The common situation goes something like this: the specialty retailer gets a call from their local newspaper, TV or radio station wherein the caller asks for the “owner.” Then, the pitch begins about how effective their advertising is and how the cost per impression is cheap. On top of that…blah, blah, blah.
As a specialty retailer (tackle, bikes, skiing, camping, etc.) does it make sense to advertise to the general public, or should you confine your advertising money and efforts to a targeted audience via your website, Facebook, Twitter, LinkedIn, emails, etc.? After all, why should you pay to advertise to the general public when only 10-15 percent of that public is even remotely interested in your products?
On the other hand, investment in advertising boils down to sales generation and the cost to deliver the exposure to your targeted audience. If a TV ad or insert can generate sales of six to ten times the cost of the effort, then it’s a wise investment.
In today’s digital world, by using internet based advertising, the retailer can deliver tens of thousands of exposures for just pennies and—at the same time—reach consumers literally worldwide, versus just their local market. It’s cheap and it’s productive. So why wouldn’t the retailer go this route? In fact, they should…but not necessarily to the exclusion of other more traditional forms of advertising and promotion.
Advertising is about sales generation and brand building. Creating consistent sales and building a positive and productive consumer image must be done over a long time using multiple forms of consumer contact.
What a specialty retailer shouldn’t do is limit their advertising to just one media. Clearly, heavy use of internet-based advertising is a must, inclusive of a dynamic website, e-blasts and advertising via Facebook, Twitter, and other forms of social media.
In addition to digital advertising, don’t overlook the obvious, inexpensive and productive traditional forms of promotion such as great in-store merchandising, attention-getting signage, use of special purchases, dump tables, bulk displays, in-store coupons, advertising handouts, demonstrations, point-of-sale incentives, customer rewards cards and old-fashioned salesmanship and suggestive selling.
But what about traditional print advertising—is it dead?
Well, if used in the sense that you buy the ad and hope someone comes in to purchase something, then this form of “trolling” for sales is not cost-justified. But it can be under certain circumstances.
Candidly, I do like some forms of print advertising, particularly full-color, multi-page inserts included in the Sunday paper, handed out, mailed or delivered via email but with these provisos:
- The items to be included in the advertising are strong sellers in their own right and have inherent consumer appeal and demand.
- The items can be purchased by the dealer well in advance, at heavily discounted prices and in large quantities.
- The products will deliver a minimum margin of 33 percent at the sale price and be discounted at least by 30-40 percent from perceived retail.
- The cost of the promotion will be minimally one half paid for* by the participating vendors who should be well supported via the retailer’s purchases and thus yielding a return for the vendors for their advertising investment. *The vendors’ participation could be in the form of advertising dollars, free goods, credits or point-of-purchase displays.
- The ad document contains certain bounce-back instruments which will drive the consumer to your website for further incentives or drive the consumer to the store for additional rewards.
If the above criteria are largely met for either traditional print or electronic media, then this form of advertising will probably be successful and fully cost-justified.
Some smart retailers have offered to write weekly columns in the paper or produce radio or TV spots relative to their specialty. There is no charge to the retailer—the stations use unsold time or space and the dealer receives lots of recognition as a specialist in their respective field. Everyone wins, including the customer.
So in answer to the question, is it wasteful for specialty retailers to use traditional forms of advertising? I would say such advertising could be highly cost and sales effective as noted above, provided it is done in consort with strong, internet-based consumer advertising.
Editors Note: This story originally appeared in the March 2014 issue of Fishing Tackle Retailer.