If you’re in business, you know the economy has forced many businesses to cut expenses. Many of the business people I call on in Central and South Eastern Pennsylvania have few expenses they can cut but very often one of them is their advertising.
I have always suggested that if you stop advertising, you would not necessarily see much if any change for a while. This was the case for one of our former clients (2009 blog What if I Stopped Advertising). I talked about his experience where he cut all advertising while changing nothing else in his business. For the first few months, the client saw no drop in business. But after almost a year he saw a 42% drop. So if you need to lower the bottom line, cutting advertising may save you money, at least for a while.
To the advertisers who cut their advertising in 2008, 2009 and plan to continue cutting in 2010 if your business is still off, ask yourself this question. “Is it just the economy or do I need to change my advertising strategy? Good economy or bad, if you received two dollars back for every one you spent, you would not be cutting your advertising… you would be increasing it, right?
A lot of advertisers are starting to try new things. But before you do, think about your strategy. If you’ve been in business a while, you know the world has changed. Unless your business model has changed, cutting advertising alone is probably not much of a strategy. If you are not trying new ideas to improve efficiency, cutting advertising budgets without loosing market share is unlikely.
Some advertisers blame it on the economy. For sure they are at least partially right. But the advertisers loosing the most business right now are the ones that don’t try any new ideas or techniques such as new media.
The basics of advertising are still the same. The methods are changing. Top of mind awareness is still just as powerful as it ever was. But now you have to learn a new way to grow market share using new tools and techniques.
Top of mind awareness (TOMA) equates with market share. (The more top of the mind, the more market share.) This has been proven by Toma Research. TOMA has surveyed and measured 1300 markets over the past twenty years. Growing and maintaining your market share is critical and businesses should have a strategy of how to be the first name that comes to mind in your business category.
So how do you increase TOMA, and in turn increase market share? It is a very simple principle. You need to reach as many people as possible as often as possible. This is called reach and frequency. In the following charts you will see how much information people remember as a ratio of their exposure, and how quickly they forget. This shows frequency of exposure and time between exposures, which are both important considerations.
Note, in order to fully remember a message, it took 80 exposures. But after two days, only 10% was remembered. These charts are from studies done in the early 1900’s. But it is still relevant today. What has changed is the cost to achieve TOMA using traditional media. With audiences shrinking as lifestyles move to the Internet and other technologies it has become very inefficient to use many traditional media to build TOMA.
You know the saying, “When the going gets tough, the tough get going.” So start looking for better ways to keep your business on the top of the mind of consumers. Rather you Tweet, Facebook., eblast or embrace any of the technologies you have got to keep your name in front of the consumer. And if you try to achieve the same results you got 20 years ago without trying some new tools and techniques, you may find your market share dropping along with the economy.