropping their landlines to save money. Phone books do not list cell phone numbers.
Billboards have remained stable over the years. Except for local communities enacting sign ordinances, not much has changed. Some of the changes that have occurred include:
  • Shared sign space. There are a few signs in our city that have three non-competing advertisers, that each get either 1/3 or 2/3 of the time, (depending on if the sign is visible front and back). The way this works, is every few seconds, the sign rotates to another advertiser. This has it's pluses, (movement creates attention), and minuses, (less exposure due to shared space).
  • Electronic signage. Once limited to store owned signs, some are now taking the place of traditional Billboards.
  • Disadvantage of Billboards is the limited amount of information you should place on the sign. It's not the size of the sign that determines how much you can put on the board, but how long a driver will see the sign as they head down the road. Less on the Board, is Better for your Business is the general rule to follow.
Before I finish this look at Traditional Media, let's touch on a couple other Advertising options.
  • Phone soliciting. I am surprised that some companies still do telemarketing. With the Do Not Call List Registry, a free service that consumers can sign up for and businesses must follow or face stiff fines, I would not recommend this to anyone as a way to generate sales. (There is a difference between telemarketing sales and using the phone for prospecting).
  • Direct mail. Ever since I was a kid, we called it Junk Mail. Unless you commit to it and have an offer that stands out, I would avoid it. And by committing to it, I mean monthly for 2 years, with an offer that is 40% savings or more. The problem is, that you then become known as a discount service or store and it is hard to build loyalty on having the lowest price. Not even Wal-mart gets all the customers.
  • Promotional Products. Calenders, pens, coffee mugs, etc. As long as you use these to enhance the other efforts you are doing, and you include the contact information such as website, address, phone number, etc.; you may want to use these as marketing tools, but not as advertising. Also make sure you get items that reflect the quality of your business. And finally, make sure you give these things out. Don't use them yourself. Get those pens and coffee mugs into your customers hands, not yours.
Now let's wrap up your advertising options using two of the biggest forms of Traditional Media, Broadcasting:

Television is still less than 100 years old. I recently found a promotional piece written in 1947 that mentioned that there are "currently 9 television stations operating" in the United States.

As a child of the 1960's and 1970's we had 3 choices, ABC, CBS, and NBC. Later we added a local PBS station and then an independent station that is now Fox. 5 stations. The numbers of people watching were tremendous. Now we have Cable, Satellite and Fiber Optic Networks that pump hundreds of channels into our homes, if we pay for them.

I have about 30 channels to choose from with the cable subscription we have in our home. The options for consumers such as myself to watch TV have multiplied six-fold, even though realistically, I watch maybe 12 at the most each week. Let's look at your Television Options:
  • Local Broadcast television news still grabs a large audience. Hit Shows on the Local Broadcast shows still grab a large audience. Not as large as 30 years ago, but still worth checking into, IF you have the money and you spend it wisely with reach, frequency and a strong message.
  • The downside to Local Broadcast television is that in February, 2009, all of our traditional television sets will be obsolete when the F.C.C. forces Local Broadcast television stations to turn off their analog broadcast and switch to digital broadcasting. Steps are underway to get converter boxes to consumers through a government program that consumers can use to help off set the cost of the box.
  • Also, the method of receiving Local Broadcast television varies depending on each community, but in our city, I've seen numbers showing that between 75% and 85% of us subscribe to a cable or fiber optic network, so we will not be affected by the switch to digital, since we don't get our television signals "over the air waves".
  • Advertising on television offers you many choices and they are priced accordingly. Make sure you understand what your options are.
Radio Broadcasting has also changed over the past nearly 100 years. It was the for-runner to television. Many of the early television shows were versions of old radio programs, except now you could see the performers, not just hear them.

Many thought radio would die, but instead it reinvented itself as a music and information source. Radio stations were previously programmed by networks, the way most television is today. With the growth of Television, radio became local with newscasters, reporters, announcers, personalities, disc jockeys, and local celebrities.

When I was growing up, there were no more than 7 or 8 local Fort Wayne Radio stations, the biggest being 50,000 watt WOWO which folks could listen to not only locally but all accross the eastern United States.

At one time 75% of the local population listened to the morning show on WOWO. Again, changes occurred by the F.C.C. Ownership rules relaxed. When I started working in radio in the 1970's, a company was allowed to only own one AM radio station, one FM radio station, and one television station in each market.

Today, the rules are different. Our company had 5 FM stations and one AM station until about two years ago. Most stations in town are co-owned with other stations. And now instead of 8 local stations, we have over 20 "local" radio stations. Those extra stations were around before, licensed to outlying cities, but the F.C.C. allowed them to upgrade the strength of their signal and become a part of the larger Metro.

For example, WNHT is licensed to Churubusco, WGL-FM is licensed to Huntington, but they are broadcasting out of our studios and offices in Fort Wayne.

Studies show that between 80 and 95% of Americans listen to a radio at least once a week. This figure is higher than Newspapers, and Yellow Pages.

What does this mean for you in terms of advertising options on the radio?
  • Each station has a core audience that has a loyal following. This audience has a certain profile which you can use to craft and target your advertising message to reach.
  • Each station also shares their audience with at least one or more other stations so you don't need to advertise on all the stations to reach "everybody".
  • Radio listening is growing for stations that are taking advantage of technology such as the internet. All three of my stations can be listened to from their website. This means you can listen at your desk at the office, or from ANYWHERE in the world that you have an internet connection.
  • In the future, local radio will face competition from the internet, once cars have internet "radio's" as standard equipment. The key to local radio survival is similar to local television survival: Local content, such as news, weather, sports and traffic.
As I wrap this up, you will notice that I said very little about the internet as an advertising option. Here's why:
  • We still have not come up with a way to advertise locally on the internet alone without tying it into one of the local options mentioned above.
  • There are rapid changes in what works best. Banner ads used to be the way to go, then Search Engine Optimizations. Right now we are on the cusp of the Social Media revolution and coming soon the mobile web which is growing and evolving.
You need a home on the internet, but you also need to tell people how to find you on the internet.

No comments:

Post a Comment