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Advertising Game Plan: #1 Determine Your Budget

Previously, we described how you as a business owner need to develop an Advertising Game Plan.  We’re going to be taking you through a brief primer on the basic steps necessary to intelligently advertise your business.

Step one is to determine what advertising funds you have available for the coming year.  If you are a small business owner, this can be a “what comes first: the chicken or the egg?” scenario. If you don’t have any income,  how can you afford to advertise? On the other hand, if you don’t advertise, how can you build any income?

I don’t pretend that the answer is easy. Ideally you should start your new venture off  with a war chest that includes a significant portion set aside for advertising.  How much is enough you ask? In our opinion, if you are using traditional media in midsize markets (Milwaukee, Hartford, Birmingham, etc.), you need AT LEAST $1000 per month to gain any sort of noticeable impact within your first six months. And that means steady advertising, with a somewhat repetitive program every month. To give you just one example, you could likely negotiate 25 (mostly primetime) sixty-second radio commercials for $1000 in a midsize market. That would be appropriate for a solid 7-10 day sale each month. If you are in Boston or LA or Dallas, ratchet up that budget 3x to 10x as much.

And here’s a common error advertisers make:  they run the aforementioned 7-10 day advertising campaign, spend their hard-earned $1000…and no new customers come into the store. The owners panic and shout “Radio (or newspaper, or cable TV or…) doesn’t work!!!” and they turn around and try something completely different the next month, and then something else the next. And none of them work.

One of the secrets of successful advertising is that you initially have to have a cast-iron will.  You have to do your research, pick out a good media partner — the city paper, the local TV station, the area billboard company, or? — and HAVE FAITH in your research.  Start a campaign, and ride it out for several months without giving up and canceling the program you started. It takes time to develop customers!

Think about it…you just opened Bridget’s Gift Shop. Only 50 friends and family knew about it when you started off.  You decided to run 20 cable TV ads. Mary saw 4 of the 20 ads you ran, didn’t catch your name in the first two, missed the address the third time, and finally understood and liked the 4th commercial…but didn’t need what you were selling that week. Your campaign didn’t fail to sell Mary. It just hasn’t had enough time to sell Mary! Keep running ads every month, and if you have a good message, sooner or later Mary is going to need to buy Hallmark Christmas cards and will think “Hey, there’s that new Bridget’s Gift Shop on Maple St. Maybe I can go there and buy some cards.” And voila, the sales pitch she heard from you seven months ago finally lands you her credit card.

The bottom line is this: you need to advertise. It is arguably more important than having X number of good employees. You need to advertise to bring customers in to fuel your business. So sit down with your calculator and try to determine what extra cash you have to build your advertising kitty. We’ll take you through some further Advertising Game Plan steps from which you’ll see more clearly how to spend those dollars, and how much you may need to advertise effectively in your market.

Next step: determining what at least 5 or 6 of your local media cost.

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